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Judge Bars 'Do-Not-Call' Telemarketing List

The federal jurist says the FTC does not have the authority to enforce the registry. Lawmakers vow to pass legislation to counter the ruling.

September 25, 2003|Edmund Sanders | Times Staff Writer

WASHINGTON — In a surprise ruling that congressional leaders vowed to overturn, a federal court in Oklahoma has invalidated a "do-not-call" telemarketing registry that was set to take effect next week.

U.S. District Court Judge Lee R. West ruled that the Federal Trade Commission, which created the list this summer to help people block unwanted phone solicitations, did not have sufficient authorization from Congress to proceed.

More than 50 million people signed up for the list. Given that popularity, lawmakers vowed after Tuesday's ruling that the registry would be implemented by next Wednesday as planned.

"Fifty million Americans can't be wrong," said Rep. John D. Dingell (D-Mich.).

Dingell, Rep. W.J. "Billy" Tauzin (R-La.) and other lawmakers rejected the court's finding that Congress had not authorized the do-not-call list. But they said they would quickly craft more explicit language and attempt to insert it into a must-pass spending bill that could come before Congress as early as today.

"It is now incumbent upon us to cure this," Tauzin said Wednesday. "We are determined before we leave this session of Congress to make sure [the American people] have the advantage of a do-not-call list."

Sen. Dianne Feinstein (D-Calif.) said she would introduce similar legislation in the Senate. An estimated 6 million Californians were among those who signed up. Gov. Gray Davis said California would press ahead with its own do-not-call registry -- approved by state lawmakers two years ago -- regardless of the outcome of the federal effort.

Attorneys for the FTC also plan to appeal the 19-page ruling, which was issued Tuesday but not widely circulated until Wednesday.

"This decision is clearly incorrect," FTC Chairman Timothy J. Muris said. "We will seek every recourse to give American consumers a choice to stop unwanted telemarketing calls."

Telemarketers, including the Direct Marketing Assn., U.S. Security, Chartered Benefit Services and Global Contact Services, this year sued to block the do-not-call list, which they claimed violated their constitutional free-speech rights.

"The Direct Marketing Assn. and its fellow plaintiffs are grateful that the federal district court in Oklahoma City understood and upheld industry's belief that the Federal Trade Commission does not have authority to implement and enforce a national do-not-call list," the trade group said.

Even so, telemarketers conceded that the victory may be short-lived and promised to work with government officials to accommodate "the wishes of millions of U.S. consumers."

Under the FTC rules, telemarketers that violate the do-not-call list can be fined as much as $11,000 per call.

In his ruling, West said the Federal Communications Commission, and not the FTC, is the agency charged by Congress to implement a do-not-call list. The FCC also is working to create such a list but is moving more slowly than the FTC.

Brushing aside legislation approved this spring, including the Do-Not-Call Implementation Act and an appropriations bill funding the FTC program, the judge found that the FTC overstepped its authority.

An "administrative agency's power to regulate in the public interest must always be grounded in a valid grant of authority from Congress," West said. "Absent such a grant of authority in this case, the court finds the do-not-call provision to be invalid."

West did not issue a stay or injunction to block the list from taking effect, but the ruling left the program's legality in limbo.

Tauzin expressed surprise at the court ruling, noting that during committee hearings lawmakers specifically expressed their intent to authorize and fund the FTC program.

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