# Opposition Brief — National Federation of the Blind v. Federal Trade Commission (No. 05-927)

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URL: https://www.frixlaw.com/law-library/documents/brief%3Amicro_IA40386016_0742%3A2

## Record

- **Collection:** Supreme Court brief
- **Document type:** Opposition Brief
- **Published:** January 1, 2005

## Text

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behalf of the particular seller or non-profit organi-
zation;

(2) the prohibition on abandoned (and recorded) calls,
16 C.F.R. 310.4(b)(1 (iv), which requires the tele-
marketer to connect each call to a representative
within two seconds of the recipient’s completed
greeting:

(3) the prohibition on placing calls before 8 a.m. or
after 9 p.m., 16 C.F.R. 310.4(¢);

(4) the requirement that telemarketers transmit
caller identification information, 16 C.F.R.
310.4(a)(7); and

(5) a requirement that telefunders promptly indicate
that the purpose of the call is to solicit charitable
contributions and identify the charity on behalf of
whom they are soliciting, 16 C.F.R. 310.4(e).

b. The Commission’s authority under the Tele-
marketing Act overlaps with authority provided to the
Federal Communications Commission (F'CC) under the
Telephone Consumer Protection Act of 1991 (TCPA), 47
U.S.C. 227. Among other things, the TCPA directs the
FCC to issue rules addressing “the need to protect resi-
dential telephone subscribers’ privacy rights to avoid
receiving telephone solicitations to which they object,”
47 U.S.C. 227(c)(1), and also prohibits most prerecorded
calls to residential phone lines with a few exceptions, 47
U.S.C. 227(b)(1)B). The definition of “telephone solici-
tation” under the TCPA specifically exempts calls “by a
tax exempt nonprofit organization.” 47 U.S.C. 227(a)(3).

In July 2003, the FCC issued revised TCPA rules that
are nearly identical to the Commission's TSR, including
the “do-not-call” requirements, the abandoned call pro-
visions, the time restrictions, and the disclosure and

6

caller identification provisions. See Jn re Rules and
Regulations Implementing the TCPA (In re TCPA), 18
F.C.C.R. 14,014 (2003). The FCC’s amended rule sub-
jects all commercial entities to its requirements, includ-
ing for-profit entities exempt from the FTC’s jurisdic-
tion. Jn re TCPA, 18 F.C.C.R. 18,558, 18,560 (2003).
The FCC retained regulatory provisions, however, that
exempt from coverage solicitations by both non-profit
organizations themselves and their for-profit
telefunders. 68 Fed. Reg. at 44,161.

2. Petitioners National Federation of the Blind and
Special Olympics Maryland, Inc., are both tax-exempt
non-profit organizations that hire telefunders to solicit
charitable contributions for them. Pet. App. 49a. In
April 2003, petitioners filed suit for declaratory and in-
junctive relief against the FTC in the United States Dis-
trict Court for the District of Maryland. As relevant
here, petitioners contended that the five provisions of
the amended TSR described above, pp. 4-5, supra, vio-
late the First Amendment to the Constitution. Pet. App.
8a, 49a.

The district court granted the Commission’s motion
for summary judgment. Pet. App. 43a-70a. The court
held, inter alia, that the modest restrictions imposed by
the TSR comport fully with the First Amendment. /d.
at 55a-68a.

The court of appeals affirmed the district court’s
judgment. Pet. App. 2a-42a. The court held that the
TSR does not violate the First Amendment because it is
a “reasonable regulation” that is “narrowly drawn” to
serve “sufficiently strong subordinating interest(s] that
the [government] is entitled to protect”—namely pre-
venting fraud and protecting home privacy. Pet. App. 3a
(quoting Secretary of State v. Joseph H. Munson Co.,
467 U.S. 947, 960-961 (1984)). Analyzing each of the

7

challenged TSR provisions in turn (Pet. App. 15a-23a),
the court concluded that they are the “most reasonable
and minor restrictions on telemarketing practices.” /d.
at 20a. For example, the court held that the charity-
specific do-not-call provision is narrowly tailored be-
cause “it restricts only calls that are targeted at unwill-
ing recipients,” and it requires recipients to object to
calls on a charity-by-charity basis. /d. at 17a-18a (quot-
ing Mainstream Mktg. Servs., Inc. v. FTC, 358 F.3d
1228, 1242 (10th Cir.), cert. denied, 543 U.S. 812 (2004)).
The court distinguished the present case from this
Court’s decisions in Munson, supra, Village of Schaum-
burg v. Citizens for a Better Environment, 444 U.S. 620
(1980), and Riley v. National Federation of the Blind of
North Carolina, Inc., 487 U.S. 781 (1986), which held
unconstitutional “blunt and broad” state laws that lim-
ited fundraising fees. Pet. App. 20a. The court of ap-
peals explained that the laws invalidated in those cases
were insufficiently tailored to prevent fraud, whereas
the challenged TSR provisions “are carefully crafted” to
prevent fraud and to protect privacy. /d. at 21a.

