Consumer Groups Petition FTC to Promulgate Rule Banning Deceptive Spam

September 4, 2002. The Telecommunications Research and Action Center, the National Consumers League, and Consumer Action submitted a petition [14 pages in PDF] to the Federal Trade Commission (FTC) requesting that it initiate a rule making proceeding to adopt a rule pertaining to deceptive practices in the sending of unsolicited commercial e-mail.

The groups propose banning deceptive practices in sending spam, such as misrepresenting the sender or content of the message. They also propose mandating an effective opt out procedure. Finally, they seek a private remedy.

The petition is titled "In the Matter of The Impact of Deceptive and Fraudulent Unsolicited Commercial Email or Spam on Consumers".

Congress has passed no legislation giving the FTC specific authority to regulate spam practices. Many bills have been introduced in recent Congresses. However, none has been enacted into law.

The petitioners argue that the FTC has authority to promulgate a rule under its general authority under Section 5 of the Federal Trade Commission Act (FTCA), which is codified at 15 U.S.C. ß 45. It provides, in part, that "Unfair methods of competition in or affecting commerce, and unfair or deceptive acts or practices in or affecting commerce, are hereby declared unlawful".

The consumer groups argue in their brief that "While the First Amendment protects the right of commercial free speech, it does not protect fraudulent or misleading speech. UCE is deceptive under the Federal Trade Commission Act when it is harmful to consumers. Common and egregious deception occurs when a sender intentionally misrepresents any portion of the email (including the senderís or recipientís identity). It is also deceptive to intentionally misrepresent the subject or content of an unsolicited commercial email, fail to provide a legitimate email or phone contact for the real party in interest, fail to provide a reliable opt-out instruction or fail to honor an opt-out request. The Commission has in its power an effective tool for dealing with this problem. Issuing a rule defining this type of email as a deceptive practice and giving consumers the power to enforce this rule would dramatically reduce the problem of deceptive UCE. It would also serve to reduce the amount of UCE in total, possibly restoring consumer confidence in e-commerce."

The petition also contains draft language for a proposed rule. It is as follows:
"Unsolicited commercial email is deceptive and therefore unlawful if it:
1. Misrepresents the sender (in source or routing information); or
2. Misrepresents the subject or content of the email; or
3. Fails to provide reliable contact information for the real party in interest; or
4. Fails to provide a reliable opt-out system; or
5. Is sent to an individual who has opted out or resigned from senderís list, or to whom sending unsolicited, commercial email is otherwise prohibited by law."

Howard Beales, Director of the FTC's Bureau of Consumer Protection, had this reaction. "The FTC is concerned about the proliferation of spam affecting consumers and we look forward to reviewing the petition. In every spam proposal we have seen, vigorous law enforcement is key. We have brought numerous cases against deceptive and misleading spam practices, and that's exactly what we will continue to do. Consumers can help our law enforcement efforts by sending spam to our spam mailbox at uce@ftc.gov." See, FTC release.