• News Update: Restaurant Fax Spam

Video Transcript:

In an effort to boost business, a local restaurant sends out coupons for drink and food specials. But because of the way they did it, they’ve been hit with a lawsuit for $5 million. In a sluggish economy, everyone wants to improve business. The way to do that is get the word out about what you’re offering. Some people stand on the corner begging customers to come in. Others try the internet using social websites or emails. And then there are the phone calls and fax blasts. Do it right, and you increase business and make more money. Do it wrong, and you may get sued. In a case like this where there’s approximately 5000 faxes at stake, at a minimum, it’s $2.5 million dollars that they’re facing for liability that could easily go to $7.5 million.

At Ole Ole Mexican Cantina in Novi, they wanted to sell more Margaritas and chicken fajitas. It sounded like it was a great idea at the time. They put together this flyer pointing out they were voted for best Mexican restaurant. They offered $3 drinks and two-for-one entrees. Then they hired a PR firm that was working the neighborhood offering to send them out to local businesses and residents. Lettuce, tomato, meats, we get faxes every day from people trying to sell us their goods and their businesses. This company offered us the same thing. Why wouldn’t we join in selling our goods to people in the neighborhood, in the businesses? The faxes went out.

But some area businesses didn’t like their fax machines and phone lines being clogged up with unsolicited junk faxes that waste toner and time. Congress passed the act to prohibit anyone from sending out faxes without permission. So they just slapped Ole Ole with a lawsuit for sending unwanted promotional materials.

If you have sent out a fax without permission, and you didn’t have a prior existing business relationship with that receiver, then you violated the statute. Attorney Jason Thompson says the law is clear. You can’t do it. It’s a stiff penalty designed to put an end to this spamming if you will, the blast faxing of these businesses.

And several people we spoke with say, it’s time to put a stop to uninvited solicitors. Most of the ones I get are from vendors trying to sell me their product. Some days like we will get like 10 of them, 12 of them. And I think it’s a waste of paper and ink of your fax machine. It’s expensive. Now the most anyone who receives an unwanted solicitation can win is $500, but the attorney is rounding up everyone who Ole Ole faxed. He says, when he’s done, the fine could add up to more than $5 million if the restaurant loses. That’s going to kill us. I mean that’s a lot of money that they want for us to pay for a company. We hired a company. We didn’t do it ourselves. And there is a number saying, please discontinue. Why wouldn’t they have called? Thomas says, it may be a big hit for a small restaurant, but this is about protecting all of us from businesses who go too far. That’s why Congress I think enacted this is to free up the businesses to do the business that they are supposed to be doing. Ole Ole says they plan to fight this out to the end. The plaintiffs say the Supreme Court has issued favorable rulings in similar cases. This battle will take place in federal court later this year.

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