Falling into a fax trap

That’s why Hamilton, vice president and general manager of Springfield-based Electronic Video Systems, was surprised to receive a letter from an attorney representing a private school near Kansas City that accused EVS of sending out faxes illegally. The letter demanded EVS pay the attorney $3,000.

The Kansas City attorney claimed Hamilton’s company violated the Telephone Consumer Protection Act of 1991, which prohibits companies from sending unsolicited fax letters to businesses with which they have had no pre-existing relationships.

Hamilton said EVS didn’t have an established relationship with the school, and EVS attorney Michael Cosby of Blackwell Sanders Peper Martin LLP settled the case out of court for $1,000, without admitting guilt.

“(The fax) was just making them aware that we’re a dealer that handles this product, and as your purchasing needs come about, be sure to contact us,” Hamilton said. “It’s not really that much different than calling them up on the phone.”

Both Hamilton and Cosby declined to name the private school or the attorney acting on the school’s behalf.

Unsolicited, or junk, faxes are a problem throughout the state. Jim Gardner, spokesman for the Missouri office of the Attorney General, said that in 2004, unsolicited faxes were ranked fourth on Missouri’s list of the top 10 consumer complaints, with a total of 1,148 complaints.

The junk fax issue has received national attention of late, as the U.S. House June 28 passed the Junk Fax Prevention Act of 2005, stating that businesses can only send unsolicited fax letters to companies with which a business relationship exists. It awaits President Bush’s signature.

EVS receives several unsolicited faxes a day, Hamilton said, adding that the fax that cost his company $1,000 was one of about 20 EVS sent. If he’s not interested in the faxes he receives, Hamilton throws them away and doesn’t consider legal action against the senders.

“To me, the critical issue nowadays is spamming,” Hamilton said. “I’m deleting 200 to 300 emails every day for various things like Viagra. That’s a lot more of a time waster than throwing away a piece of paper from a fax machine.”

The Junk Fax Prevention Act is an evolution of 1991’s Telephone Consumer Protection Act.

On July 3, 2003, the Federal Communications Commission released the Junk Fax Prevention Act to revise many of its telemarketing and facsimile advertising rules pursuant to the Telephone Consumer Protection Act of 1991.

The FCC’s rules would have made it illegal for businesses to send faxes to even longtime customers without specific written permission. It was set to begin July 1.

Passage of the Junk Fax Prevention Act is good for small businesses and their customers, said Thomas M. Sullivan, chief counsel for advocacy for the U.S. Small Business Administration Office of Advocacy, in a news release. “Junk faxes remain illegal, but real estate agents can still fax listings based on a telephone request, jobbers can fax updated price lists to stores, and caterers can fax menus to brides-to-be,” Sullivan said.

The Junk Fax Prevention Act of 2005 now requires senders to send faxes only to numbers received from customers or found on Web sites, advertisements or directories. Senders also must provide recipients with a way to opt out of receiving unsolicited faxes, such as a notice on the first page.

At Hamilton’s request, Cosby is drafting such a new fax cover sheet for EVS’ use.

“But the biggest bulk of the problem is the amount of time and effort we have (to spend) to be cognizant of how we do business,” Hamilton said. “Do we have to pull a three-ring binder out and look to see if this is an approved person?”

Fines for sending unsolicited faxes range from $500 to $1,500 per page.

“Five hundred dollars per page is the statutory damage, but if the plaintiffs can show that it was willfully done – and there’s no appellate or supreme court decisions in the state of Missouri defining what a willful violation of the statute is – you’re entitled to, at the court’s discretion, three times the amount in damages,” Cosby said.

The full text of the Junk Fax Prevention Act (S. 714) is available online at www.thomas.loc.gov.

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