Legislature(2003 - 2004)

02/19/2003 03:17 PM L&C

Audio Topic
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
HB  36-ELECTRONIC MAIL                                                                                                        
                                                                                                                                
Number 0745                                                                                                                     
                                                                                                                                
CHAIR ANDERSON  announced that the  next order of  business would                                                               
be  HOUSE  BILL NO.  36,  "An  Act  relating to  electronic  mail                                                               
activities and  making certain electronic mail  activities unfair                                                               
methods of competition  or unfair or deceptive  acts or practices                                                               
under  the Act  enumerating unfair  trade practices  and consumer                                                               
protections."                                                                                                                   
                                                                                                                                
Number 0750                                                                                                                     
                                                                                                                                
REPRESENTATIVE LES GARA, Alaska  State Legislature, sponsor of HB                                                               
36, explained  that 27 other  states regulate junk  e-mails; junk                                                               
e-mails are  uninvited commercial  messages commonly  referred to                                                               
as spam.  Every year  Congress considers legislation to deal with                                                               
this issue, and every  year it dies, so it's up  to the states to                                                               
deal with unwanted e-mail.  He  explained that in drafting HB 36,                                                               
he used Washington [state] and  California laws because they have                                                               
been tested  and upheld in  the courts.  Unfortunately,  he said,                                                               
HB 36 does not  ban spam.  A state cannot  impose an outright ban                                                               
on commercial speech and have it upheld in the courts.                                                                          
                                                                                                                                
REPRESENTATIVE GARA testified that  HB 36 requires anyone sending                                                               
out commercial  e-mails to  provide the  recipients with  an easy                                                               
way to have  their addresses removed from  the sender's database.                                                               
In addition,  the sender  must indeed  remove the  recipient from                                                               
the list.  Refusing to do  either of these actions is a violation                                                               
of the proposed  law.  House Bill 36 allows  employers to enforce                                                               
the law on  behalf of their employees.  It  also permits Internet                                                               
service providers  to adopt privacy policies  regulating spam and                                                               
allows them to file a  legal action against businesses that don't                                                               
follow these policies.                                                                                                          
                                                                                                                                
REPRESENTATIVE  GARA explained  that the  bill is  enforced under                                                               
Alaska's existing  Unfair Trade Practices Act.   Private citizens                                                               
and the attorney  general's office have the right  to enforce the                                                               
law.   In many  states, anti-spam  laws can  only be  enforced by                                                               
attorney  generals' offices,  which are  notoriously underfunded.                                                               
He  stated  that he  has  received  letters  of support  from  an                                                               
employers'  association,  the  Alaska  Public  Interest  Research                                                               
Group, GCI, an  Internet service provider, and AARP.   The people                                                               
who oppose  these anti-spam bills  do not voice  their opposition                                                               
during the legislative process but  instead challenge the laws in                                                               
court, he suggested.                                                                                                            
                                                                                                                                
Number 1032                                                                                                                     
                                                                                                                                
REPRESENTATIVE  GUTTENBERG  moved  to  adopt  proposed  committee                                                               
substitute  (CS)  for  HB  36,  Version  23-LS0224\S,  Bannister,                                                               
2/17/03, as the working document.                                                                                               
                                                                                                                                
Number 1055                                                                                                                     
                                                                                                                                
REPRESENTATIVE ROKEBERG  objected for purposes of  an explanation                                                               
of the proposed CS.                                                                                                             
                                                                                                                                
REPRESENTATIVE  GARA  explained  that GCI,  an  Internet  service                                                               
provider and  one of the  bill's supporters, sent a  [February 5,                                                               
2003] letter noting  a minor, one-word typo on page  5, lines 15-                                                               
16, which has been corrected in the proposed CS.                                                                                
                                                                                                                                
Number 1125                                                                                                                     
                                                                                                                                
REPRESENTATIVE ROKEBERG withdrew his objection.                                                                                 
                                                                                                                                
Number 1134                                                                                                                     
                                                                                                                                
CHAIR  ANDERSON,  hearing  no  other  objection,  announced  that                                                               
proposed CS for HB 36, Version S, is adopted for discussion.                                                                    
                                                                                                                                
