Unsolicited Fax Ads Put Your Business at Risk

Fax “spamming” is against the law, and the risks of litigation far outweigh the commercial benefits

Some of our clients have been sued (or threatened with lawsuits) under a 1991 federal law, the Telephone Consumer Protection Act (TCPA). One of the provisions of that law makes it “unlawful for any person within the United States … to use any telephone facsimile machine, computer, or another device to send an unsolicited advertisement to a telephone facsimile machine.”

The statute further defines “unsolicited advertisement” as “any material advertising the commercial availability or quality of any property, goods, or services which is transmitted to any person without that person’s prior express invitation or permission.”

In short, any unsolicited fax sent for the purpose of advertising the products or services of any business within the U.S. subjects the sender to civil liability under the TCPA. Moreover, TCPA lawsuits can be filed in state court:

• by any business or individual who receives an unsolicited fax advertisement,
• by the state attorney general, and, potentially,
• by large groups of class action plaintiffs.

COSTLY DAMAGES

Most troubling, however, are the damages that plaintiffs can recover in such lawsuits, regardless of whether or not the fax sender intended to violate the TCPA or even knew of its existence. Thus, in addition to issuing an injunction, the court may award the plaintiff his or her “actual monetary loss from such a violation, or … $500 in damages for each such violation, whichever is greater.”

Because fax advertisements are often sent to hundreds and even thousands of recipients, the potential damages under the TCPA can be enormous, given that a minimum of $500 can be assessed for each fax. Furthermore, if the plaintiff can prove that the defendant “willfully or knowingly” violated the TCPA, the court may triple the amount of damages otherwise recoverable.

The recent spate of TCPA lawsuits in Phoenix appears to be attributable to a handful of local attorneys who must view such litigation as a promising source of income. We therefore want to advise you of this situation and urge you to be wary of any company that offers to provide you with mass faxing services to large lists of businesses or other potential customers.

IGNORANCE NO DEFENSE

The TCPA has been frequently attacked on constitutional and other grounds, but we are unaware of any successful challenges.

In addition, as mentioned above, ignorance of the law is not a defense to any TCPA lawsuit, nor can a defendant escape liability by including a telephone number that the recipient of his or her unsolicited fax can call to indicate that they do not wish to receive any further faxes. The only safe course of action, therefore, is not to send—or allow others to send—any unsolicited faxes as a method of advertising your business.