Anyone with a fax machine or fax account has received them – ads for vacations in Orlando, Las Vegas or Cancun; the latest mortgage rates and refinancing options — fabulous offers all! Like autumn leaves, they fall from paper fax machines or clog the gutters of online fax accounts. Some ads are legit. Others, not so much.
Companies that send advertisements by fax, so-called “junk faxes,” to potential customers should pay close attention to the FCC’s latest rules. Otherwise, unhappy recipients of those faxes will make advertisers pay good money for violating them.
The Telephone Consumer Protection Act (TCPA) and the Junk Fax Prevention Act (JFPA) are the laws that restrict the use of fax machines for advertising. The FCC wrote, and continues to write, lots of detailed, byzantine regulations that create pitfalls and opportunities for those who send or receive faxes.
In its October 30 order, the FCC confirmed that specific “opt-out notices” are required on all fax ads. The FCC’s opt-out rules apply to all faxed ads, including those sent with the recipient’s prior express permission or based on a prior existing business relationship, and each opt-out notice must:
- Be clear and conspicuous.
- State on the first page of the ad that the recipient may make a request to the sender not to send any future ads and that failure to comply, within 30 days, with such a request is unlawful.
- Contain a domestic contact telephone number and fax number for the recipient to transmit an opt-out request.
The FCC said that any opt-out notice not satisfying all of these requirements is deficient.
Among other nastiness, a violation of these laws could subject the fax advertiser to liability for up to $1,500 for each fax sent.
Companies can be sued for the actual monetary loss that resulted from the TCPA violation or up to $500, whichever is greater. But, if the court finds that the company willingly or knowingly committed the violation, then fines can be tripled for each violation. The FCC can impose civil monetary penalties of up to $11,000 for violations and state attorneys general may bring suits in federal court for actual damages or $500 per violation, with treble damages for knowing and willful violations.
One of the blunt-force tools available to recipients of unwanted faxes is a class action lawsuit. Because fax advertisers tend to transmit massive numbers of faxes (blast faxes), the potential for multi-million dollar damages is real. Inattention to the rules can trip even the biggest of companies.
In one recent case, MetLife agreed to pay $23 million to settle a class action lawsuit alleging it sent millions of unsolicited faxes. The Wall Street Journal Online reported that the payouts from the settlement will be between $50 and $3,500 per claim, based on the number of faxes received and phone lines in place.
If you are a mass advertiser or receive these kinds of unsolicited offers and would like to know more about your rights, responsibilities and potential liability, call us. As a former FCC attorney and a lawyer in both private practice and in-house counsel to telecommunications firms, I can help you understand how the law applies to you.