REPRESENTATIVE GARA  identified one  change in  the Version  S on                                                               
page 5,  lines 13-16.  Subsection  (5) states that HB  36 governs                                                               
only  commercial  e-mails  from  senders  with  whom  the  person                                                               
doesn't  have an  existing relationship,  e-mails  that are  sent                                                               
without the person's consent.   Language was added on lines 15-16                                                               
to  clarify  whether  the e-mail  is  solicited  or  unsolicited:                                                               
"unless the advertisement  is sent at the request of  or with the                                                               
express consent of the recipient."                                                                                              
                                                                                                                                
CHAIR  ANDERSON noted  that the  proposed CS  is one  and a  half                                                               
pages  longer than  the original  bill and  asked for  details on                                                               
other changes in Version S.                                                                                                     
                                                                                                                                
Number 1244                                                                                                                     
                                                                                                                                
REPRESENTATIVE  GARA explained  that  there  are two  significant                                                               
differences between  this proposed  CS and his  original prefiled                                                               
bill.   The original  HB 36  used a  feature from  California law                                                               
that stated  the subject line  of commercial e-mail  must contain                                                               
the  label "ADV:"  and  the  additional label  of  "ADLT" if  the                                                               
content is  adult.  He  said he  removed this feature  because if                                                               
various states have differing requirements  for the subject line,                                                               
the  bill would  be  vulnerable to  constitutional  attack.   The                                                               
sender could successfully  argue in court, "We  can't possibly do                                                               
in the subject  line what 50 different states require."   He said                                                               
it's a  good idea but not  workable and opens the  bill to attack                                                               
in the courts.                                                                                                                  
                                                                                                                                
REPRESENTATIVE  ROKEBERG asked  whether there's  a constitutional                                                               
problem with requiring  identifiers in the subject  heading of an                                                               
e-mail.   He noted  that this  committee just  passed out  HB 82,                                                               
which required  the "ADV:ADLT"  label in  the subject  heading of                                                               
commercial e-mails with adult content.                                                                                          
                                                                                                                                
REPRESENTATIVE GARA noted  that HB 82 works  because it regulates                                                               
e-mail sent within Alaska.   House Bill 36 regulates out-of-state                                                               
e-mail as well, and that's  why his bill was written differently.                                                               
His  bill does  not  require specific  words to  be  used on  the                                                               
subject  line; it  follows Washington  [state's] lead,  requiring                                                               
that the  sender not  use misleading words  in the  subject line.                                                               
He said it's not a burden on  senders of e-mail to be truthful in                                                               
their subject heading  line.  The prohibition  against sending an                                                               
e-mail with  a misleading heading  is on page  3, line 10:   "(3)                                                               
contains false  or clearly misleading information  in the subject                                                               
line."                                                                                                                          
                                                                                                                                
Number 1487                                                                                                                     
                                                                                                                                
CHAIR ANDERSON  noted that the Version  S has a title  change and                                                               
many  of  the  sections  are   different.    He  asked  for  more                                                               
explanation.                                                                                                                    
                                                                                                                                
REPRESENTATIVE ROKEBERG said that  committee members did not have                                                               
the opportunity  to review  the proposed  CS before  the meeting.                                                               
He asked  about Section 4, which  starts on page 5,  line 27, and                                                               
which  references uncodified  law  and the  contingent effect  of                                                               
Section 2.                                                                                                                      
                                                                                                                                
Number 1619                                                                                                                     
                                                                                                                                
REPRESENTATIVE GARA explained  that Section 4 of HB  36 creates a                                                               
backup in  case there's a constitutional  problem with regulating                                                               
commercial  e-mail too  stringently.   This bill  went through  a                                                               
number  of versions  as  he  tried to  narrow  down the  possible                                                               
constitutional challenges.  He said  he wants to regulate out-of-                                                               
state  e-mail  because  little commercial  e-mail  originates  in                                                               
Alaska.   Most of  the bill follows  the California  model, which                                                               
regulates any e-mail  that touches any equipment in  the state en                                                               
route to  the recipient.   Representative  Gara said  he believes                                                               
the  bill is  valid  as written,  but  if a  court  were to  rule                                                               
against regulating out-of-state e-mail  in this blanket way, then                                                               
HB  36  contains  a  clause   that  would  revert  to  Washington                                                               
[state's] narrower approach.  The  contingent effect of Section 2                                                               
would regulate out-of-state  e-mail if the senders  had reason to                                                               
know they  were sending it to  recipients in Alaska.   He pointed                                                               
to  the example  of  an "Alaska.net"  address  that indicates  an                                                               
Alaska Internet service provider.   Sections 2 and 4 are fallback                                                               
provisions so  that the law  would remain  in force if  Section 1                                                               
were overruled by a court.                                                                                                      
                                                                                                                                
