Home » ACMA's Fight Against Spam

The Australian Communications and Media Authority (ACMA) has taken two significant steps forward in the fight against spam in the last few months. The first was a successful Federal Court judgment against Clarity1 and its Managing Director, Mr Wayne Mansfield, for breaches under the Spam Act 2003 (Cth), the first substantive decision dealing with the Act. The second was ACMA’s launch last week of the SpamMATTERS reporting button, which will facilitate the speedy and easy reporting of spam. This article will outline what impact the Federal Court’s decision in Australian Communications and Media Authority v Clarity1 Pty Ltd [2006] FCA 410 will have on email marketers before considering how the ‘one click’ spam reporting button will assist ACMA in minimising the adverse consequences of spam.


ACMA v Clarity1: The Facts
ACMA alleged that from 10 April 2004 Clarity1, an Australian company, periodically sent unsolicited commercial electronic messages (CEMs) to electronic addresses it had harvested from the internet using address-harvesting software or had purchased from organisations or persons selling electronic lists of electronic addresses harvested from the internet. In all, ACMA alleged that Clarity1 sent 270 305 474 CEMs (of which 74 996 560 were successfully sent) to 7 956 457 unique electronic addresses. The CEMs sent by Clarity1 contained an unsubscribe facility and the evidence was that some 166 000 requests to be removed from the lists were made, all of which were acted upon. Over the same time period only 79 complaints were made concerning CEMs from Clarity1 were made to ACMA.

The Spam Act
ACMA alleged that Clarity1 contravened ss 16 and 22 of the Spam Act:

• section 16(1) of the Spam Act provides that a person must not send a commercial electronic message that has an Australian link. Section 16(2) provides a defence if the relevant electronic account holder consented to the sending of the message.
  
• section 22(1) of the Spam Act prohibits the use of address-harvesting software or a harvested-address list.

An Australian Link
Justice Nicholson held at [68] that it was more probable than not that the CEMS had the requisite Australian link because "the sender or person authorising the sending was physically present or had its central management and control in Australia or the computer, server or device utilised for the sending was located in Australia."

No inferred consent
Clarity1 sought to defend the allegation under s 16(1) by arguing that the electronic account holders had consented to the sending of the CEMs. Clarity1 made three arguments.

First, Clarity1 argued that as the CEMs sent contained an unsubscribe facility, Clarity1 was entitled to reasonably infer that any recipient who did not use this facility had consented to the sending of the CEMs. The Court held at [77] that there were "powerful features of the evidence which are inconsistent with the drawing of any such inference and militate against it." The Court found that the inference was not open where the entire relationship between Clarity1 and the recipient was constituted in the absence of bilateral communication. The Court also felt there were a variety of methods available to recipients to deal with unwarranted CEMs: deleting the CEM without reading it, ignoring the CEM, reporting the CEM to ACMA, and utilising filtering or blocking techniques. The probability of this being the case was "very substantially enhanced in the circumstances" by the use of Stealth Mail Master by Clarity1 (Stealth Mail Master has the functionality to randomise email header information, to use open proxies and to hide IP addresses). Finally, the Court also felt that the volume of CEMs made it improbable that Clarity1 could have been aware that consent was in place prior to the sending of the CEMs.

Second, Clarity1 argued that consent could be inferred from the business relationship between Clarity1 and the individual or organisation. The Court held that there could be no business relationship when the communication is one sided. The relationship must have a connection arising from mutuality. Accordingly, the Court held that the 182 purchasers who replied and wished to trade with Clarity1 had given their consent for the purposes of s 16(2) of the Spam Act.

Third, Clarity1 argued that the recipients had consented by publishing their electronic addresses on the internet. For this exception to be applicable, a number of elements must be satisfied:

• there must be a particular electronic address enabling the public, or a section of the public, to send electronic messages to the person or holders of particular offices, positions, functions or roles specified in clause 4(2)(a)(i) to (vii) of Schedule 2 of the Spam Act;
  
• the address must have been ‘conspicuously published’ (clause 4(2)(b));
  
• it must be ‘reasonable to assume’ that the publication occurred with the agreement of the person or organisation concerned (clause 4(2)(c));
  
• it must be established that the publication was not accompanied by a statement to the effect that the relevant electronic account-holder does not want to receive unsolicited CEMs at that electronic address, or words to similar effect (clause 4(2)(d));
  
• it must also be established that the CEM is relevant to the work-related business, functions or duties of the employee, director, officer, partner, office-holder or self-employed individual concerned, the office or position concerned, or the function or role concerned (clause 4(2)(e) to (g)).

The Court held that Clarity1 had failed to present any evidence of the type required by Schedule 2.

Accordingly, the Court held that the claim under s 16 of the Spam Act had been made out.

Use of harvested-address lists obtained before the Spam Act came into operation
The evidence supported Clarity1’s argument that any harvesting occurred prior to 10 April 2004, which is when the Spam Act relevantly came into operation. However, it was alleged that Clarity1’s usage of the harvested addresses after 10 April 2004 constituted a contravention of s 22 of the Spam Act because it was usage in connection with a contravention of s 16 of the Spam Act. As was noted at [115] this is important as:

The prohibition in s 22(1) against the use of address-harvesting software or a harvested-address list is one which does not apply in the circumstances referred to in s 22(2). Those circumstances are where the use ‘was not in connection with sending commercial electronic messages in contravention of section 16’. The consequence is that s 22(1) does apply where the use is in connection with sending CEMs in contravention of s 16.

Therefore, the Court held that the claim under s 22 of the Spam Act had been made out.

Summary
This decision is significant for email marketers for the following reasons:

• The inclusion of an unsubscribe facility does not impose an obligation on the recipient to reply to avoid an inference of consent.
  
• A business relationship cannot be inferred if the communication is one sided.
  
• Consent cannot be inferred from the mere fact that the relevant electronic address has been published.
  
• connection with sending CEMs in contravention of s 16 of the Spam Act.
  
• The Spam Act prevents the use of harvested lists from the date the Act came into operation, regardless of when the lists were compiled.

SpamMATTERS reporting button
On 30 May, ACMA launched the SpamMATTERS reporting button which enables spam to be reported to ACMA with 'one click'. The SpamMATTERS button is available for users of Microsoft Outlook and Microsoft Outlook Express to download from ACMA's website (www.spam.acma.gov.au) and Telstra has made a version of the button available to its Telstra.com and BigPond WebMail customers. Other users can register online for a 'key', and then submit spam via ACMA's online spam submission form. ACMA hopes that instead of users deleting spam emails, users will select the SpamMATTERS button to simultaneously delete their spam and report it to ACMA.

Submitting spam to ACMA using this method will help ACMA identify emerging spam campaigns and provide timely information to authorities fighting spam-related crime such as phishing, Nigerian scams and mule scams. It is also hoped that over time customer usage of the SpamMATTERS button will also enable ACMA to assist internet service providers in securing their networks from spam threats.

This new weapon in the fight against spam, coupled with ACMA's successful prosecution of Clarity1, demonstrates that ACMA is undertaking considerable activity in minimising the adverse consequences of spam on Australian internet users.