In the Florida Supreme Court case of Penzer v. Transportation Insurance Company, the court ruled that the standard General Liability policy form covers lawsuits alleging that fax blasts are in violation of the federal (TCPA).
In this case, a class action lawsuit was filed against Nextel (or its agent) for sending unsolicited fax blasts in violation of the TCPA. The TCPA is a federal law making it unlawful to use a fax, computer or other device to send an unsolicited advertisement to a fax machine. Each fax sent in violation can result actual damages or $500.
Transportation Insurance Company argued that the advertising injury coverage under its General Liability must be for “oral or written publication of material that violates a person’s right of privacy.” And, in the present case, no private content was communicated in the advertisement.
However, the court opined that the “right of seclusion” is a right of privacy that is provided for under the TCPA. Therefore, the “advertising injury” coverage under the General Liability form does provide coverage for sending unsolicited fax advertisements in violation of the TCPA.
In the Penzer case, the fax blast violation occurred in 2003. Since that time, the insurance industry has adopted form CG 00 67 03 05 entitled “Exclusion-Violation of Statutes that Govern E-Mails, Fax, Phone Calls or Other Methods of Sending Material or Information.” This policy endorsement should preclude coverage in the majority of these cases.