Number 1787                                                                                                                     
                                                                                                                                
REPRESENTATIVE  GARA  explained  that  a  second  change  in  the                                                               
proposed  committee  substitute  clarified that  employers  whose                                                               
employees receive e-mails at their  work address can enforce this                                                               
law.  House  Bill 36 allows individuals and  employers to enforce                                                               
the law.                                                                                                                        
                                                                                                                                
REPRESENTATIVE  ROKEBERG stated  that he  has never  seen a  bill                                                               
drafted in  the manner  of HB 36.   He pointed  out Section  2 on                                                               
page  5, lines  17-24, which  states that  AS 45.45.800-45.45.890                                                               
doesn't apply unless a person  sends an unsolicited e-mail either                                                               
from a computer  in Alaska or to a person  with an Alaskan e-mail                                                               
address.   Section 4  states that Section  2 doesn't  take effect                                                               
until  a   court  decision  rules   Section  1  of  the   law  is                                                               
unconstitutional.                                                                                                               
                                                                                                                                
Number 1916                                                                                                                     
                                                                                                                                
REPRESENTATIVE GARA agreed  that Sections 2 and 4  of the Version                                                               
S were unique  and said he hoped the situation  would never occur                                                               
in which  they took effect.   He reiterated that if  a court held                                                               
that HB 36's regulation of junk  e-mail was too broad, a narrower                                                               
approach would take effect.                                                                                                     
                                                                                                                                
CHAIR ANDERSON said  HB 36, because of its many  changes, will be                                                               
held over for additional public hearing.                                                                                        
                                                                                                                                
Number 2024                                                                                                                     
                                                                                                                                
JESSICA CAREY  GRAHAM, Legislative  Chair, Anchorage  Society for                                                               
Human Resources Management (ASHRM),  explained that she practices                                                               
employment law  at the firm  of Perkins  Coie in Anchorage.   The                                                               
Society  for Human  Resources Management  is the  world's largest                                                               
association devoted to human  resources management; the Anchorage                                                               
chapter  has 275  members in  business, nonprofit  organizations,                                                               
state, and  local government.   Her  organization supports  HB 36                                                               
for several reasons.   She testified that the  phenomenon of bulk                                                               
commercial e-mail  has a significant financial  and morale impact                                                               
on employers  and employees in  Alaska.  Employers  commonly have                                                               
no solicitation policies  in place to try to limit  the deluge of                                                               
advertisements.   As a result,  employees commonly  get bombarded                                                               
with this kind  of material from around the globe,  with no means                                                               
of putting  a stop  to it.   Because employees'  e-mail addresses                                                               
are  easily identifiable  from a  corporate  web site,  employers                                                               
become an easy target for this spam.                                                                                            
                                                                                                                                
MS. GRAHAM  said the second  reason her  group supports HB  36 is                                                               
because  employers  have limited  control  over  the content  and                                                               
dissemination  of offensive  e-mails.   Many  e-mails have  adult                                                               
themes,  and these  e-mails can  be circulated  by employees  who                                                               
think it  is a  joke.   She said  that one  employee's idea  of a                                                               
humorous  adult  e-mail  can  end   up  as  evidence  in  another                                                               
employee's  sexual  harassment  lawsuit.     As  human  resources                                                               
professionals, ASHRM  members are on  the front lines  of dealing                                                               
with  employee  issues  and  complaints,   and  this  bill  gives                                                               
employers  another tool  to limit  this  kind of  material.   She                                                               
pointed out  the productivity  costs associated  with adult-theme                                                               
advertisements.  She said her group  strongly supports HB 36.  As                                                               
an  attorney,  she  said  she  supports  the  proposed  committee                                                               
substitute  version.   She  said  she appreciates  Representative                                                               
Gara's  attempt  to  give  employers  standing  to  pursue  these                                                               
complaints in court.                                                                                                            
                                                                                                                                
REPRESENTATIVE  ROKEBERG asked  Ms. Graham  to identify  where in                                                               
the proposed CS an employer's standing is strengthened.                                                                         
                                                                                                                                
