Background on the Verkada Case

In August 2024, the Federal Trade Commission (FTC) and the Department of Justice (DOJ) took action against Verkada, a California-based security camera company. Verkada was charged with multiple violations, including those under the CAN-SPAM Act, stemming from their practices in marketing through email. Verkada’s violations centered around the failure to provide essential opt-out mechanisms, honor unsubscribe requests, and include a valid physical postal address in their emails.

📧 What is CAN-SPAM?

The CAN-SPAM Act (Controlling the Assault of Non-Solicited Pornography and Marketing Act) is a U.S. law that sets rules for commercial emails. It requires businesses to offer an opt-out mechanism, include a physical postal address, and honor opt-out requests promptly. Violations can result in significant penalties, as the law aims to protect consumers from unwanted marketing emails.

🚫 How Verkada Violated CAN-SPAM

Verkada sent more than 30 million marketing emails over a three-year period but failed to comply with CAN-SPAM requirements. Specifically, Verkada:

• Did not provide recipients with a clear way to unsubscribe from emails.
• Ignored requests from recipients to opt-out.
• Failed to include a valid postal address in their emails.

These practices led to what is now the largest CAN-SPAM penalty issued by the FTC, amounting to $2.95 million.

💰 Largest CAN-SPAM Action

This case marks the largest-ever penalty under the CAN-SPAM Act. The $2.95 million fine underscores the FTC’s commitment to enforcing email marketing rules, highlighting the consequences for companies that fail to comply with federal laws on commercial email.

📧 Implications for Email Marketers

This case serves as a warning to all email marketers. Non-compliance with CAN-SPAM requirements can lead to significant financial penalties and legal challenges. Companies must take proactive steps to ensure they meet all legal obligations in their marketing efforts, or they could face similar consequences.

✅ CAN-SPAM Compliance Checklist

To comply with CAN-SPAM, businesses must ensure the following:

• Clear Unsubscribe Option: Every email must include a functional way for recipients to opt out.
• Prompt Unsubscribe Processing: Unsubscribe requests must be honored within 10 business days.
• Valid Postal Address: Each email should include a valid physical address of the sender.
• Transparency: Emails must not use misleading subject lines or deceptive content.

By adhering to these rules, businesses can avoid hefty penalties and maintain trust with their audience.

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