- The Washington Times - Monday, October 4, 2004

ASSOCIATED PRESS

The Supreme Court turned away a challenge yesterday to the national do-not-call registry, ending telemarketers’ bid to invoke free-speech arguments to get the popular ban on unwanted phone solicitations thrown out.

The court, without comment, let stand a 10th U.S. Circuit Court of Appeals decision that upheld the registry of more than 57 million phone numbers as a reasonable government attempt to safeguard personal privacy and reduce telemarketing abuse.

Under the 2003 federal law, businesses face fines of up to $11,000 if they call people who sign up for the registry — unless they have recently done business with those people. Charities, pollsters and callers on behalf of politicians, however, are exempt.

Telemarketing groups had filed the appeal, arguing in filings that the registry violated First Amendment rights because it singled out businesses while exempting other groups. They also said 2 million of their 6.5 million workers will lose their jobs within two years if the do-not-call rules stand.

A federal judge in Denver agreed with the telemarketers, but the circuit court upheld the registry in February 2004 after finding no evidence suggesting that charitable or political callers were as intrusive to consumers’ privacy.

Also as of yesterday, MasterCard International Inc. and Visa USA Inc. no longer can block banks from issuing credit cards from competitors after the Supreme Court declined to hear their appeal.

Banks that issued MasterCard and Visa credit cards had been barred from also offering credit cards from other companies, such as Discover Financial Services Inc. and American Express Co.

The Bush administration argued in court filings that removing the restriction would encourage competition and lead to more choices and, possibly, lower interest rates for consumers.

The administration had won in district court and in the New York-based 2nd U.S. Circuit Court of Appeals, which found the restriction was anti-competitive.

About 20,000 banks issue cards only through Visa and MasterCard.

American Express has been trying to persuade banks to issue its cards. Under the contested rules, banks would have to give up Visa and MasterCard credit cards to do that, and no U.S. bank has agreed, the court was told.

American Express and Discover have been issuing cards directly to individuals, although some foreign banks issue American Express cards.

After the court’s announcement, MBNA Corp. said that it would begin issuing American Express credit cards.

“Today’s news marks a fundamental change in the U.S. credit-card industry, and we believe it will lead to better value and greater choice for consumers,” said Ken Chenault, chairman and CEO of American Express.

Roy Englert, one of the attorneys for MasterCard, wrote in a Supreme Court filing that consumers have been given better quality, prices and choices with the regulations in place.

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