MS. GRAHAM  replied that on  page 4,  lines 8-9, the  proposed CS                                                               
states, "In  this section, 'recipient' includes  a business whose                                                               
employee  receives  the  advertisement   in  the  course  of  the                                                               
employment."  She  said she had sent an  e-mail to Representative                                                               
Gara urging the inclusion of similar language.                                                                                  
                                                                                                                                
Number 2189                                                                                                                     
                                                                                                                                
STEVE   CLEARY,  Executive   Director,  Alaska   Public  Interest                                                               
Research Group (AkPIRG), testified in support  of HB 36.  He said                                                               
HB  36  will  be  a  great  cost-saving  measure  for  employees,                                                               
employers,  and private  citizens who  are being  bombarded on  a                                                               
daily basis with unsolicited commercial e-mails.                                                                                
                                                                                                                                
Number 2223                                                                                                                     
                                                                                                                                
ED SNIFFEN,  Assistant Attorney General, Fair  Business Practices                                                               
Section, Civil  Division (Anchorage),  Department of  Law, stated                                                               
that the department  supports the concept of HB 36.   He said his                                                               
department reviewed the bill  for potential constitutional issues                                                               
and  did not  find  any  legal infirmities.    He  said that  the                                                               
sponsor has  done a  good job of  recognizing the  limitations of                                                               
the  Washington and  California cases.   His  section within  the                                                               
Department of  Law would be responsible  for enforcing complaints                                                               
brought under  this bill.  Complaints  generated by telemarketing                                                               
and  e-mail  Internet  problems  are   now  equal  in  number  to                                                               
automobile complaints in his office.   He said he hopes this bill                                                               
will curb fraudulent e-mail practices.                                                                                          
                                                                                                                                
Number 2278                                                                                                                     
                                                                                                                                
MR. SNIFFEN replied to a  question from Representative Guttenberg                                                               
about the  meaning of the  words "clearly  misleading information                                                               
in the subject line" on page 3,  line 10.  He replied that a jury                                                               
would have  to decide whether the  subject line in an  e-mail was                                                               
clearly  misleading.    "Clearly misleading"  requires  a  higher                                                               
standard of proof.                                                                                                              
                                                                                                                                
REPRESENTATIVE  GUTTENBERG asked  whether the  words "assists  in                                                               
the transmission" on  page 3, line 16, apply to  an ISP [Internet                                                               
service  provider]  that inadvertently  transmits  virus-infected                                                               
spam because  it didn't use  a strong enough virus  protection or                                                               
Internet blocker.                                                                                                               
                                                                                                                                
Number 2355                                                                                                                     
                                                                                                                                
MR. SNIFFEN  replied that he  didn't think the bill  was intended                                                               
to  make ISPs  responsible for  the transmission  of viruses  but                                                               
deferred to  Representative Gara  to discuss  the intent  of that                                                               
language.                                                                                                                       
                                                                                                                                
TAPE 03-9, SIDE B                                                                                                             
Number 2375                                                                                                                     
                                                                                                                                
REPRESENTATIVE  GARA replied  that he  intended that  an Internet                                                               
service  provider  not  be  held  liable  for  such  conduct  and                                                               
referred  to the  language on  page  4, lines  10-12, which  says                                                               
these laws  "do not apply unless  a person sends or  causes to be                                                               
sent an unsolicited electronic mail  advertisement ...."  He said                                                               
he has  considered narrowing that  language even more to  make it                                                               
clearer.                                                                                                                        
                                                                                                                                
Number 2356                                                                                                                     
                                                                                                                                
REPRESENTATIVE ROKEBERG asked about the  meaning of the words "an                                                               
intervening  interactive  computer  service" in  subsection  (b),                                                               
page 3, lines 11-18.                                                                                                            
                                                                                                                                
REPRESENTATIVE  GARA  replied  that  this  section  assures  that                                                               
Internet service providers  are not held liable  if somebody uses                                                               
their lines or sends  a virus over their lines.   The bill is not                                                               
aimed  at imposing  liability  upon  Internet service  providers.                                                               
The section on page 4, lines 10-24,  limits who can be named in a                                                               
lawsuit.   Representative  Gara  said he  has  asked a  committee                                                               
member  to present  an amendment  today that  would tighten  this                                                               
language.   He asserted that  HB 36 is  aimed at people  who send                                                               
bulk commercial e-mails.                                                                                                        
                                                                                                                                
