Dandelions and Liability

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NEW YORK -- One thing that all list managers and brokers have in common is the ever-looming issue of compliance.

That is exactly what Andrew B. Lustigman focused on at Avrick Direct's "Legal Issues That Affect List Brokers" conference at the New Yorker Hotel.

The issue of supplier liability lies on the standard of knowing, and making sure to know, Mr. Lustigman said.

"The standard is you know or you should have known," he said. "Willful blindness" is not tolerated.

Much of it involves clients being located internationally, making it hard to get people outside the border, he said, and so those within the border are being scrutinized.

This is based on the dandelion effect. When a dandelion is ripped out by the roots, it dies -- and supervisors are trying to get to the root of the problem.

"Brokers and managers have the obligation to determine whether their vendors are in compliance," Mr. Lustigman said.

Mr. Lustigman outlined what brokers and managers should do. First and foremost, they should get to know their clients and their businesses. Also, they must independently verify their clients' marketing program, ensuring that their fulfillment matches the marketing script.

In addition, substantiation from outside lawyers through a legal opinion letter could be helpful. These individuals also need to read their clients' privacy policy and ensure that it conforms to the data, he said.

Not complying, by acting irresponsibly or by willful blindness, could bring civil and criminal charges against brokers and managers -- the roots of the dandelion.

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