PITNEY BOWES PAYS OUT $ 2.9Mil IN BLAST-FAX SETTLEMENT …..

[Anonymous]

http://www.law.com/jsp/law/LawArticleFriendly.jsp?id=1202433486480
In $2.9 Million ‘Blast Fax’ Settlement, Plaintiffs Get Coupons and Lawyers Get Cash
Business
service and supply giant Pitney Bowes has agreed to settle a “blast
fax” class action by giving $26 coupons to plaintiffs for each week
they received an unwanted fax — and $950,000 to the lawyers for the
class.The $2.9 million settlement ends a case originally filed in Cobb
County, Ga., before being transferred to federal court. It began with
Pitney Bowes’ 2007 purchase of the corporate assets of Laser Life, a
Marietta, Ga.-based supplier of toner and other printer products,
according to court filings.Among those assets was Laser Life’s client
list, which included more than 3,000 fax-machine numbers the company
used to advertise its products. When Pitney Bowes assumed the
operation, it began sending out promotional advertisements for its
products to those numbers, according to the original complaint.

Among
the recipients was attorney Martin K. O’Toole, a partner in Marietta’s
Griffin & O’Toole, who began receiving the faxes in August 2007. In
November, Decatur, Ga., attorney Henry A. Turner and Birmingham, Ala.,
lawyer Samuel M. Hill — who specialize in suits alleging violations of
the Telephone Consumer Protection Act of 1991 — filed suit against
Pitney Bowes, seeking class status with O’Toole as the class
representative.Under the TCPA, a fax advertisement may be mailed only
with the permission of the recipient, or if there is an existing
business relationship, or EBR, between the sender and the
recipient.”Their argument was that they had bought the assets and
customer list of [Laser Life], and that therefore they had an EBR with
everybody on that list,” said Turner.

But, he said, the 2005
Junk Fax Prevention Act included a provision barring the transfer of
EBRs.”We argued that EBRs cannot be assigned,” he said. “If they’d
bought the stock of the company, that might have offered some
protection … but all they bought were the assets.”There was also a
problem with the mandatory “opt-out” notice, he said, which must
conform to very specific guidelines, including prominent type and
placement, a notice that the fax sender must comply with an opt-out
request within 30 days of the request, and the inclusion of both a
24-hour opt-out telephone number and fax number. The faxes in question
included an opt-out number, but it was in small type and simply read:
“To be removed please call” a 1-800 number and extension.

The
parties agreed to voluntary mediation, and after two days of “some of
the most intense mediation I’ve been through,” said Turner, settlement
was reached under which each member of the class will receive a coupon
worth $26 toward any $100 purchase of ink or toner from Pitney Bowes
for each week they received one of the faxes, with a $2 million cap on
redeemed coupons.Along with Turner and Hill’s $950,000, the order,
signed on Aug. 3 by U.S. District Judge Harold L. Murphy, also
guarantees O’Toole, as class representative, $5,000.

Under the terms of the settlement, Pitney Bowes admitted to no wrongdoing.
Pitney
Bowes was represented by Robins, Kaplan, Miller & Ciresi partners
Lisa L. Heller and Marla R. Butler and associates Meredith H. Ragains
and Jennifer A. Adler. Neither Heller nor Butler responded to requests
for comment, and Pitney Bowes spokeswoman Carol Wallace said that the
company would have no comment.Nor could she comment on another case
stemming from Pitney Bowes’ apparent efforts to recoup its expenses
elsewhere. According to a suit originally filed in Fulton County then
transferred to federal court, the company claims that the former owner
of Laser Life, Bob N. Fox, breached the terms of the $12 million sale
of his company’s assets by not disclosing that, several months before
closing the deal, his company had itself violated the TCPA and been
notified that a complaint might follow.

The company is seeking $3 million in damages.
The
suit was filed by Fox when Pitney Bowes attempted to recover more than
$800,000 in an escrow fund set up as part of the Laser Life sale,
asserting that Fox owed the company for its losses resulting from the
O’Toole settlement.”It is ironic that Pitney Bowes seeks to recover
from Mr. Fox amounts which Pitney Bowes paid to settle claims which it
has consistently asserted have no basis as a matter of law,” said
attorney William B. Ney, who is representing Fox along with Theodore A.
Erck Jr.

While it’s true that Fox settled what Ney termed a
“nuisance TCPA claim” prior to his company’s sale, the O’Toole claims
all occurred afterward, said the lawyer.”The O’Toole Plaintiffs never
alleged that Mr. Fox or his company had violated the TCPA in any way,”
Ney said via e-mail. “Pitney Bowes never tendered the defense of the
O’Toole case to Mr. Fox and never notified Mr. Fox of its contention
that the O’Toole claims were indemnifiable until the eve of settlement
— after Pitney Bowes had litigated the case for over a year.”The
settled case is O’Toole v. Pitney Bowes, No. 1:08-cv-01645. The pending
case is Fox v. Pitney Bowes, No. 1:09-cv-01028.

[Author]

September 1, 2009 at 10:09 AM