REPRESENTATIVE  ROKEBERG  asked about  the  language  on page  3,                                                               
lines 11-18,  which says the  Internet service provider  does not                                                               
violate the law unless the ISP  knows the sender is violating the                                                               
law.    He  said the  word  "unless"  contradicts  Representative                                                               
Gara's intent to hold only e-mail senders liable.                                                                               
                                                                                                                                
Number 2232                                                                                                                     
                                                                                                                                
REPRESENTATIVE GARA responded  that he agrees and  would favor an                                                               
amendment that ended  the sentence on page 3, line  12, after the                                                               
word  "sender."    If  amended,  the  sentence  would  read,  "An                                                               
intervening interactive computer service  does not violate (a) of                                                               
this section by handling or  retransmitting the message initiated                                                               
by a sender."   He said, whatever  the language on page  3, HB 36                                                               
on page  4 limits an  Internet service provider's liability.   He                                                               
noted for the record that  one of the Internet service providers,                                                               
GCI,  has reviewed  the bill  and is  comfortable with  it; GCI's                                                               
letter of support is in the bill file.                                                                                          
                                                                                                                                
REPRESENTATIVE ROKEBERG said he does  not like laws or bills that                                                               
are inconsistent.   The result  is more ammunition  for lawsuits,                                                               
and the public is confused.                                                                                                     
                                                                                                                                
REPRESENTATIVE LYNN  asked what  happens if someone  from another                                                               
country violates this bill.                                                                                                     
                                                                                                                                
REPRESENTATIVE GARA  replied that  HB 36  would not  regulate the                                                               
junk e-mails that originate in other countries.                                                                                 
                                                                                                                                
Number 2103                                                                                                                     
                                                                                                                                
REPRESENTATIVE  GUTTENBERG  asked  what really  changes  for  the                                                               
average person if HB 36 passes.                                                                                                 
                                                                                                                                
REPRESENTATIVE GARA  said HB 36  gives the state  and individuals                                                               
tools to  get themselves off e-mail  lists.  The bill  requires a                                                               
link, an  e-mail address, and  a local or toll-free  phone number                                                               
to use to  be removed from the sender's list.   Many e-mails from                                                               
California  now  have  these  valid links,  the  result  of  that                                                               
state's  legislation.   If  Alaska and  other  states follow  the                                                               
other  27 states  in cracking  down on  junk e-mails,  eventually                                                               
there  will  be  less of  them.    Of  course,  the law  must  be                                                               
enforced.  If people thumb their  noses at the law, hopefully the                                                               
bill's enforcement tools can be used against them.                                                                              
                                                                                                                                
REPRESENTATIVE  ROKEBERG  asked Mr.  Sniffen  how  HB 36  affects                                                               
interstate  commerce.   Typically,  the person  sending the  spam                                                               
will  be  outside   Alaska.    He  asked  how   Alaska  will  get                                                               
jurisdiction   over  that   individual  or   company  to   pursue                                                               
prosecution, and whether a federal or state court would be used.                                                                
                                                                                                                                
Number 1961                                                                                                                     
                                                                                                                                
MR.  SNIFFEN admitted  that it  is difficult  to enforce  many of                                                               
these  laws when  so many  violators who  are preying  on Alaskan                                                               
victims are out of state.   In HB 36, Alaska asserts personal and                                                               
subject  matter jurisdiction  over  these violators  if they  are                                                               
conducting  business  within  the  state by  sending  e-mails  to                                                               
Alaskan ISP addresses.   For jurisdiction, a court  case under HB                                                               
36 is a civil suit.  The department  can only go after money.  In                                                               
that process,  the department  would sue  people in  state court,                                                               
get  judgments  against  them,  and then  try  to  enforce  these                                                               
judgments in whatever  state the company happened  to be located.                                                               
The  department  works with  law  enforcement  agencies in  other                                                               
states to  get help with these  efforts.  On some  occasions, the                                                               
department convinces the  other states to bring  actions in their                                                               
own state  courts against  these people  for violating  their own                                                               
state laws.  Nine out of  ten times, if the business is violating                                                               
an  Alaska law,  it's also  violating  the same  law wherever  it                                                               
happens to be.                                                                                                                  
                                                                                                                                