The court of appeals also rejected petitioners’ argu-
ment that the TSR is unconstitutionally under-inclusive
because it covers calls by telefunders but not direct
solicitations by charities themselves. Pet. App. 23a-30a.
The court concluded that the purported under-inclusive-
ness in the TSR “is justified by a neutral and legitimate
reason”—the Commission’s jurisdictional limitations.
Id. at 24a; see id. at 26a-29a. The court reasoned that
those jurisdictional boundaries do not raise any “red
flag|s] indicating First Amendment problems,” such as
an attempt to favor one side of a public debate, the
pursuit of an illegitimate government interest, or the
failure genuinely to serve the interest that the
challenged regulation is designed to advance. /d. at 28a.

8

The court noted that the “TSR provisions do not exhibit
any disapproval of the content of the calls placed by
telefunders. The TSR applies evenhandedly to
solicitations for charities of all persuasions and beliefs.
The restrictions apply to all telemarketing calls made by
entities within the FTC’s jurisdiction, regardless of the
subject matter of the call or the viewpoint expressed by
the caller.” /d. at 32a. The court therefore concluded
that the Rule is consistent with the First Amendment.
Id. at 38a.

Judge Duncan dissented. Pet. App 34a-42a. Relying ~
on Riley, supra, and City of Cincinnati v. Discovery
Network, Inc., 507 U.S. 410 (1993), she reasoned that the
TSR is unconstitutionally under-inclusive because it cov-
ers telefunders but not in-house charity callers. Pet.
App. 34a-37a. Unpersuaded that there is a legitimate
justification for that distinction, she concluded that the
Rule violates the First Amendment. /d. at 37a-42a.

ARGUMENT

The decision of the court of appeals is correct, and it
does not conflict with any decision of this Court or of
another court of appeals. This Court’s review is there-
fore not warranted.

1. Although professional fundraising on behalf of
charities enjoys some First Amendment protection, this
Court has consistently held that speech “{s]oliciting fi-
nancial support is undoubtedly subject to reasonable
regulation.” Village of Schaumburg v. Citizens for a
Better Env't, 444 U.S. 620, 632 (1980); see Riley v. Na-
tional Fed ‘xn of the Blind of N.C., Inc., 487 U.S. 781, 795-
796 (1988); Secretary of State v. Joseph H. Munson Co.,
467 U.S. 947, 959-960 (1984). The government may im-
pose content-neutral regulations on charitable fundrais-
ing if the regulations serve “sufficiently strong, subordi-

]

nating interest|s] that the [government] is entitled to
protect” and are “narrowly drawn * * * toserve [the]
interes|ts] without unnecessarily interfering with First
Amendment freedoms.” Munson, 467 U.S. at 960-961
(quoting Schaumburg, 444 U.S. at 636-637). The TSR
provisions challenged by petitioners easily pass that
test.

Petitioners incorrectly assert (Pet. 16-18) that the
TSR’s restrictions are “substantial burdens” on speech.
On the contrary, as the court of appeals explained, the
Rule’s provisions are narrowly tailored to further impor-
tant governmental interests. Pet. App. 15a-23a. Most of
the challenged provisions impose modest limitations on
telemarketing calls in order to protect residential pri-
vacy, which this Court has recognized as an interest “of
the highest order in a free and civilized society.” Frisby
v. Schultz, 487 U.S. 474, 484 (1988) (quoting Carey v.

' Petitioners incorrectly contend (Pet. 10) that the TSR is not
content-neutral. In general, a regulation is content-neutral unless “the
government has adopted [the] regulation because of disagreement with
the message it conveys.” Ward v. Rock Against Racism, 491 U.S. 781,
791 (1989). The TSR was clearly not adopted for such a purpose. As
the court of appeals explained, “the TSR provisions do not exhibit any
disapproval of the content ef the calls placed by telefunders. The TSR
applies evenhandedly te «ticitations for charities of all persuasions and
beliefs. The restrictio@s apply to all telemarketing calls made by
entities within the FTC's jwriadiction, regardless of the subject matter
of the call or the viewpoint expressed by the caller.” Pet. App. 32a.
Petitioners appear to argue that the TSR is not content-neutral based
on the supposition that its restrictions are more likely to affect small or
unpopular charities. Pet. 10-11. Petitioners provide no support for that
supposition, but it is irrelevant in any event. As explained above, the
TSR “serves purposes unrelated to the content of expression”—the
protection of privacy and the prevention of fraud—and it is therefore
“deemed neutral, even if it has an incidental effect on some speakers or
messages but not others.” Ward, 491 U.S. at 791.

10

Brown, 447 U.S. 455, 471 (1980)). For example, the pro-
hibition on calls early in the morning or late at night
enables families to enjoy a few uninterrupted hours at
home but still permits a generous thirteen hours each
day for solicitations. 16 C.F.R. 310.4(c). Similarly, the
restriction on abandoned calls, 16 C.F.R. 310.4(b)(1)(iv),
protects households from an intrusion that the Commis-
sion found, based on extensive public comment, to be
particularly severe. Abandoned calls not only waste con-
sumers’ time but also frighten some consumers, who
become concerned that they are being monitored by
stalkers or burglars. 68 Fed. Reg. at 4641-4643.

