Washington Report 022003

Date Published: 
Original Author: 
Robert M. Fells
Original Publication: 
ICCFA Magazine

Oklahoma Federal Court Upholds State Casket Law Restriction 

by Robert M. Fells, Esq., general counsel
A U.S. district court in Oklahoma held that the state law restricting casket sales solely to licensed funeral directors was constitutional. This decision is a departure from other rulings, most recently by the U.S. Court of Appeals for the Sixth Circuit in Craigmiles v. Giles, which held that such laws are unconstitutional. The Oklahoma decision, Powers v. Harris, held that while the state law may be "unwise" and "paternalistic," the restriction was rationally related to the state's interest in protecting the public and thus constitutional.
Specifically, the judge in Powers stated, "The legislature may determine, without interference from the Due Process Clause [of the U.S. Constitution], that protection of the consumer lies in the creation of a cartel-like scheme for the protection of an industry."
The federal appeals court decision in Craigmiles held that there was no rational basis for the state of Tennessee to impose a similar restriction in its law. While the judge in the Oklahoma decision acknowledged the findings by the appeals court in Tennessee, he criticized the higher court's decision by claiming that it took "a less-than-disciplined approach" in striking down the Tennessee law.
Attorneys for the casket retailers in Oklahoma have said they plan to appeal the lower court's decision to the 10th U.S. Circuit Court of Appeals.

Amended FTC Telemarketing Sales Rule Retains 'Appointment Call' Exemption, Adds 'No Call' List

In mid-December, the Federal Trade Commission published a 272-page report announcing its long-awaited amendments to the Telemarketing Sales Rule (TSR). When the TSR was first enacted in 1995, the ICFA was instrumental in obtaining an exemption for preneed "appointment" calls where nothing is sold over the phone, but where the purpose of the call is to gauge interest in arranging a face-to-face meeting at a convenient time. The FTC added this exemption for face-to-face meetings but later questioned whether it should be retained when the rule was reviewed in 2000.
The ICFA urged retention of the exemption due to the absence of consumer complaints or industry misconduct, but the Funeral Consumers Alliance and the National Funeral Directors Association both urged the FTC to exclude cemeteries and funeral homes from the exemption. The ICFA, represented by Vice President Paul M. Elvig, subsequently testified at an FTC public hearing in Washington, D.C., last summer.
As expected, the FTC announced that it would maintain the face-to-face exemption without excluding cemeteries or funeral homes. However, the FTC added some conditions to the exemption, the most significant being the requirement for callers not to phone consumers who have added their home numbers to a national Do Not Call registry the FTC proposes to launch in the next few months.
The ICFA had objected to this requirement as applied to the face-to-face exemption because preneed callers are already required to maintain a company-specific Do Not Call list under the Telephone Consumer Protection Act enforced by the Federal Communications Commission. The ICFA pointed out that the FTC rule distinguished between calls made for the purpose of selling goods or services by phone and appointment calls where nothing is sold over the phone. The ICFA argued that by requiring preneed callers to comply with the Do Not Call list, the FTC was blurring the distinction between the two types of phone calls. However, as a practical matter, the FTC Rule applies only to interstate, not in-state, calls.
Other conditions the FTC attached to the face-to-face exemption are more practical in nature. Callers are prohibited from using threats, intimidation and profane/obscene language; annoying or harassing individuals by continuous or repeated calling; blocking caller ID; and calling before 8 a.m. or after 9 p.m. local time. Complete details of the TSR requirements can be found at www.ftc.gov.
Telemarketing firms and some of their trade associations have announced their intention to litigate against the FTC over the constitutionality of the Do Not Call list requirement. Prior to implementing the registry, the FTC must first obtain funding authorization from Congress and estimates operating costs at $16 million annually. These costs will eventually be defrayed by telemarketers, who must obtain the lists from the FTC and update them every three months.
ICFA members will be kept informed of important developments. For the most timely news, check the biweekly ICFA WIRELESS e-mail newsletter.