Number 1877                                                                                                                     
                                                                                                                                
MR. SNIFFEN  responded to a request  from Representative Rokeberg                                                               
to  describe  how the  department  works  with another  state  to                                                               
enforce consumer  protection laws.   In  one case,  the Minnesota                                                               
AG's  [attorney general's]  office called,  asking for  help.   A                                                               
person in  Alaska was committing  Internet fraud,  selling things                                                               
on  an Internet  site,  and  taking money  with  no intention  of                                                               
delivering the merchandise.  The  department referred the case to                                                               
the Alaska  State Troopers,  who made an  arrest and  stopped the                                                               
guy from further activity.                                                                                                      
                                                                                                                                
In  another case,  the Alaska  Department of  Law approached  the                                                               
Florida  attorney general's  office about  stopping someone  from                                                               
sending unsolicited  faxes to Alaska.   Florida officials located                                                               
the  company and  sent  it cease-and-desist  letters.   Once  the                                                               
company knew  the local agency  was after it, it  stopped sending                                                               
faxes  to  Alaska,  and  the Alaska  Department  of  Law  stopped                                                               
getting  complaints.   The department  never  recovered money  or                                                               
judgments from the company, but it was able to stop the conduct.                                                                
                                                                                                                                
Number 1810                                                                                                                     
                                                                                                                                
REPRESENTATIVE  ROKEBERG noted  that HB  36 provides  the private                                                               
right  of  action and  asked  Mr.  Sniffen  what legal  path  the                                                               
citizen  would follow.   And  if the  citizen has  a solid  case,                                                               
would the department recommend the person take a private action?                                                                
                                                                                                                                
MR. SNIFFEN replied  that private citizens are bound  by the same                                                               
rules as  the Department  of Law,  but citizens  are given  a few                                                               
more  incentives.   Citizens can  get their  full attorney  fees,                                                               
which the  state cannot  recover, and  unlike the  state, private                                                               
litigants  can recover  treble  damages.   His  office follows  a                                                               
procedure in getting complaints.   If the complaint is widespread                                                               
and affects  a large number  of people in Alaska,  the department                                                               
reviews  it  for a  potential  investigation  and lawsuit.    Mr.                                                               
Sniffen  said he  tells  consumers that  if  they need  immediate                                                               
relief, they  should hire an  attorney and go after  the violator                                                               
themselves.  These two approaches  are not mutually exclusive, he                                                               
said.  In  some consumer cases, the state can  get penalties that                                                               
the  private  litigant  cannot.    Mr.  Sniffen  said  it's  very                                                               
difficult  for  the  average  mom-and-pop  consumer  to  hire  an                                                               
attorney because  of the expense.   Alaska's  consumer protection                                                               
Act  alleviates this  barrier by  allowing the  recovery of  full                                                               
attorney fees and  treble damages.  Mr. Sniffen said  he talks to                                                               
many  consumers   who  never  file   actions  because   they  are                                                               
intimidated by attorneys  or fear that it will be  a lot of work.                                                               
He said his office can only encourage citizens so much.                                                                         
                                                                                                                                
REPRESENTATIVE ROKEBERG noted the language  on page 4, lines 8-9,                                                               
which gives  an employer standing  to bring  a legal action.   He                                                               
asked  if  the  word  "includes" confuses  or  expands  the  term                                                               
"recipient".                                                                                                                    
                                                                                                                                
Number 1635                                                                                                                     
                                                                                                                                
MR. SNIFFEN replied  that he reads "includes" as  an expansion of                                                               
who  is a  recipient, that  it  covers employers  with staff  who                                                               
receive these junk  e-mails.  For example, as an  employee of the                                                               
Department  of Law,  he  receives 30  spam e-mails  a  day.   The                                                               
Department of  Law would  be an  employer under HB  36, so  if it                                                               
wanted to bring an action  against senders of those spam e-mails,                                                               
it could do so.                                                                                                                 
                                                                                                                                
CHAIR  ANDERSON   asked  whether   there's  a   possible  federal                                                               
solution.                                                                                                                       
                                                                                                                                
Number 1561                                                                                                                     
                                                                                                                                
REPRESENTATIVE GARA  answered that  a stringent  federal solution                                                               
would  be ideal,  but legislation  dies in  Congress every  year.                                                               
Existing  federal and  state laws  already prohibit  fraud in  e-                                                               
mails, but they don't regulate general e-mail conduct.                                                                          
                                                                                                                                