Other provisions of the TSR simply give individual
households the choice to restrict unwelcome solicita-
tions. The entity-specific do-not-call provision enables
consumers to indicate that they do not wish to receive
additional calls on behalf of a particular charity. 16
C.F.R. 310.4(b)(1)(iii( A). Similarly, the provision re-
quiring telemarketers to transmit their caller identifica-
tion information gives households the opportunity to
screen solicitation calls and either accept or ignore the
calls as they see fit. 16 C.F.R. 310.4(a)(7); see 68 Fed.
Reg. at 4627. The Court has repeatedly approved regu-
lations of this type, which allow individuals to opt in to
limitations on speech, because they are a far more nar-
rowly tailored means of protecting privacy than absolute
prohibitions on speech. See Rowan v. United States
Post Office Dep't, 397 U.S. 728, 737-738 (1970) (uphold-
ing law permitting residents to bar mailings that they
consider to be provocative); Watchtower Bible & Tract
Soc’y of N.Y., Ine. v. Village of Stratton, 536 U.S. 150,
168-169 (2002) (recognizing validity of law permitting
enforcement of “no solicitation” signs posted by resi-
dents); United States v. Playboy Entm’t Group, Inc.,

11

529 U.S. 803, 815 (2000) (targeted blocking by consumer
less restrictive than government ban on speech).

The fifth provision challenged by petitioners requires
telefunders to identify the charity on whose behalf they
are calling and the purpose of the call. 16 C.F.R.
310.4(e). As the court of appeals explained, that provi-
sion is narrowly tailored to further the government’s
substantial interest in preventing fraud. Pet. App. 19a.
The required disclosures permit consumers to make
informed decisions about their charitable donations, in-
cluding whether to invoke the entity-specific do-not-call
provision. See /llinois v. Telemktg. Assocs., Inc., 538
U.S. 600, 623 (2003). This Court has upheld substaa-
tially broader disclosure requirements in order to pre-
vent charitable solicitation fraud. See Riley, 487 U.S. at
799 n.11, 800 (professional fundraisers may be required
to disclose their “professional status,” and a State may
publish their “detailed financial disclosure forms”);
Munson, 467 U.S. at 961-962 n.9 (upholding law requir-
ing charity to disclose its finances).

* Petitioners incorrectly contend (Pet. 16, 17, 19) that the TSR can
pass muster under the First Amendment only if it is “the least re-
strictive means” to further the government’s interests. This Court has
never imposed that level of scrutiny on laws regulating professional
fundraising for charities. Instead, the Court has required only that the
regulations be “narrowly drawn” to serve a “sufficiently strong, subor-
dinating interest.” Munson, 467 U.S. at 960-961 (quoting Schaumburg,
444 U.S. at 636-637). Cf. Ward, 491 U.S. at 797-799 & n.6 (rejecting
assertion that narrow tailoring requirement mandates least-restrictive-
means analysis of content-neutral time, place, and manner restrictions).
In any event, the challenged TSR provisions satisfy the strict scrutiny
advocated by petitioners. Protecting the privacy of the home and pre-
venting fraud are compelling state interests, and the TSR’s provisions
directly advance those interests by imposing only the most minimal
limitations on speech. Any less restrictive alternatives (such as

12

2. Petitioners mistakenly argue (Pet. 6-16, 18-19)
that the TSR violates the First Amendment because it
is under-inclusive. Petitioners’ primary complaint is
that the TSR covers telefunders but not solicitation calls
made directly by charities themselves. As the court of
appeals explained, however, that limitation on the scope
of the TSR is “justified by a neutral and legitimate rea-
son”—the FTC’s limited jurisdiction, Pet. App. 24a; see
id. at 26a-29a. And the limits on the FTC’s jurisdiction
present no First Amendment concerns. See ?d. at 32a.

“There is no mystery * * * about why the FTC has
distinguished telefunders from in-house charity callers.”
Pet. App. 26a. The Commission has no jurisdiction over
charitable organizations, and it therefore lacks authority
to subject them to the TSR. See 68 Fed. Reg. at 4586-
4587. At the same time, in the USA PATRIOT Act, Con-
gress unambiguously directed the FTC to use the au-
thority that it does possess to prevent abusive charitable
solicitations. See 15 U.S.C. 6106(4) (2000 & Supp. II
2002). The FTC therefore included for-profit tele-
funders within the coverage of the TSR, just as the FTC
included other for-profit entities that are subject to its
jurisdiction. 68 Fed. Reg. at 4585. The FTC’s decision
to regulate all entities over which it has jurisdiction, but
only those entities, does not reflect discrimination
against any category of speech or group of speakers. On
the contrary, the FTC’s jurisdictional constraints pro-
vide a “ neutra! justification” for the scope of the TSR.
Pet. App. 28a (quoting City of Cincinnati v. Discovery
Network, Inc., 507 U.S. 410, 429-430 (1993)).

Petitioners contend (Pet. 12, 15-16) that the First
Amendment does not permit Congress to subject

permitting late night calls or calls from persons who refuse to identify
themselves) would leave consumers vulnerable to abuse or fraud.

