California forced to defend 'junk fax' law
U.S. Chamber of Commerce challenges state law, set to take effect on Jan. 1, saying it hurts small businesses.
A law designed to ban marketers from sending unsolicited faxes was set to take effect in California on Jan. 1, 2006, but SB 833 is being held up in court after the U.S. Chamber of Commerce issued a legal challenge.
In a joint effort with fax company Xpedite Systems, the Chamber of Commerce filed a lawsuit in Sacramento federal court and on Wednesday won an injunction that will stay the law at least until Jan. 31, 2006. A hearing is scheduled for Jan. 23.
At issue is California's decision to write a tougher law than the Junk Fax Prevention Act passed by the U.S. Congress last summer. The federal law allows companies to send faxes to people or businesses they have had prior business dealings with, but the California law doesn't.
Even "if you've been doing business with someone for years, then you have to take on some significant costs to comply with (the California) law," said Amar Sarwal, general litigation counsel for the U.S. Chamber of Commerce, a nonprofit business advocacy group. "We think this will make it hard on small- and middle-size business and maybe some larger ones."
Ironically, the U.S. Chamber of Commerce was among the biggest backers of the federal anti-junk-fax law. In recent years, the U.S. government has tried to respond to the nation's fax machine owners, who have blamed higher paper and ink costs on the blizzard of junk faxes they receive.
State Senator Debra Bowen, a Democrat, says the federal law doesn't go far enough to protect fax machine owners. Allowing marketers an exemption just because they say they had a prior relationship with someone is no good unless they can prove it, she asserts.
"In the federal law, there is no requirement for anyone to demonstrate that a prior business relationship existed," Bowen said. "Anyone could say, 'I had a business dealing with someone way back when,' and we'd have to take them at their word."
Both California and federal laws allow recipients of illegal faxes to sue the sender. If a court finds that a sender willfully or knowingly violated the law, it can award a recipient up to $1,500 per violation.
Bowen said she's confident that California is on sound legal footing and that Americans from across the country would support such a law.
"I've received zero calls from anyone demanding their constitutional right to receive more junk faxes," she said.