CASL Class Actions Are Looming

The private right of action for sending spam in violation of CASL comes into force on July 1. Many companies are dreading it – some class action lawyers can’t wait. The right thing for the government to do would be to completely scrap CASL – the statute is that bad and ill-conceived. But wishful thinking won’t make it go away.

At the moment, CASL violators are subject to enforcement proceedings by the CRTC. But after July 1, those who have been spammed in violation of CASL can sue the sender. Here are some things to keep in mind about the private right of action.

• Individuals can sue a CASL violator – but class actions are most likely.
• CASL does not say if the right applies only to violations that occur after July 1. That would be the most obvious interpretation, but expect plaintiffs to say it is retroactive.
• In addition to the CASL anti-spam formalities, the right of action applies to the anti-harvesting provisions CASL added to PIPEDA, and the email false advertising provisions CASL added to the Competition Act.
• Damages include actual damages plus statutory damages calculated in a couple of ways – $200 per violation or up to a million dollars per day. It could get expensive.
• Directors and officers are at risk to be sued.
• Depending on timing, a notice of violation from the CRTC or entering into an undertaking with the CRTC may stay a court action. The reverse also applies – a court can prevent an undertaking or notice of violation. Potential defendants may have some influence over picking their poison.
• Due diligence defences are available to mitigate the damage amount.