DELANGE.docx

June 27, 1996
Brett DeLange
Deputy Attorney General
Consumer Protection Unit
Office of the Attorney General
PO Box 83720
Boise, ID 83720-0010
Re:  Preexisting Agreements for Pay-Per-Call Services
Dear Brett,
Pursuant to our previous conversation this Tuesday, I have enclosed for your review various materials concerning the regulation of pay-per-call services.  I have copied portions of the Telephone Disclosure and Dispute Resolution Act of 1992 (TDDRA) and the most recent FCC rules dealing with interstate pay-per-call and 800 services (47 C.F.R. §§ 64.1501 et seq.).  Title 1 of TDDRA amends Section 228 of the Communications Act of 1934 (codified at 47 U.S.C. § 228).  Portions of the Telecommunications Act of 1996 which recently amended Title 1 of TDDRA are also included.
As confirmed in our conference call with the FCC attorney, telecommunications carriers routinely remove disputed pay-per-call charges from customer’s telephone bills.  In addition, § 228(c)(3) prohibits a communications carrier from disconnecting a customer’s local exchange or long-distance services “because of nonpayment of charges for any pay-per-call service.”  This section further provides that
(2) CONSUMER PROTECTION LAWS. – Nothing in this section shall relieve any provider of pay-per-call services, common carrier, local exchange carrier, or any other person from the obligation to comply with any Federal, State, or local statute or regulation relating to consumer protection or unfair trade.
. . .
(4) STATE AUTHORITY. – Nothing in this section shall preclude any State from enacting and enforcing additional and complimentary oversight and regulatory systems or procedures, or both, so long as such systems and procedures govern intrastate services and do not significantly impede the enforcement of this section or other Federal statutes.
47 U.S.C. § 228(g)(2) and (4) (emphasis added).  Note that a state’s authority in subsection (4) above only applies to intrastate services.
TDDRA Section 302 (relating to the duties and responsibilities of the FTC) provides that persons subject to the Act must comply with State laws “except to the extent that those laws are inconsistent with any provision of this Title.”  However, this section also declares that state laws giving greater protection to consumers are not to be considered inconsistent with the Act.
Several provisions of the TDDRA reference a “preexisting agreement” with the service provider.  See Section 228(c)(6)(C) and Section 304(1)(A).  The FCC rules at 47 C.F.R. § 64.1501 defines “presubscription or comparable arrangement.”  Subsection (5) contains the credit card billing arrangement that we spoke of earlier.  In particular, subsection (5) provides that disclosure of a credit or charge card number coupled with authorization to bill that credit card “shall constitute a presubscription or comparable arrangement if the credit . . . card is subject to dispute resolution procedures in the Truth in Lending Act and Fair Credit Billing Act.”  In addition, you’ll note that Section 701 of the Telecommunications Act of 1996 amends Title 1 of the TDDRA by requiring a “written agreement” if a service provider is going to charge customers for making what would otherwise be a toll-free call.    The FCC is to revise its regulations implementing the amendments to TDDRA no later than August 8, 1996 See Section 701(2).  I have not reviewed any FCC Orders that might discuss “presubscription agreements.”
Finally, I have enclosed Section 502(2) of the Telecommunications Act.  You might review the text of this section to determine if there is a description you could utilize for “sexually explicit adult pay-per-call service.”  For example,
Any, suggestion, proposal, image, or other communication that, in context, depicts or describes, in terms patently offensive as measured by contemporary communities standards, sexual or excretory activities or organs, . . .
Call me if you have further questions.  
Sincerely,
Donald L. Howell II
Deputy Attorney General
Enclosures
cc:Jack McMahon
Bev Barker
bls/L-delange.dh