An Internal Affairs spokesman declined to comment further until the legal process was completed.
But Encore Cabaret director Ondrej Havas said the investigator from the Electronic Messaging Compliance Unit told him the government agency investigating the fax was also the sole complainant.
"There was only one complaint and it was the DIA who had received an invitation to have a staff party at our place."
Mr Havas admitted it was an old-fashioned way of communicating but one of the directors had previously had success with it. He did not think it was right when the only injured party was the enforcing agency.
"If I show you the original fax - it's just so ridiculous that so much energy has gone into something so harmless and so small."
Mr Havas claimed a team from Internal Affairs was flown from Wellington to Auckland to investigate the matter and said it was a complete waste of taxpayer's money.
"One needs to find common sense."
Encore wrote to Internal Affairs objecting to the fine because it had previously used the same mailing list before the new act and had no complaints so had taken that as having permission. The objection was dismissed and the company had until June 15 to appeal to the district court.