*Talk.com Ordered Not to Ride BellSouth's Coattails

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BellSouth, Atlanta, said yesterday a federal court had ordered Talk.com, a telecommunications provider, to cease claiming affiliation with the baby bell in telemarketing calls to consumers.

The temporary restraining order, issued by the U.S. District Court for the Northern District of Georgia in Atlanta, requires Talk.com, Reston, VA, to add a line to its outbound telemarketing scripts to make it clear that the company is separate and distinct from BellSouth.

The court ordered Talk.com to refrain from claiming that it is a subsidiary of BellSouth, a majority shareholder of BellSouth or a BellSouth service provider. Additionally, the order states that Talk.com cannot tell customers that they can keep their BellSouth local telephone service if they switch to Talk.com.

BellSouth's lawsuit, which is still pending, charges Talk.com with making "false and disparaging" remarks about BellSouth in its telemarketing calls. BellSouth said several of its customers had called complaining about Talk.com's misrepresentations.

Talk.com has no authorization to use BellSouth's name or trademark. BellSouth said it asked Talk.com to stop the misrepresentations, but the activities did not cease.

Talk.com has zero tolerance for telemarketers who make misrepresentations to consumers, said Talk.com President Ken Baritz. Until recently, the company outsourced most of its outbound telemarketing operations.

Talk.com now handles 75 percent of its telemarketing operations inhouse primarily due to economic reasons, Baritz said. In the last 90 days, Talk.com stopped using seven of the nine firms it uses for outbound telemarketing.

Baritz would not reveal which companies were eliminated. When Talk.com was made aware of complaints regarding misrepresentations made by telemarketers, the company took steps to have individual call center agents fired, or stopped doing business with the company responsible for the action, Baritz said. He added that misrepresentations occurred in only a fraction of the calls made by Talk.com telemarketers.

"You're going to have, from time to time, a rogue telemarketer or confused consumer," Baritz said.

Talk.com has 1.5 million long-distance customers and is the exclusive provider of America Online Long Distance service. Since 1997 the company has offered local telephone service, which it now provides to 300,000 customers in BellSouth's territory, which includes Alabama, Florida, Georgia, Kentucky, Louisiana, Mississippi, North Carolina, South Carolina and Tennessee.

Baritz said he found it "intriguing" that BellSouth has "responded in a regulatory fashion and not in a competitive fashion" to Talk.com's growing customer base. He said the company stands ready to defend the allegations in court, but expects the litigation to be settled shortly.

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