Two Oct. 5 headlines incorrectly characterized the U.S. Supreme Court's action on a case involving the federal do-not-call registry. The court declined to hear an appeal of a lower court's ruling that affirmed the list's constitutionality. (Published 10/6/04)
The national do-not-call list overcame its last legal hurdle yesterday when the Supreme Court let stand a lower-court ruling affirming its constitutionality.
Without comment, the justices rejected an appeal by telemarketers who argued that the popular anti-telemarketing registry imposed improper limits on their rights to free speech.
In the year since it took effect, more than 64 million telephone numbers have been posted to the list, according to the Federal Trade Commission, which is in charge of enforcing the list. Telemarketers risk a fine of up to $11,000 for each number they call on the list.
More than 500,000 complaints have been filed with the FTC against more than 130,000 companies, including 200 with more than 100 complaints each.
Despite the complaints, surveys show that consumers think the list works. In one study last summer by the Customer Care Alliance, a consortium of customer relations firms, 87 percent of those registered said they received fewer phone calls, six instead of about 30 a month.
So far, the FTC and the Federal Communications Commission, which also polices the list, have brought only a handful of enforcement actions against telemarketers. The FTC filed suit against a credit repair firm that was allegedly masquerading as a nonprofit debt negotiation firm to get around the government's do-not-call rules. It also is seeking civil penalties against a telemarketing firm for calling more than 300,000 numbers to sell time-share properties in Atlantic City.
In an FCC settlement, the McLean phone service provider Primus Telecommunications Group Inc. agreed to pay $400,000 to settle allegations that it placed prohibited calls.
The appeal to the Supreme Court was sought by the American Teleservices Association, which represents about 650 centers that make sales calls, usually for other businesses.
In February, three judges in a Denver appeals court unanimously ruled that the do-not-call list was a valid restraint of commercial speech because it "targets speech that invades the privacy of the home, a personal sanctuary that enjoys a unique status in our constitutional jurisprudence."
The appeals court decision overturned an earlier ruling by a federal judge who found the list unconstitutional because it barred commercial solicitations while allowing calls from politicians and charities. The appeals court said such a distinction was merited because the government had found that commercial callers are more likely to engage in prospective and abusive practices.
ATA Executive Director Tim Searcy said his group was disappointed by the ruling. "Many companies have folded and jobs have been lost," he said. But he said his group will continue to work to iron out inconsistencies in state and federal telemarketing rules.
The larger Direct Marketing Association declined to appeal, saying its members didn't want to risk bad publicity.