13

telefunders to the telemarketing protections of the TSR
unless it also expands the FTC’s jurisdiction to cover in-
house charity callers. But it is perfectly reasonable for
Congress to distinguish between solicitations by profes-
sional fundraisers and solicitations by charities them-
selves. That distinction reflects the common-sense judg-
ment that for-profit solicitors are more likely to engage
in abusive or coercive telemarketing behavior because
their compensation depends on the level of contributions
they solicit. Several courts have recognized the validity
of that judgment in upholding solicitation laws that ex-
empt in-house charity callers. See Fraternal Order of
Police, N.D. State Lodge v. Stenehjem, 431 F.3d 591, 598
(8th Cir. 2005) (deferring to legislative judgment “that
professional charitable solicitors intrude more regularly
on residents’ privacy than [the charity’s] volunteers or
employees”), petition for cert. pending, No. 05-1149
(filed Mar. 6, 2006); National Coalition of Prayer, Inc.
v. Carter, No. 02-0536-C B/S, 2005 WL 2253601, at *12-
*13 (S.D. Ind. Sept. 2, 2005) (same), appeal docketed,
No. 05-3995 (7th Cir. Oct. 14, 2005); Special Programs,
Ine. v. Courter, 923 F. Supp. 851, 860 (E.D. Va. 1996)
(same); Lucas v. Curran, 856 F. Supp. 260, 273 (D. Md.
1994) (same).

This Court has also recognized that the government
may impose narrowly tailored restrictions on tele-
funders without imposing those restrictions on charities.
As noted above, in Riley, the Court expressly approved
laws that required fundraisers to disclos“ their “profes-
sional status” and provided for publication of the amount
of money that the fundraisers turned over to the chari-
ties for which they solicited, because those laws are nar-
rowly tailored to prevent telefunder fraud. Riley, 487
U.S. at 795, 799 n.11, 800.

14

There is thus no merit to petitioners’ contention (Pet.
8-9, 12, 18-19) that this Court—in Riley, Schaumburg,
and Munson—categorically rejected any connection
between the paid status of a telefunder and fraud.
Rather, in those cases, the Court struck down laws that
presumed that solicitations were fraudulent based solely
on the percentage of funds retained by the solicitor, be-
eause those laws only “peripherally promoted” the gov-
ernment’s interest in preventing fraud. Schaumburg,
444 U.S. at 636; see Riley, 487 U.S. at 788-789; Munson,
467 U.S. at 966-967. At the same time, the Court recog- ~*
nized that the “interest in protecting charities (and the
public) from fraud is, of course, a sufficiently substantial
interest to justify a narrowly tailored regulation” im-
posed on professional fundraisers. Riley, 487 U.S. at
792.

Petitioners also err in contending that Riley holds
that laws directed at telefunders but not charities them-
selves “‘necessarily’ discriminate against small or un-
popular charities.” Pet. 10-11; see Pet. 6. One of the
laws held unconstitutional in Riley required profes-
sicnal fundraisers, during the solicitation and before the
appeal for funds, to disclose the amount of money that
they turned over in the previous year to the charities for
which they solicited. The Court reasoned that this dis-
closure requirement would so prejudice “legitimate”
fundraising efforts that it would “discriminate| |” against
charities that hire professional fundraisers. 487 U.S. at
799. But the Court did not rule that all limitations di-
rected only at professional fundraisers are discrimina-
tory and unconstitutional. On the contrary, as noted
above, the Court expressly approved several limitations
of that kind because they were narrowly tailored to ad-
dress legitimate governmental interests. See id. at 795,
799 n.11, 800. The TSR’s modest strictures, including

15

the requirement that telefunders disclose the identity of
the charity for which they are soliciting and the purpose
of the call, are the sort of narrowly tailored regulations
approved in Riley. See id. at 799 n.11.

Petitioners are also mistaken in asserting (Pet. 7, 9,
12, 19) that the decision below conflicts with Discovery
Network. That case involved a city’s ban on newsracks
dispensing commercial handbills, but not newsracks dis-
pensing newspapers, for the purported purpose of pro-
moting esthetics and pubic safety.. The Court struck
down the ban, which covered approximately 4% of the
city’s newsracks, because it made only a “minute” or
“paltry” contribution to the city’s goals. 507 U.S. at 417-
418. The Court also noted that the city proffered “no
justification” for its distinction between commercial
newsracks and newspaper racks other than a “naked
assertion that commercial speech has ‘low value.’” /d.
at 429. In sharp contrast to the “paltry” manner in
which the law at issue in Discovery Network furthered
the government’s asserted interests, the TSR’s applica-
tion to telefunders directly and significantly furthers the
protection of privacy and the prevention of fraud by, for
example, restricting early-morning and late-night calls,
eliminating menacing hang-up calls, and requiring basic
disclosures about the purpose of solicitations. Mo e-
over, as discussed above, distinguishing between tele-
funders and in-house charity callers is entirely reason-
able. See p. 13, supra.

