In a blow to millions of consumers who were awaiting the launch of a national Do Not Call list to restrict their mid-dinner calls from telemarketers, a federal judge in Oklahoma ruled Wednesday that the Federal Trade Commission lacks the legal authority to begin the system as planned next Wednesday.
commission responded immediately, filing a motion of its intent to
appeal the decision by U.S. District Judge Lee R. West. The agency
also asked the court to allow it to implement the program with
out delay pending a decision.
"This decision is clearly incorrect," FTC chairman
Timothy J. Muris said in a statement. "We will seek every recourse to
give American consumers a choice to stop unwanted telemarketing
But the ruling was cheered by
representatives for the telemarketing industry, which has filed
several lawsuits contending that the Do Not Call registry infringes
on their First Amendment rights. The industry estimates that the
provision would halve their business, costing $50 billion in annual
Legal experts and lawmakers were surprised at
the ruling, which at least temporarily halted a provision that was
supported by President Bush and, apparently, a wide swath of the
American public. About 50 million people have signed up to place their name on a list
to forbid telemarketers from calling their homes. About three-quarters of the states have begun or plan their own Do Not Call lists,
which would fold into the national registry.
Some predicted the decision would be a temporary setback.
If the courts move
fast enough, legal experts said, the Do Not Call mechanism could
still be implemented next Wednesday, as planned. Some noted the recent
successful appeal that placed the California recall election back on
track for Oct. 7, eight days after a ruling struck it down.
"It doesn't doom it," said Christopher Wolf, a partner with
the Proskauer, Rose law firm in Washington. "It's a substantial
roadblock. This just makes it a difficult last week before the list
were to be implemented."
The plan had bipartisan support in Congress, and lawmakers voiced disappointment with the
decision on an issue that has resonated with voters. House Energy and
Commerce Committee Chairman Billy Tauzin, a Louisiana Republican,
and Rep. John D. Dingell, a Michigan Democrat, issued a joint statement saying they believed the decision would be overruled.
"Contrary to the court's decision, we firmly believe
Congress gave the FTC authority to implement the national Do Not
Call list. We will continue to monitor the situation and will take whatever
legislative action is necessary to ensure consumers can stop
intrusive calls from unwanted telemarketers," they said.
The Direct Marketing Association filed the lawsuit in
Oklahoma along with four other telemarketing companies. In a
statement, the DMA said it sympathized with the millions of callers
who want to stop telephone solicitations, but said it preferred to
"self police" the industry.
"The DMA and its
fellow plaintiffs are grateful that the Federal District Court in
Oklahoma City understood and upheld the industry's belief that
the Federal Trade Commission does not have authority to im
plement and enforce a national do-not-call list," the statement said.
"We're excited about it," said Tim Searcy, executive
director of the American Teleservices Association. "We know it's not
the end of the road, but it's a good step."
FTC predicts that a Do Not Call list would block about 80 percent of
telemarketer calls. Charities, surveys and political pollsters would
Telemarketers, however, have argued that the federal
government cannot and should not pick and choose which interests
have the right to communicate to the public.
"It says it's illegal for commercial speech, but OK for political
speech," Searcy said. "They've created two classes of speech."
A business may also call someone on a "No Call" list if
the person has bought, leased or rented its product in the past 18
months. Telemarketers can call if the person has called or in
quired about something from the company in the past three months.
Phone sales companies would be required by the law to
access the registry every three months and delete the phone numbers
on it from their computer banks. The maximum penalty is a $11,000
fine per call if they call a number on the list. Whether -- or
when -- they ultimately face that restriction is uncertain.
"If I had to predict, if we assume that this ruling
stands in court, I would predict that Congress re-enacts the law,"
said Karl Mann, chairman of the marketing and e-business de
partment at Towson University. "It's too popular. I think it's going
to happen. It's just a matter of time."
From Thursday's Sun
Judge blocks Do Not Call list
FTC lacks legal authority to restrict telemarketers, Okla. federal judge says; Commission expected to appeal; Congress members begin planning amendments to counter judgment
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