Fax.com Falters in Bid to Overturn US Marketing Curbs

14 January 2004

Controversial US firm Fax.com has suffered a major setback in its attempts to overturn fax marketing regulations.

The group -- last week fined $5.4 million (€4.2m; £2.9m) by the Federal Communications Commission for falling foul of do-not-fax rules [WAMN: 07-Jan-04] -- has been told the Supreme Court will not hear its case against the ban on unsolicited ads sent by fax.

The dispute goes back to attempts by Missouri's attorney general, Jeremiah W Nixon, to enforce the FCC's fax marketing rules. Introduced in 1991, these state that marketers need written permission from the recipient before they can fax an ad, unless there is an existing business relationship between the two.

Fax.com took Nixon to court, arguing that the ban on unsolicited commercial faxing was unconstitutional as it impinged on First Amendment rights to free speech. The suit claimed the law was illogical, since faxing information without prior permission -- as opposed to ads -- was still allowed, even though both activities use up recipients' resources.

These arguments were accepted by US District Court judge Stephen N Limbaugh, who declared the regulations unconstitutional [WAMN: 01-Oct-02] -- a decision that was subsequently overruled by an appeals court. Now the Supreme Court has refused to hear the suit, the case passes back to judge Limbaugh, who will decide on damages.

The Supreme Court's decision may have a bearing on the lawsuits filed by telemarketing groups against recently-introduced do-not-call regulations, though the sponsor of one of the suits, the American Teleservices Association, insists the issues involved are different.

Data sourced from: AdAge.com; additional content by WARC staff