News briefs/directmag.com

9/25

A SECOND FEDERAL JUDGE weighed in against the Federal Trade Commission's do-not-call registry, saying it violates free-speech protections. U.S. District Judge Edward W. Nottingham of Denver blocked the list, which sources said will result in a continued court battle. Meanwhile, the U.S. Senate and House of Representatives voted to reinstate the list and sent the bill to President Bush for his signature. In a related development, a flash survey by Insight Express found that over half of all U.S. consumers are angry over the first court decision to block the list. Of those who have registered, 73% were angered by the decision, 78% see no reason to delay implementation and 66% view the list as “essential to their tranquility.” The survey also found that the nuisance factor isn't the only reason 50 million Americans have signed up for the registry. Among the do-not-call registrants, 88% said that telemarketing doesn't provide the products they want, and 67% don't view telemarketers as honest and trustworthy.

9/24

U.S. JUDGE LEE R. WEST threw out the Federal Trade Commission's do-not-call registry on the grounds that the FTC lacks authority to operate such a list. West wrote that power to regulate must “always be grounded in a valid grant of authority from Congress.” On file with the U.S. District Court for the Western District of Oklahoma, the ruling was in response to a suit filed by the Direct Marketing Association and several companies challenging the agency. FTC Chairman Timothy J. Muris denounced the ruling as “incorrect. We will seek every recourse to give American consumers a chance to stop unwanted telemarketing calls.”

REDENVELOPE, a cataloger and Internet retailer, announced an initial public offering. The company is making available 2.2 million shares of its common stock at a proposed price of $14 per share. Founded in 1997, the firm reported a $7.7 million net loss for the fiscal year that ended March 30. However, that loss was almost half the one reported for the prior year. In its prospectus, the company reported net revenue of $70 million for the year ending in March, compared with $55.7 million for the year earlier.

9/23

THE ELECTRONIC PRIVACY INFORMATION CENTER (EPIC) filed a complaint with the Federal Trade Commission against Acxiom Corp. and JetBlue Airways Corp., alleging that both firms engaged in deceptive practices when they provided consumer data to a U.S. Defense Department contractor. According to the complaint, JetBlue supplied itinerary information on more than 1.5 million passengers to Torch Concepts, a firm that had developed pattern-recognition technology for the DOD. Torch Concepts bought overlay information from Acxiom on 40% of the individuals in this file, and Torch Concepts used it to generate a presentation for the Tennessee Valley Chapter of the National Defense Industries Association. This, the complaint said, was in violation of both firms' privacy policies. Acxiom representatives denied the charges, saying the firm “acted in a manner that complied with applicable laws and with our published policy.” Meanwhile, JetBlue was hit with a class-action lawsuit. The airline has said that it shared passenger itineraries at the request of the Defense Department and that it did not receive any payment for the information.

IAC/INTERACTIVE CORP. said it will acquire Hotwire.com, a discount travel Web site, for $665 million in cash and assumption of $20 million in options and warrants. Hotwire will remain a separate brand within IAC after the purchase.

9/22

MASSACHUSETTS STATE LEGISLATORS scheduled a hearing on a bill calling for the establishment of a do-not-mail list. The bill, authored by State Rep. Susan Pope (R-Wayland), would allow consumers to add their names to the list by checking a box on their annual tax returns. The do-not-mail list would apply to unsolicited mailings to generate new customers or new donors for a charity. Mailers would be required to send postcards to customers they have not heard from in two years. If the card is not sent back requesting mailings, the marketer would have to stop mailing. Violators could face penalties of up to $5,000.

9/19

THE J. JILL GROUP INC. said it expects to report a third quarter loss of about 15 cents per share, compared with income of 18 cents per share last year. The cataloger/retailer's net sales are expected to fall in the range of $80 million to $83 million, flat as compared with last year's results.

THE BRITISH GOVERNMENT said it passed a law requiring spammers to get permission beforehand from their recipients. Violators will be subject to fines of 5,000 British pounds sterling (about $8,000) and may be subject to additional lawsuits. The rule, aimed at shrinking the heavy traffic of unsolicited e-mail messages, also applies to unsolicited text messages sent to mobile phones. But the government won't be able to touch bulk e-mailers who target Britons from outside the country.

9/18

WESLEY CLARK, the former Army general who announced his candidacy for the Democratic presidential nomination on Sept. 17, has terminated his $150,000-a-year consulting agreement with Acxiom Corp. but will remain on its board of directors, according to an Acxiom spokesperson. Clark, an Arkansas native, joined Acxiom in 2001 and played a part in the company's efforts to market its services to federal organizations involved in homeland security.

9/17

THE HOUSE OF REPRESENTATIVES passed H.R. 49 by a voice vote, making the Internet Access Tax Moratorium permanent. The bill also would roll back access taxes in nine states. The Direct Marketing Association praised the quick passage, and urged the Senate to follow suit. “The relatively easy passage of H.R. 49 today by the House reflects a widespread and bipartisan belief that the Internet is an important and growing channel for communications, education and commerce, both here at home and around the globe, said Jerry Cerasale, the DMA's senior vice president for government affairs, in a statement.

9/16

SEN. RICHARD SHELBY announced he had drafted a bill that would prevent federal provisions on collecting and using consumer data to be pre-empted by state laws. But the bill does not preclude setting federal standards that are as stringent as those enacted by the states, if not more so, sources said. The House of Representatives passed a similar bill extending the prohibitions on Sept. 10.