3. Petitioners also object (Pet. 7, 14, 18-19) to other
exemptions in the TSR that they contend render it
impermissibly under-inclusive. There are, however,
legitimate reasons for all of those exemptions. In each
case, the entity or speech exempted from the TSR is
either subject to another federal law protecting consum-

16

ers or does not pose the same risk of overreaching or
harassment as calls by telefunders.

First, all commercial telemarketers that are not cov-
ered by the TSR are fully covered by the FCC’s TCPA
rules, which are virtually identical in all relevant re-
spects to the TSR. See /n re TCPA, 18 F.C.C.R. at
14,034; id. at 14,138-14,139. Similarly, intrastate calls
are covered by the FCC’s parallel TCPA rules. See 47
U.S.C. 152(b); In re TCPA, 18 F.C.C.R. at 14,028; id. at
14,138-14,139.

Second, the TSR does not cover political fundraising
because political solicitations are neither commercial nor
charitable telemarketing and therefore do not fall within
the terms of the Telemarketing Act. See 15 U.S.C.
6106(4) (2000 & Supp. IT 2002); 68 Fed. Reg. at 4589 &
n.106. Laws regulating political speech pose unique
First Amendment concerns. See Burson v. Freeman,
504 U.S. 191, 196 (1992); Meyer v. Grant, 486 U.S. 414,
425 (1988). Congress has therefore decided to regulate
political fundraising under a separate regime, the Fed-
eral Election Campaign Act of 1971 (FECA), 2 U.S.C.
431 et seq., administered by a separate agency, the Fed-
eral Election Commission, which has expertise in the
area. That decision does not render the TSR constitu-
tionally suspect.

Finally, Congress’s decision not to regulate calls that
do not solicit funds, such as education or advocacy calls,
is also reasonable. Those calls do not pose the same con-
cerns as fundraising calls. See Hill v. Colorado, 530
U.S. 703, 723-724 (2000) (upholding a statute against a
charge of under-inclusiveness because the speech it per-
mitted was not “similarly likely to raise the legitimate
concerns to which [the statute] respond[ed]”); United
States v. Kokinda, 497 U.S. 720 (1990) (upholding a reg-

17

ulation that restricted solicitations, but not other forms
of expression).

4. Petitioners do not—and could not—contend that
this Court’s review is necessary to resolve any split of
authority among the courts of appeals. The courts of
appeals have consistently upheld the TSR, as well as
analogous state charitable solicitation laws. Many of
those state laws contain exemptions for in-house charity
callers, political solicitations, and other types of speech
or speakers similar to the exemptions in the TSR.

For example, the Eighth Circuit recently upheld a
state do-not-call law that applies to charitable solicita-
tions but exempts in-house charity callers, advocacy
calls, political fundraising calls, and calls to persons with
a prior business relationship. Stenehjem, 431 F.3d at
596-599; see also National Fed'n of the Blind of Ark.,
Ine. v. Pryor, 258 F.3d 851, 855 n.3, 857 (8th Cir. 2001)
(upholding law that regulates charitable and commercial
solicitations but not political solicitations or advocacy
calls). Other courts of appeals have likewise upheld
state laws restricting charitable solicitations or impos-
ing disclosure requirements that contain similar exemp-
tions from coverage. See American Target Adver., Ince.
v. Giani, 199 F.3d 1241, 1248-1249 (10th Cir.) (upholding
disclosure and other requirements imposed only on pro-
fessional charitable fundraisers), cert. denied, 531 U.S.
811 (2000); Dayton Area Visually Impaired Persons,
Ine. v. Fisher, 70 F.3d 1474, 1481-1482, 1485 (6th Cir.
1995) (upholding law requiring various disclosures by
charitable fundraisers and containing various exemp-
tions), cert. denied, 517 U.S. 1135 (1996); Auburn Police
Union v. Carpenter, 8 F.3d 886, 901 (st Cir. 1993) (up-
holding law prohibiting solicitations benefitting police
officers and containing an exemption for campaign
speech), cert. denied, 511 U.S. 1069 (1994).

18

Finally, the Tenth Circuit recently rejected a First
Amendment challenge to the nationa! TSR do-not-call
registry, which, as noted above, applies to commercial
but not charitable telemarketing. Mainstream Mktg.
Servs., Inc. v. FTC, 358 F.3d 1228 (10th Cir.), cert. de-
nied, 543 U.S. 812 (2004).

CONCLUSION
The petition for a writ of certiorari should be denied.
Respectfully submitted.

PAUL D. CLEMENT
Solicitor General

WILLIAM BLUMENTHAL
General Counsel
JOHN F. DALY
Deputy General Counsel for
Litigation
MICHAEL D. BERGMAN
Atto ney
Federal Trade Commission

APRIL 2006

. Supreme Court, U.S
j : FILED
v4 4

S MAY 5 - 2006
No. 05-927

OFFICE GF THE «

IN THE

Supreme Court of the Anited States

NATIONAL FEDERATION OF THE BLIND;
SPECIAL OLYMPICS MARYLAND, INC.,
Petitioners,

V.

FEDERAL TRADE COMMISSION,
Respondent.