CHAIR ANDERSON  asked about  the prospects  of enforcing  the new                                                               
law.                                                                                                                            
                                                                                                                                
REPRESENTATIVE  GARA said  he  agreed with  the  comments of  Mr.                                                               
Sniffen.  The department has to  make choices about what cases it                                                               
takes.   The Fair Business  Practices Section has a  very capable                                                               
but limited  staff; they take the  cases which they think  can do                                                               
the  most good  for the  public.   That's also  why HB  36 allows                                                               
private  citizens   to  use  the  remedies   under  the  consumer                                                               
protection Act.  Most states  do not allow the attorney general's                                                               
office and individual victims to  enforce the law.  Employers and                                                               
Internet  service providers,  who  probably  have more  resources                                                               
than citizens,  can also initiate  legal action.  He  said nobody                                                               
is  going to  get rich  off this  law; remedies  in the  consumer                                                               
protection law  are treble damages  or a $500 fine,  whichever is                                                               
greater.                                                                                                                        
                                                                                                                                
Number 1391                                                                                                                     
                                                                                                                                
REPRESENTATIVE  GARA replied  to a  question from  Representative                                                               
Rokeberg  about  whether people  bringing  civil  action have  to                                                               
quantify the  damages.   If the consumer  can quantify  the harm,                                                               
the person is  entitled to recover treble damages.   The consumer                                                               
protection Act recognizes  that in most cases  of consumer fraud,                                                               
the  actual  damages  are  small,   so  the  $500  fine  is  also                                                               
available.  In other states  that have the treble damages clause,                                                               
it serves as  an incentive to get the business  to start engaging                                                               
in proper conduct.                                                                                                              
                                                                                                                                
REPRESENTATIVE ROKEBERG said  that a $500 fine is not  much of an                                                               
incentive for a citizen to bring a private cause of action.                                                                     
                                                                                                                                
REPRESENTATIVE GARA  said Alaska  law changed several  years ago,                                                               
adding the incentive of full compensation for attorney fees.                                                                    
                                                                                                                                
REPRESENTATIVE  ROKEBERG  asked  whether many  individuals  could                                                               
file complaints, thereby running up higher fines.                                                                               
                                                                                                                                
REPRESENTATIVE  GARA  replied  that  in  the  original  bill,  he                                                               
considered limiting the  number of lawsuits to the  first five or                                                               
ten cases.  He said that approach was unworkable.                                                                               
                                                                                                                                
Number 1165                                                                                                                     
                                                                                                                                
MR.  SNIFFEN added  that the  consumer protection  Act recognizes                                                               
that  the  fines  and  penalties  are  per  violation.    For  an                                                               
employer, if 50 employees each  received an e-mail, the potential                                                               
fine could equal  50 violations times $500.   Case law recognizes                                                               
that the fine applies per transaction.                                                                                          
                                                                                                                                
Number 1040                                                                                                                     
                                                                                                                                
CHAIR  ANDERSON   said  since   several  committee   members  are                                                               
cosponsors  on  HB   36  and  have  indicated   that  they  don't                                                               
understand  the changes  in the  proposed CS,  he would  hold the                                                               
bill.  Therefore,  it's not appropriate to  discuss amendments at                                                               
this time.   But  he said  he will hold  open the  public hearing                                                               
because there's strong  evidence of public support  for the bill.                                                               
He  intends  to   bring  it  back  before   the  committee  after                                                               
conferring with members, perhaps next week.                                                                                     
                                                                                                                                
REPRESENTATIVE  GARA clarified  that his  cosponsors signed  onto                                                               
this proposed CS  for HB 36 and  have seen the CS  except for the                                                               
one-word change he described earlier.                                                                                           
                                                                                                                                
Number 0870                                                                                                                     
                                                                                                                                
REPRESENTATIVE LYNN  said he fully  supports HB 36 and  will vote                                                               
for  it when  it returns  to  the committee.   He  said it  won't                                                               
change the world, but it's a good step in the right direction.                                                                  
                                                                                                                                
CHAIR  ANDERSON  suggested  that Representatives  Guttenberg  and                                                               
Rokeberg work with Representative Gara on  a revised CS for HB 36                                                               
to bring  back before  the committee.   [House  Bill 36  was held                                                               
over.]                                                                                                                          

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