|No one wants to ban passing them out. It's just they want to ban passing out advertising without consent.
This may be the one sticking point they have around it. However, I wonder how this is any different than junk mail? Junk mail just pays the Post Office, how is that better/worse than paying an employee to pass out the flyer/phonebook/etc?
I think this is an interesting case and I'm looking forward to the outcome.