Petition for a Writ of Certiorari to the
United States Court of Appeals
for the Fourth Circuit

REPLY BRIEF

ERROL COPILEVITZ

Counsel of Record
WILLIAM RANEY
COPILEVITZ & CANTER, LLC
423 W. 8th Street
Suite 400
Kansas City, Missouri 64105
(816) 472-9000

May 5, 2006 Attorneys for Petitioners

MAREE eI AOU RS NRTA ENNIO ESE OS “ENCE A
WiILSON-EPES PRINTING Co.,INC. — (202)789-0096 -— WASHINGTON, D. C.20001

TABLE OF CONTENTS

Page
PARE R RS APE PRU BF EECIUUL FLEES cccivcosuscsecccesovsceveceossoseosesoess il
tai an dees aokenuanbensentiverecieesinaiadineniion 2
A. The Court Should Consider This Petition
Concurrently With the Petition for a Writ
of Certiorari Regarding Fraternal Order of
|| SR TS AA ya kale BENS. ale LOR ORE 2
B. A Congressional Act Cannot Constitute
“Neutral Justification” for the Abridgement of
UI SII 1s sass Gi baediinevennsdevesnesdveennebebeurtobesbundans’ 3

C. The FTC’s Regulations are Content-Based
Se NII in dendckccienthhasetbsecnibebotadiovecke 4

D. The FTC Admits the Absence of any
Evidentiary Basis for the Fourth Circuit's

SESE ERSTE SES EA DEM PER Se 5

E. The FTC Failed to Address the Equal Pro-
I INI 2c ss. dub a Scar hve radaienslucnanebhnen eens 7
oS calico sascukat se sstcouniaskanriuanierckeienniore 9

(i)

TABLE OF AUTHORITIES

CASES Page
Adarand Constructors v. Pena, 515 U.S. 200,

ES Fee Rckistiinucenciirsinramesipsicipoitatbenianibeadinidl da 8
City of Cincinnati v. Discovery Network, Inc.,

SE Tees RD Sektacicasercath cckchadiasbiasinntndate 5
Fraternal Order of Police, et al. v. Stenehjem,

431 F.3d 591 (2005) ........ ‘abate eedbsnses kai ensiandeaidalaohe 1-3

Mainstream Marketing Services, Inc. v. Federal
Trade Commission, 358 F.3d 1228 (10th Cir.

PUN sc dats shcabtadadcepcritichuensussachmeastuenccasAmmdedesiit he
Riley v. National Federation of The Blind, 487

UG TE oe EE Uiiclishndevuivacedsuestelaceecdiuninaiaaen 6
Secretary of State of Maryland v. Joseph H.

Mur.son Co., Inc., 476 U.S. 947 (1984)............. 6
Shuttlesworth v. Birmingham, 394 U.S. 147

CRG cn cacaseseibadsdicciadeogieniiiccstedlnnhretcsaubusbecenacs 5
United States v. Playboy Entertainment Group,

Bebe SES Ais Pt CRIED cnckisckscitiaieeninsbsioxiniascnes 7
Village of Schaumburg v. Citizens for a Better

Environment, 444 U.S. 620 (1980).............00..... 6

OTHER

U.S. Constitution, First Amendment ..................... 34
U.S. Constitution, Fifth Amendment..................... 8
U.S. Constitution, Fourteenth Amendmert ........... 8
BE REA i ORs Gicidtcciesecskcndinrintesiantbirdnolonsss 4
ee eA EE ciiecocnins sanbacaendontphccdbcocexoncensaial 4

IN THE

Supreme Court of the United States
No. 05-927

NATIONAL FEDERATION OF THE BLIND;
SPECIAL OLYMPICS MARYLAND, INC.,
Petitioners,
Vv.

FEDERAL TRADE COMMISSION,
Respondent.

Petition for a Writ of Certiorari to the
United States Court of Appeals
for the Fourth Circuit

REPLY BRIEF

Pursuant to Supreme Court Rule 15, Petitioners National
Federation of the Blind and Special Olympics Maryland, Inc.
(“Petitioners”) respectfully submit this “Reply Brief Sup-
porting Petition for a Writ of Certiorari” to (A) request that
the Court consider this Petition concurrently with the
“Petition for a Writ of Certiorari” filed in the matter entitled
Fraternal Order of Police et al. v. Stenehjem, 431 F.3d 591
(2005), Case No. 05-1149; and (B) address matters newly
raised in the “Brief for the Federal Trade Commission in
Opposition” {the “Opposition”) filed on behalf of the Federal
Trade Commission (the “FTC’”’).

2
ARGUMENT

A. The Court Should Consider This Petition Con-
currently With the Petition for a Writ of Certiorari
Regarding Fraternal Order of Police.

In the Opposition, the FTC relies upon the recent decision
of the Eighth Circuit in Fraternal Order of Police et al. v.
Stenehjem, 431 F.3d 591 (2005). See Opposition p. 13 (citing
Fraternal Order of Police for the proposition that “several
courts have recognized the validity of that [common sensc]
judgment in upholding solicitation laws that exempt in-house
charity callers”) and p. 17 (noting that “the Eighth Circuit re-
cently upheld a state do-not-call law that applies to charitable
solicitations but exempts in-house charity callers, advocacy
calls, political fundraising calls, and calls to persons with a
prior business relationship.”’)

