Comment Flood Backs State Telemarketing Laws Over National DNC

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The score is: Consumers 8,100, Industry 0.


Thousands of comments about a proposal to override restrictive state laws on interstate telemarketing have poured into the Federal Communications Commission, and the tide has run decidedly against the idea.


On June 29, the FCC began accepting comments about a petition -- filed by the Direct Marketing Association, American Teleservices Association and numerous other groups and companies -- urging the agency to exert its jurisdiction over interstate telemarketing. Petitioners say several state laws are more restrictive than federal law, particularly on the issue of existing business relationship exemptions, and that the myriad state laws make compliance confusing and expensive.


As of July 21, more than 8,100 people had e-mailed comments to the FCC. Randomly sampling the comments shows that they run along the lines of the statement from Mary McCoy of Indianapolis, who said, "I am writing to ask that no changes be made to Indiana's No-Call list that would weaken it in any way."


ATA and DMA officials said they aren't too worried by the comments and that they expect the law, which they think is on their side, to prevail. Telemarketing calls that cross state lines are covered by the Constitution's commerce clause, which clearly gives authority over interstate commerce to the federal government, they said.


"It's a matter of law," ATA CEO Tim Searcy said. "We're relying on the fact that the case law is very clear, that interstate commerce must be regulated on the federal level."


The ATA and DMA plan to file comments before the July 29 deadline. Searcy said he has heard that several ATA members are preparing comments and that some are encouraging their employees to file as well.


A majority of the comments have come from Indiana, which is the source of more than 7,300 submissions. New Jersey and Wisconsin have contributed more than 350 each. Officials in all three states have sponsored online drives to get residents to submit comments in favor of state telemarketing laws. However, none has been more successful than Indiana Attorney General Steve Carter, a vociferous supporter of state no-call laws.


Carter has a page at www.savedonotcall.com that links to the FCC comment Web site and urges consumers to call members of the Consumer Bankers Association, which supports federal jurisdiction over interstate telemarketing. He said he is not surprised at the volume and nature of the comments submitted so far.


"They have a lot to lose if the law would be preempted," Carter said. "When people hear about a program that's worked well for years being taken away or being diluted to the point where it's not nearly as meaningful, they're going to be concerned."


Carter persuaded one group that originally joined the ATA and DMA on the petition, the National Multiple Sclerosis Society, to withdraw. Thirty-two organizations remain on the petition.


"Perception and reality have to be addressed when you're running a nonprofit," Searcy said. "I understand."


For its part, the FCC is caught between political pressure exerted by the state attorneys general and the prospect of ceding its authority over an interstate communications issue. It's a familiar position for the FCC, said Jerry Cerasale, DMA senior vice president of government affairs.


"Federal regulatory agencies are always stuck between sides," he said. "It's a political entity. There's always going to be political pressure."


Cerasale and Searcy think warnings issued by state officials about a "flood" of telemarketing calls to follow the success of their petition are unfounded. They point out that states still will be able to regulate intrastate telemarketing calls -- those placed and received in one state. They also note that several states, including California and New York, follow federal no-call guidelines and have experienced no problems.


Whatever the FCC decides, the issue eventually may go to the courts, a fight telemarketers may have trouble funding after their failed, multimillion-dollar court challenge to the national no-call list. Carter said he would examine all options if the FCC sides with telemarketers.


"Right now, we're going to focus on this effort," he said. "Hopefully, the FCC will issue a ruling that doesn't take away privacy standards that citizens have enjoyed for years."


Scott Hovanyetz covers telemarketing, production and printing and direct response TV marketing for DM News and DMNews.com. To keep up with the latest developments in these areas, subscribe to our daily and weekly e-mail newsletters by visiting www.dmnews.com/newsletters


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