Ottawa pre-empts ‘gold rush’ of anti-spam lawsuits

Class-action lawyers keen to spend Canada Day filing claims over unwanted emails will instead have to spend the holiday getting patriotic.

Ottawa announced Wednesday (June 7) it’s delaying certain provisions in Canada’s Anti-Spam Legislation (CASL) set for July 1 that would have allowed people to file lawsuits against individuals or organizations violating the regulations.

Lawyer Tony Wilson of Boughton Law said many businesses aren’t aware they required express consent from people they email on their mailing lists as of next month.

“Class-action lawyers [were] waiting with bated breath for violations of CASL,” he told Business In Vancouver.

“But right now there are going to be administrative penalties and not some sort of lawyer gold rush members of the legal profession might have been anticipating.”

Although businesses and individuals won’t be subject to lawsuits, they could still face administrative penalties as high as $1 million for individuals and $10 million for businesses.

Online dating app PlentyofFish was fined $48,000 in 2015 after regulators investigated complaints the Vancouver company was sending commercial emails to users without a clearly visible unsubscribe option.

When CASL went into effect in July 2014, organizations and individuals were given three years to seek express consent from people when sending commercial emails.

In the intervening three years, businesses have been able to deliver emails to people based on implied consent, such as a prior business relationship.

But that comes to an end on July 1.

Wilson said any slipups could result in substantial legal fees for people who are unaware of the rules.

“So you find 10,000 people who got an email blast from someone who didn’t have the consent or didn’t have the unsubscribe mechanism or failed to properly identify themselves,” he said.

“And somebody is there at the receiving end of a class-action lawsuit. That could be extremely expensive for a company that made an honest mistake.”

Business groups are applauding the government’s decision.

The Canadian Federation of Independent Business (CFIB) sent a letter to federal Innovation Minister Navdeep Bains last month asking Ottawa to reconsider the provision that would allow groups and individuals to take legal action.

"We asked, and government listened," CFIB president Dan Kelly said in a statement.

“This measure will help address some of the red tape headaches the legislation has presented to Canadian small firms."

Anita Huberman, CEO of the Surrey Board of Trade, said her organization is also thankful the government is now throwing the legislation over to a parliamentary committee for review.

“This is a big win for Surrey businesses. Businesses rely on their capacity to communicate with their clients, and some of these measures would have limited their capacity to do this,” Huber said in a statement.

“Additionally, this provision would cost Canadians heavily in lost productivity and mischievous litigation.”