Both this case and Fraternal Order of Police involve the
constitutionality of charitable speech restrictions that apply
to charities using professional fundraisers to solicit by
telephone, but do not apply to charities using volunteer

fundraisers to solicit by telephone. In this case, the Fourth

Circuit has upheld the application of certain provisions of the
FTC’s Telemarketing Sales Rule (including the entity specific
do-not-call provis:on, calling time restrictions, a requirement
that telefunders transmit caller-ID information and promptly
identify the call as a solicitation, and a prohibition on aban-
doned calls) to charities using professional fundraisers. In
Fraternal Order of Police, the Eighth Circuit has upheld the
application the national do-not-call registry to charities using
professional fundraisers in North Dakota. Charities using
volunteer fundraisers are exempt from the charitable speech
restrictions at issue in these cases.

3

~

Because these cases present similar issues, Petitioners
request that the Petitions be considered together, and that
review be granted in both cases.’

B. A Congressional Act Cannot Constitute “Neutral
Justification” for the Abridgement of Free Speech.

In the Opposition, the FTC argues that its lack of juris-
diction over charities constitutes a “neutral justification” for
its disparate treatment of charities using professional fund-
raisers, stating:

‘There is no mystery . . . about why the FTC has
distinguished telefunders from in-house charity callers.’
[Citation.} The Commission has no jurisdiction over
charitable organizations, and it therefore lacks authority
to subject them to the TSR.” See Opposition, p. 12.

“On the contrary, the FTC’s jurisdictional constraints
provide a ‘neutral justification’ for the scope of the
TSR.” See Opposition, p. 12.

Absent an amendment to the Constitution, a federal
agency's jurisdictional limitations cannot constitute a “neutral
justification” justifying impairment of the freedom of speech
under the First Amendment. The First Amendment expressly
states: “Congress shall make no law . . . abridging the

' These cases exemplify the different regulations of charitable tele-
phone solicitation being imposed by the FITC, FCC and various states.
Reviewing courts are reaching inconsistent results. As pointed out by
Amicus Veterans First, in upholding the constitutionality of the national
do -not-call registry as applied to core commercial speech, the Tenth Cir-
cuit noted its exemption of all charitable solicitations. See Mainstream
Marketing Services, Inc. v. FTC, 358 F.3d 1228 (10th Cir. 2004). In
Fraternal Order of Police, the Eighth Circuit recently upheld the apph-
cation of the national do-not-call registry to charitable solicitations made
by professional fundraisers in North Dakota. These different rulings
refute the FTC's argument that “Petitioners do not and could not
contend that this Court’s review is necessary to resolve any split of
authority among the courts of appeals.” See Opposition, p. 17.

4

freedom of speech, or of the press... .” See United States
Constitution, First Amendment.

The jurisdiction of a federal agency, including the FTC, is
established by an Act of Congress. In the Opposition, p. 2,
the FTC explains: “The FTC’s jurisdiction under the
Telemarketing Act is coextensive with its jurisdiction under
the Federal Trade Commission Act (FTC Act), 15 U.S.C. 41
et seq. See 15 U.S.C. 6105(a). Its jurisdiction under the FTC
Act excludes many non-profit entities. See 15 U.S.C. 44,
45(a)(2).”

If the FTC's jurisdictional limitations abridge a charity’s
rights under the First Amendment, they are unconstitutional.
Moreover, permitting the FTC to use its jurisdiction as
“neutral justification” for abridging speech is tantamount
to arguing that any Congressional Act can be a “neutral
justification” justifying the abridgment of freedom of speech.
The First Amendment would be completely eviscerated by
allowing a Congressional Act to serve as “neutral justifica-
tion” justifying the abridgement of free speech.

C. The FTC’s Regulations are Content-Based Speech
Restrictions.

In the Opposition, the FTC argues that the challenged
regulations are content-neutral because: “The restrictions
apply to all telemarketing calls made by entities within the
FTC’s jurisdiction, regardless of the subject matter of the call
or the viewpoint expressed by the called” (see Opposition,
p. 8, and p. 9, n.1) and “the TSR ‘serves purposes unrelated to
the content of expression’—the protection of privacy and the
prevention of fraud—and it is therefore ‘deemed neutral, even
if it iias an incidental effect on some speakers or messages but
not others.’ Opposition, p. 9, n.1.

These arguments miss the mark. The challenged regula-
tions are content-based. Among other things, the underlying

5

definition of “telemarketing” contained in the TSR—“a plan,
program or campaign which is conducted to induce... a
charitable contribution . . .”—~ is so vague and overbroad that
it gives the government virtually unfettered authority to
determine, based upon the content of the speech, whether a
call is “conducted to it cuce” a contribution. Based on the
content of a call, the TSR requires the FTC to decide, for
example, whether a sees of calls only providing information
and never mentioning a request for a contribution is actually
conducted to “induce” a charitable contribution. See Shut-
tlesworth v. Birm‘ngham, 394 U.S. 147, 150-153 (1969)
(discussing the unconstitutionality of a statute which “con-
ferred upon the City Commission virtually unbridled and
absolute power to prohibit any parade, procession, or demon-
stration on the city’s streets or public ways”).

