A Monthly Review of Issues Affecting Commercial Telemarketing by Copilevitz & Canter, LLC, Attorneys at Law

April, 2003

FTC
The Federal Trade Commission has reached an agreement with several individuals operating a fundraising business in California banning them from ever acting as professional fundraisers and requiring restitution. The principals are now serving time in federal prison based on this suit.

The FTC has expanded its temporary stay of the abandonment provisions found in the new Telemarketing Sales Rule. The entire abandonment rule, including the provisions of the safe harbor (playing a recording to abandoned calls, letting the phone ring at least 4 times or 15 seconds, and keeping records regarding abandoned calls) has been suspended until October 1, 2003. This voluntary stay came immediately after the judge in a constitutional challenge to the Telemarketing Sales Rule declined to issue an injunction on these provisions. Although these lawsuits continue, you should plan to implement the provisions of the Telemarketing Sales Rule on October 1, in the case of the abandonment provisions. The Caller ID provisions of the TSR are to go into effect in January.

The up-sell and pre-acquired account information restrictions of the new Telemarketing Sales Rule are in effect. You should comply with these restrictions immediately. Generally, these restrictions require additional disclosures and/or taping for certain types of sales calls.

The FTC has also announced that it will impose an annual fee of $29 per area code for access to the national do-not-call list with a maximum annual fee of $7,250. The FTC will allow access to up to five area codes at no charge.

FCC
The Federal Communications Commission has issued a notice of proposed rule making requesting comments on another national do-not-call list. Comments are due with the agency within thirty days of when the notice is published in the Federal Register. If you intend to file comments with the FCC, you should begin preparing the same immediately. The FCC list may be intended to cover the gaps in FTC jurisdiction (and therefore gaps in coverage of the FTC do-not-call list.) Please contact me if you would like further information.

CALIFORNIA
The California Senate is considering a bill which would authorize the state to adopt the national do-not-call list to satisfy state law creating a list which was passed last year. As mentioned above, this is perhaps the best solution to harmonize state and federal requirements in this area..

INDIANA
We have filed our response to the State of Indiana's reply in the challenge to the Indiana do-not-call list. The Indiana Attorney General has requested oral argument. It is likely that the court will hear oral argument on this matter in the near future.

KANSAS
Kansas has filed its first suit under the no-call law against a travel company. Like other states, regulatory action under this law is solely complaint driven. If you receive a complaint under this law, you should address it immediately to forestall more serious action. The state is becoming increasingly aggressive although it is still not at the level of some other states.

MICHIGAN
The Public Service Commission of Michigan has decided to adopt the national do-not-call list to implement the state do-not-call list requirement. Hopefully, other states will follow Michigan's lead as this is the most reasonable solution for both consumers and businesses..

MISSOURI
The State of Missouri continues to actively threaten enforcement of its do-not-call list. Missouri, in some cases, has threatened prosecution against organizations which are clearly exempt from the rule's scope. While you should comply with the list, if applicable, you should also be aware of the exemptions to the list especially if you have been contacted by the state.

NEW JERSEY
A New Jersey seniors' group with more than four million members has lobbied the New Jersey Legislature to reject current do-not-call legislation it is considering. The group argues that the bill does not consider existing relationships.

NEW YORK
The General Assembly is considering a bill which would include political telephone calls within the coverage of the state do-not-call list. Members of an organization calling other members would be exempt from the restriction, but other political campaigns would be required to implement the list.

NEW MEXICO
The State of New Mexico is considering a state do-not-call list but has not yet passed the bill into law.

SOUTH DAKOTA
South Dakota has amended it's telemarketing statute. The law now exempts merchants who operate established businesses at fixed locations only if they make less than 25% of total new sales through unsolicited consumer telephone calls. The law also adds persons setting appointments for insurance companies to the list of exempt types of telephone calls.

South Dakota has passed a law creating a state do-not-call list. The law allows a fee of not more than $500 to be charged to access the list. The list will be administered by the State Public Utilities Commission.

WYOMING
Wyoming has changed its commercial telemarketing curfew and now allows calls only between the hours of 8 a.m. and 8 p.m. This curfew is applicable to calls for the sale of goods or services or gathering information which will be used for the sale of goods or services, only.

The authors make every attempt to provide current, accurate information, but Telemarketing ConnectionS® is not intended to be a substitute for legal counsel, and readers should not use it in lieu of obtaining knowledgeable legal, or other professional, counsel expert in the field of commercial telemarketing law. References in Telemarketing ConnectionS® do not constitute endorsement by Copilevitz & Canter, L.L.C. or Telemarketing ConnectionS®. April 1, 2003, Copilevitz & Canter, L.L.C.