BILL ANALYSIS AB 2950 Page 1 GOVERNOR'S VETO AB 2950 (Huffman) As Amended July 2, 2008 2/3 vote ----------------------------------------------------------------- |ASSEMBLY: |47-20|(May 19, 2008) |SENATE: |22-12|(August 5, | | | | | | |2008) | ----------------------------------------------------------------- ----------------------------------------------------------------- |ASSEMBLY: |47-31|(August 12, | | | | | | |2008) | | | | ----------------------------------------------------------------- Original Committee Reference: B. & P. SUMMARY : Modifies existing prohibitions against unsolicited commercial electronic mail (e-mail). The Senate amendments : 1)State legislative intent that the provisions of this bill prohibiting all types of falsity and deception in commercial e-mail messages shall operate within the exception to federal preemption to the full extent permitted by the Controlling the Assault of Non-Solicited Pornography And Marketing Act of 2003 (CAN-SPAM Act of 2003). 2)Specify that it is unlawful for any person to adervitise in a commerical e-mail advertisement if the advertisement sent to or from a California e-mail address contains or is accompanied by a third party's domain name or e-mail address without the persmission of the third party. However, nothing in this bill shall be construed to affect comparative advertising that references domain names or e-mail addresses. 3)Define "header information" to mean the source, destination, and routing information attached to an electronic mail message, including the originating domain name and originating e-mail address, and any other information that appears in the line identifying, or purporting to identify, a person AB 2950 Page 2 initiating the message. 4)Specify that any enforcement action shall be commenced within three years after the cause of action accrued. 5)Specify that no cause of action barred under existing law on the effective date of this bill shall be revived by the enactment of this bill. 6)Make technical and conforming changes. EXISTING LAW prohibits a person or entity from advertising in a commercial e-mail advertisement that is sent either from California or to a California e-mail address if the e-mail contains or is accompanied by a third party's domain name without permission, contains or is accompanied by falsified, misrepresented, or forged header information, or has a misleading subject line, and makes a violation of the prohibition a misdemeanor. AS PASSED BY THE ASSEMBLY , this bill was substantially similar to the version passed by the Senate. FISCAL EFFECT : This bill is keyed non-fiscal. COMMENTS : According to the author, "Over 90 percent of all e-mail traffic in the United States is comprised of unsolicited commercial e-mail advertisements (spam), including false and deceptive spam?In 2005, spam cost United States organizations more than seventeen billion dollars ($17,000,000,000), including lost productivity and the additional equipment, software, and manpower needed to combat the problem. California represents 12 percent of the United States population with an emphasis on technology business and it is estimated that spam, including false and deceptive spam, cost California organizations well over two billion dollars ($2,000,000,000). "Despite CAN-SPAM [Controlling the Assault of Non-Solicited Pornography and Marketing Act of 2003], today 90% of all e-mail is spam. Filters have not proven effective, and spam is threatening the viability of e-mail as a means of communication, for individuals and businesses alike. A significant amount of spam has false or deceptive content, either technically or in AB 2950 Page 3 terms of the advertised content. Advertisers benefit from, but deny liability for, their advertising agents' unlawful activities. Spammers are adept at hiding their tracks. Recipients bear the costs of spam, not the spammers/advertisers." This bill follows SB 186 (Murray), Chapter 487, Statutes of 2003, which completely banned e-mail spam in California. To enforce this ban, SB 186 created a private right of action whereby a consumer or an Internet service provider could sue spammers and recover damages. Within months of its passage, SB 186 was preempted by the federal CAN-SPAM Act of 2003 which allows for spam as long as various conditions are met. These conditions include offering the ability to opt-out, a valid e-mail address contact, and the disclosure of the name and location of the spam sender. In 2003, Congress enacted CAN-SPAM to curb spam. As required by CAN-SPAM, the Federal Communications Commission (FCC) adopted rules that prohibit sending unwanted commercial e-mail messages to wireless devices without prior permission. This ban took effect in March 2005. In addition, the Federal Trade Commission adopted detailed rules that restrict sending unwanted commercial e-mail messages to computers. This bill as amended in the Senate is consistent with Assembly actions. GOVERNOR'S VETO MESSAGE : "In 2005, the Federal Communications Commission adopted rules that prohibit sending unwanted commercial e-mail messages to wireless devices without prior permission. In addition, California's anti-spam laws are among the toughest in the nation. Given these circumstances, AB 2950 appears to be unnecessary and may possibly invite excessive litigation for a nuisance that does not result in any damages or losses." Analysis Prepared by : Rebecca May / B. & P. / (916) 319-3301 FN: 0007949 AB 2950 Page 4