Fined Aliso Viejo firm countersues to protect its perceived right to send unsolicited fliers. Foes call it intimidation.
The Los Angeles Times
An Orange County business that has been fined millions of dollars for sending unwanted faxes is suing more than a dozen people who turned to the courts to stop the flow of so-called junk faxes.
The lawsuit filed this month by Fax.com in Orange County Superior Court, alleges that the defendants abused the legal system by coordinating small-claims actions in an effort to drive the Aliso Viejo-based company out of business.
“Here they go out and sue you for trying to stop these junk faxes,” said Internet entrepreneur Steven T. Kirsch, who sold his dot-com business Infoseek in 1999 for millions of dollars.
Kirsch operates a website, http://www.junkfaxes.org, as a clearinghouse for people wanting to eliminate unwanted faxes. He also has a small-claims action pending against Fax.com, in addition to a class-action lawsuit.
His attorney described Fax.com’s legal tactic as an “intimidation lawsuit” that seeks to dissuade Kirsch and others from taking further action in court.
“It’s amazing you have people who have broken the law” filing suits against those who are trying to stop them, said attorney Michael Grobaty.
Most of the legal actions against Fax.com cite the federal Telephone Consumer Protection Act of 1991, which bans junk faxes. But enforcement has been slow, in part, because of Fax.com’s unsuccessful challenge to the act, which the U.S. Supreme Court in January refused to hear.
Fax.com officials didn’t return phone calls. The company characterized the class-action complaints as “unfounded and absurd” on its website.
The business was fined $5.4 million in January by the Federal Communications Commission for sending unsolicited faxes. The fine hasn’t been paid and the case has been referred to the U.S. Department of Justice, an FCC spokeswoman said.
Fax machine owners say unwanted faxes waste toner and paper and tie up telephone lines.
“It unfairly shifts the cost of advertising,” said Kevin Tripi, an Irvine attorney, who has filed a suit against Fax.com on behalf of a local business. “With junk mail someone else has paid for stamps and the envelope.”
Lawrence Markey Jr., an attorney with the Santa Monica-based Foundation for Taxpayers and Consumers Rights, said he learned first-hand about Fax.com’s legal tenacity.
When an unwanted fax was sent to his home, he sued the company in small-claims court. He won a $2,500 judgment, after representatives from the company failed to show up.
The company filed a motion to vacate the order and through Charles R. Martin, a vice president of Fax.com and private investigator, argued the company had never heard of the case.
But Markey collected the judgment after he played a telephone message that Martin left, acknowledging the case but saying that he had to be out of town the day of the hearing, according to public documents.
“Then they sent a letter to the state bar complaining about me, saying that I filed frivolous claims against the company,” Markey said.