DMA Disappointed by North Dakota Supreme Court Decision on Telemarketing Case

WASHINGTON, April 24, 2006 – The Direct Marketing Association is disappointed in last week’s ruling by the North Dakota Supreme Court, which upheld a state law prohibiting political calls made using automatic dialing systems with prerecorded messages. Members of the Court rejected an argument that the Telephone Consumer Protection Act of 1991 (TCPA) preempts North Dakota's own rules, as it applies to interstate calls.

Jerry Cerasale, DMA’s Senior Vice President for Government Affairs, notes that the decision seems inconsistent with a February 2006 ruling by the federal district court in California, which held that a California fax-ban law as it applied to interstate faxes was preempted by federal telemarketing and fax laws.

DMA supports federal preemption for the Do Not Call List and other regulations governing telephone and fax marketing. Two years ago, DMA formally petitioned the FCC to use its preemptive power to regulate interstate telephone and fax marketing.

DMA firmly believes that the authority to regulate interstate telemarketing lies with the federal government. The Communications Act of 1934, the Telephone Consumer Protection Act of 1991 and the Junk Fax Prevention Act of 2005 all confer upon the Federal Communications Commission exclusive jurisdiction over interstate telemarketing.

TCPA prohibits residential calls using artificial or prerecorded voice system without the recipient’s prior consent. Exemptions are allowed under TCPA for calls that are initiated for emergency purposes or calls that are not made for a commercial purpose.

DMA is currently reviewing the North Dakota ruling and will continue meeting with FCC officials, to request that the agency rule on DMA's petition.

"TCPA set out a clear national standard that businesses and nonprofits are complying with. Because legitimate telemarketing routinely works across state lines, we need this single set of rules, as opposed to an impractical and unworkable patchwork or state regulations,” said Cerasale.

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About the DMA

The Direct Marketing Association (www.the-dma.org) is the leading global trade association of business and nonprofit organizations using and supporting multichannel direct marketing tools and techniques. DMA advocates industry standards for responsible marketing, promotes relevance as the key to reaching consumers with desirable offers, and provides cutting-edge research, education, and networking opportunities to improve results throughout the entire direct marketing process. Founded in 1917, DMA today has more than 4,800 corporate, affiliate, and chapter members from the US and 46 other nations, including 55 companies listed on the Fortune 100.

In 2005, companies spent an estimated $161 billion on direct marketing in the United States. Measured against total US sales, these advertising expenditures generated an estimated $1.85 trillion in increased sales in 2005, or 7% of the $26 trillion in total sales in the US economy (which includes intermediate sales). All together, direct marketing accounted for 10.3% of total US GDP in 2005.

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