REALTORS® beware: there’s a new private right of action under Canada’s Anti-Spam Law

UPDATE: In June 2017, the federal government announced that it will suspend the private right of action portion of CASL which would have come into force on July 1 “in response to broad-based concerns raised by businesses, charities and the not-for-profit sector” which would include concerns raised in submissions made by CREA. A Parliamentary committee will be conducting a previously scheduled review of CASL beginning this summer and will certainly include discussion of the private right of action.  In the meantime, the federal government will continue to be the sole enforcer of CASL. Learn more: Canada Day and CASL Day: be ready for both.

REALTOR® members need to be doubly sure that their electronic messaging and advertising (by e-mail, social networks, texts) does not violate Canada’s Anti-Spam Law (CASL), the harvesting and use provisions of federal privacy law (The Personal Information Protection and Electronic Documents Act or PIPEDA) or the Competition Act provision relating to false or misleading advertising in electronic messages because a new big stick is about to be added: a private right of action.

Most of CASL has been in force since 2014. It prohibits, among other things, sending unsolicited Commercial Electronic Messages (CEMs) without the recipient’s consent, identification information about the sender and an unsubscribe link. CASL also resulted in changes to other legislation including the Competition Act which prohibits false or misleading representations in electronic messages (for example in email, texts, social media, websites and apps) including the subject line, sender information, URLs or metadata. It applies to the person who sends such a message and persons who cause or permit the message to be sent. Currently, only regulators can impose a penalty under CASL in the form of an administrative monetary penalty (“AMP”) of up to $1 million for individuals or $10 million for other entities.

On July 1, 2017, the private action provisions of CASL are scheduled to come into force. This will allow private parties who are affected by an act or omission in contravention of CASL (or related legislation regarding electronic messaging such as the Competition Act provision mentioned above) to sue the responsible individuals and organizations for damages, including compensation for actual loss, damages or expenses plus a statutory amount of damages depending on which type of violation occurred.

For example, sending a CEM containing false or misleading representations contrary to the Competition Act provision could result in statutory damages of $200 for each contravention, up to $1 million for each day on which a contravention occurred. In other words, if a court were to decide that an e-mail to each recipient is itself a contravention, then a single email sent to 5,000 recipients could hit the daily maximum of $1 million.  Different statutory damage amounts apply to provide actions involving other relevant sections of PIPEDA and CASL.

Private actions could involve lawsuits launched by individual parties or even class actions. Salespeople, their brokers, directors and officers can be sued as individuals. Organizations, including brokerages, may also be sued.

This new development means every salesperson and broker should take the opportunity to carefully review their electronic marketing practices. Now, who’s ready for a little CASL-related pick-me-up?

The article above is for information purposes and is not legal advice or a substitute for legal counsel.

Paul Feuer, our Senior Competition Counsel, provides legal advice to CREA and our member Boards and Associations, primarily on competition, consumer protection, and misleading advertising issues. Paul also conducts presentations for Boards, Associations, and REALTORS® on the basics of competition law compliance. When he’s not handling legal issues, he likes to kick back with some wine, play tennis, and spend time with his two kids – but not all at once.

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