Posted on: Friday, August 23, 2002

Executive sues junk faxer for $2.2 trillion

By Brian Bergstein
Associated Press

SAN JOSE, Calif. — Fed up with unwanted ads for phone accessories, credit services and stock tips coming in on his fax machine, a Silicon Valley executive sued a company that sends bulk faxes yesterday, demanding an attention-getting $2.2 trillion in damages.

Yes, $2.2 trillion — or about $100 billion more than this year's total federal budget.

It might seem wildly inflated, but technology entrepreneur Steve Kirsch believes that's the total amount consumers should get if the proper penalty is assessed for each and every junk fax, and the damages are tripled as federal law allows. The suits seek class-action status.

An unwanted fax wastes 10 cents, Kirsch estimates, if you factor in the cost of paper, ink, wear and tear on the fax machine and the time lost in sorting through all the incoming.

Kirsch, founder and chief executive of Propel Software Corp. in San Jose, filed the suits simultaneously in Santa Clara County Superior Court and U.S. District Court in San Francisco.

Both target Fax.com, an Aliso Viejo-based company that sends bulk fax advertisements, and as many as 10,000 advertisers.

The state suit also names Cox Business Services, a subsidiary of Atlanta-based Cox Communications Inc., because Fax.com uses network equipment it bought from Cox.

Fax.com's CEO, Kevin Katz, characterized the allegations as "unfounded and absurd." Cox spokesman Bobby Amirshahi declined to comment on the litigation.

In 1991, Congress passed the Telephone Consumer Protection Act, which restricted telemarketers' activities but also let junk fax recipients sue their senders for up to $1,500 per fax. To qualify as illegal, a fax must be unsolicited and advertise some product or service for sale.