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California Enacts Unsolicited Fax Bill

California's governor has signed into law a bill regulating unsolicited faxes that does not contain an established business relationship (EBR) exemption. The law takes effect January 1, 2006, and is not pre-empted by the new federal Junk Fax Act.

The bill, S.B. 833, was introduced after the FCC delayed enforcement of a controversial provision abolishing the EBR exemption. The FCC's delay allowed Congress to pass and President Bush to sign legislation that restored the EBR exemption to federal law governing unsolicited faxes.

California's law prohibits a person from sending an unsolicited advertisement to a telephone fax machine if the sender or the recipient is located in California. An unsolicited advertisement is any material advertising goods or services that is transmitted to a person without that person's prior express invitation or permission. Prior express invitation or permission may be obtained for a specific or unlimited number of advertisements and may be obtained for a specific or unlimited period of time.

In addition, all faxes sent from or to California must contain the date and time the fax is sent, an identification of the sender, and the telephone number of the sender. This information must appear on the first page or at the top or bottom of every transmitted page.

The statute does not apply to faxes sent by or on behalf of a tax-exempt professional or trade association if the fax is sent to a member of the association in furtherance of the tax-exempt purpose and the recipient voluntarily provided a fax number, the fax is not primarily for the purpose of advertising goods or services of a third party, and the recipient has not opted-out of receiving faxes from the association.

The statute allows private plaintiffs to file suit and provides remedies of actual damages or statutory damages of $500 per violation, and/or injunctive relief. A court can triple the damages if it finds the defendant willfully or knowingly violated the statute.

There is some debate about whether states can regulate interstate calls; several trade groups have asked the FCC to rule that the FCC has exclusive jurisdiction over interstate calls and faxes under the Telephone Consumer Protection Act (thus preempting the enforcement of more restrictive state laws, such as California's, as applied to calls that cross state lines). However, most state Attorneys General do not support this view and they, as well as plaintiffs' attorneys, may well seek to enforce state telemarketing laws with respect to both intrastate and interstate calls and faxes.

This client alert is a publication of Loeb & Loeb and is intended to provide information on recent legal developments. This client alert does not create or continue an attorney client relationship nor should it be construed as legal advice or an opinion on specific situations.

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