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Do Not Call List on Hold
Oklahoma Federal Judge Lee R. West ruled on Tuesday that the FTC overstepped its authority in creating the national list.
Posted Sep 25, 2003
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If you are among the more than 50 million people who have already signed up for the national Do-Not-Call (DNC) registry and were eagerly anticipating dinners and evenings free of telemarketing pitches, you might have to wait. Oklahoma Federal Judge Lee R. West ruled on Tuesday that the FTC overstepped its authority in creating the national list, which bars telemarketers from contacting that database of people who object to receiving telephone solicitations. The ruling came just one week before the registry was to go into effect on October 1 and was the result of a lawsuit brought by telemarketers who challenged the list of people who submitted their telephone numbers and said they do not want to receive business solicitation calls. Congress is expected to overturn the ruling during a vote by both houses taking place this afternoon. The crux of the issue, according to Judge West, is whether or not the FTC had the authority to promulgate such a list. West says it does not, based on the 1994 Telemarketing and Consumer Fraud and Abuse Prevention Act, which gave the FCC, not the FTC, the authority to operate a national database of people who object to receiving telephone solicitations, according to the ruling. The FTC, however, counters by saying that the February 2003 Omnibus Appropriations Act, signed by President Bush, authorizes the FTC to "implement and enforce the do-not-call provisions of the Telemarketing Sales Rule." The suit, filed by U.S. Security, Chartered Benefit Services, Global Contact Services, InfoCision Management, and the Direct Marketing Association (DMA), estimates that the DNC list could cost businesses in the telemarketing industry nearly $50 billion in revenue, or half its annual sales. To comply with the DNC list telemarketers would have to review it every three months, and then be fined up to $11,000 for each violation. Direct-marketing companies employ 2 million people and about 60 million telemarketing calls are made daily, according to industry estimates. House Energy and Commerce Committee Chairman Billy Tauzin (R.-LA) and Representative John Dingell (D.-MI) said in a joint statement that they were confident the ruling would be overturned.
On its Web site the DMA states that it is pleased with the ruling. However, the group acknowledges the wishes of millions of U.S. consumers who have expressed their preferences not to receive telephone-marketing solicitations--as evidenced by the millions of phone numbers registered on the FTC list. According to its Web site, "The DMA continues to support and believe in the efficacy of a national list for consumers to express their preference not to receive telephone solicitations. In fact, The DMA has offered American consumers a free, national no-call system--the Telephone Preference Service--since 1985." The FTC's Internet registry, www.donotcall.gov, received 1,000 visits a second on its first day of operation, June 27, and had collected 750,000 names by the end of that day. For consumers, the ruling means their only line of defense against unwanted telemarketing calls for now is the DNC lists already in place in 42 states.
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