How an Orthodox High School Takes Spammers to Court — and Reaps Rewards
Image by Forward Montage
By Josh Nathan-Kazis May 25, 2016
Sometime in the late morning of November 27, 2012, a fax machine rang at a high school for Orthodox girls in Rockland County, New York.
The message that spooled out of the machine’s printer was an invitation to an information session about a London-based university.
The Orthodox school’s response to the fax? A lawsuit, filed in federal court against the London-based university.
It wasn’t the school’s first time suing over a fax. Bais Yaakov of Spring Valley, located on a quiet suburban street near the town of Monsey, New York, has initiated at least seven class action lawsuits since 2011 under a federal law that restricts faxed advertisements.
That federal law dates from the 1990s, when spam faxes tied up phone lines and used up printer paper. Now, with many businesses using virtual fax machines that deliver incoming messages as digital files, the cost of spam faxes is often negligible.
Yet spam fax lawsuits are a growth industry among enterprising tort lawyers, with the number of new cases skyrocketing since 2012. But Bais Yaakov is a highly unusual spam fax suit plaintiff, experts told the Forward. Not-for-profits rarely act as lead plaintiffs in these cases, and experts said they had never heard of a school bringing a spam fax suit.
Bais Yaakov has sued companies in Massachusetts, New York and Minnesota. In three separate lawsuits, the school has sued ACT, Inc. — the company behind the ACT college readiness test, Alloy, Inc. — the firm that created the Gossip Girl teen romance series and the publisher Houghton Mifflin Harcourt.
“People bring these cases to me because they’re sick and tired of being bombarded with robocalls [and] faxes that tie up their telephone lines and interfere with their businesses,” said Bais Yaakov’s attorney in all of its spam fax cases, Aytan Bellin. “This is something that the American people are furious about.”
Bellin’s firm received $900,000 of a $6 million settlement reached this past March with the London-based university over the 2012 faxes. A $2.6 million settlement in a Bais Yaakov class action case against the college guide publisher Peterson’s earned Bellin’s firm over $800,000 in fees.
Bais Yaakov itself has not earned much money from the suits. Between the two settlements reached so far in Bais Yaakov’s cases, the school appears to have received only $15,500.
Bellin is the husband of a prominent rabbi who leads the Conservative movement’s rabbinical arm.
At least one putative beneficiary of the Bais Yaakov suits exhibited unease with the yeshiva’s tactic. A rabbi at a synagogue that was included as a member of the class in one of the settled suits told the Forward that his congregation had chosen not to accept settlement funds. “I don’t think that we were wronged,” said the rabbi, who asked not to be named, in order to protect relationships. “I don’t want to collect money from a lawsuit if I wasn’t wronged.”
Bellin declined to discuss Bais Yaakov, citing attorney-client privilege. He said he would not comment on ongoing cases.
Bais Yaakov’s principal, David Sussman, hung up the phone before a Forward reporter could ask about the lawsuits. “I got to go, sir,” Sussman said.
Spam fax lawsuits are brought under the Telephone Consumer Protection Act, which is a 1991 federal statute, and a 2005 federal law called the Junk Fax Prevention Act. Those laws require faxed advertisements to include instructions on how to opt out of future messages. Recipients of faxes without opt-out language can sue the sender for damages of up to $1,500 per fax. By creating a class that bundles hundreds or even thousands of potential recipients of a fax advertisement campaign, plaintiffs’ attorneys can push the potential damages into astronomically high ranges, effectively forcing defendants to settle before trial.
Suits filed under the TCPA, which also provides damages for spam phone calls and text messages, have exploded in recent years. While just 14 suits were filed nationwide in 2007, nearly 4000 were filed in 2015, according to an analysis by WebRecon.
The explosion in litigation has drawn scrutiny from the Federal Communications Commission, which regulates the industry, and from the courts. In a March decision from the United States Court of Appeals for the Seventh Circuit, Judge Daniel Manion criticized the trend. “In practice, the TCPA is nailing the little guy, while plaintiffs’ attorneys take a big cut,” Manion wrote.
Defense attorneys, too, are critical. The law is being used unfairly, said Justin O. Kay, who ia a partner in the Chicago office of the law firm Drinker Biddle and Reath and specializes in defending TCPA class action suits. “It is being leveraged by the plaintiffs’ bar to attack law-abiding businesses whose actions have caused no real harm to consumers and who often settle these cases just because of the risks involved,” Kay wrote in an email to the Forward. “Those settlements can be massive.”
Bellin and his White Plains, New York, firm, Bellin & Associates, are active members of the TCPA plaintiffs’ bar. Bellin’s wife, Rabbi Julie Schonfeld, has served since 2009 as executive vice president of the Rabbinical Assembly, the membership association for Conservative rabbis.
Bellin’s Bais Yaakov cases have targeted large firms and not small businesses. Yet the alleged and admitted companies that faxed were ones that could have, in theory, had legitimate business with Bais Yaakov or its students. In the case against the educational testing company ACT Inc., which is still ongoing, the school sued the company over faxes reminding students to sign up for the test. In the settled case against the college guide company Peterson’s, Bais Yaakov sued over faxes offering a free online tool for guidance counselors. In an ongoing suit against a firm called Varitronics, Bais Yaakov sued over faxes offering deals on poster printers.
Bais Yaakov has also sued the FCC over an agency policy that would make it harder to sue senders of solicited faxed advertisements that don’t include opt-out language.
Another Bellin client, Brooklyn businessman Menachem Raitport, has filed an ongoing spam fax suit against a firm called Harbour Capital Corp. “You have a home office. And your fax machine just wakes up one day and you have 20 faxes from bogus companies. You like that?” Raitport asked when reached at Crown Kosher Meat Market, his business. “I got fed up,” Raitport said. “That’s why I looked for a lawyer.
Contact Josh Nathan-Kazis at [email protected] or on Twitter, @joshnathankazis.
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