D. The FTC Admits the Absence of any Evidentiary
Basis for the Fourth Circuit’s Decision.

In City of Cincinnati v. Discovery Network, Inc., 507 U.S.
410, 414 (1993), this Court held: “It was the city’s burden to
establish a ‘reasonable fit’ between its legitimate interests in
safety and esthetics and its choice of a limited and selective
prohibition of newsracks as the means chosen to serve those
interests.” In this case, the FTC has utterly failed to establish
the existence of any legitimate interest to be remedied, much
less any “reasonable fit” between any such interest and its
selective regulation of charities using professional fund-
raisers.

In the Opposition, the FTC admits its absence of empirical
evidence supporting its selective regulation of charities using
professional fundraisers. The FTC has previously used the
absence of evidence of problems associated with charitable
calls to justify the application of the national do-not-call
registry to commercial speech. See Mainstream Marketing
Services, Inc., 358 F.3d at 1236-1237 (relying on the FTC’s

6

evidence of the harassing effects of commercial speech, and
the lack of similar evidence for charitable solicitations, to
uphold the application of the national do-not-call registry to
core commercial speech).

In the Opposition, the FTC broadly claims that “the TSR’s
application to telefunders directly and significantly furthers
the protection of privacy and the prevention of fraud” and
that “distinguishing between telefunders and in-house charity
callers is entirely reasonable.” See Opposition, p. 15.

The FTC has not identified the existence of any privacy
invasions by charities using professional fundraisers, which
might justify its regulations. Indeed, in 2004, the FTC
declared “victory” over privacy intrusions, stating, among
other things, that: “The Do Not Call Registry has made
dinner time interruptions a thing of the past.” See FTC
website, press release dated June 24, 2004, entitled “National
Do Not Call Celebrates One-Year Anniversary.” In declaring
its victory over the privacy intrusions associated with tele-
marketing, the FTC removed any possible rationalization—
much less any “sufficiently strong, subordinating interest that
the [government] is entitled to protect” (Opposition, p. 9)—
for burdening the speech of charities using professional
fundraisers.

Nor has the FTC identified the existence of any fraud that
would be remedied by the selective regulation of calls by
charities using professional fundraisers. The Supreme Court
has repeatedly rejected any connection between the fact that a
solicitor is paid for services and the likelihood that those
services are fraudulent. See Riley v. Nat'l Fed'n of the Blind
of N.C., Inc., 487 U.S. 781, 789-90 (1988), Sec’v of State of
Marvland v. Joseph H. Munson Co., Inc., 476 U.S. 947, 966-
67 (1984), and Village of Schaumburg v. Citizens for a Better
Env't, 444 U.S. 620, 636-37 (1980).

7

Having failed to offer any evidence of any legitimate
interest served by its selective regulation of charities using
professional fundraisers, the FTC urges the Court to ignore its
absence of evidence and to defer to its “common-sense
judgment that for-profit solicitors are more likely to engage in
abusive or coercive telemarketing behavior because their
compensation depends on the level of contributions they
solicit.” See Opposition, p. 13. However, there is nothing
“common-sense” about the leap that the FTC urges the Court
to make. It is equally plausible that committed volunteers of
a charity are more likely to engage in coercive solicitation
because of their personal emotional stake in the charity. It is
also likely that the coerciveness of a telephone solicitor
depends more on the individual solicitor’s temperament than
on whether they are being compensated for the call.

Thus, the FIC’s suggestion that professional solicitors
are more likely to engage in coercive solicitation is not
a “common-sense judgment;” is it sheer speculation. As
pointed out in the “Amicus Brief of Veterans First in Support
of Petition for a Writ of Certiorari by National Federation of
the Blind,” p. 5-6, such rash speculation has never been
permitted to justify restrictions on constitutional freedoms.
See United States v. Playboy Entertainment Group, Inc., 529
U.S. 803, 813 (2000) (holding that the government failed to
carry its burden where it offered “anecdotal evidence” but
“little hard evidence” and “no proof” justifying its regulation
of speech). Because there is no demonstrable need for, or
effect of, the FTC’s regulation of the speech or charities using
professional fundraisers, the regulations should be stricken.

E. The FTC Failed to Address the Equal Protection
Argument.

The regulations at issuc in this case violate the consti-

tutional promise of cqual protection. See “Amicus Brief of

Veterans First in Support of Petition for a Writ of Certiorari

8

by National Federation of the Blind.” In its Opposition, the
FTC has failed to address the equal protection violations
associated with the challenged regulations.

The FTC’s argument in its Opposition that its jurisdictional
limitations justifies its disparate treatment of charities using
professional fundraisers flies in the face of the Fourteenth
Amendment, as applied to the federal government under the
Fifth Amendment. See Adarand Constructors v. Pena, 515
U.S. 200, 217 (1995). The Fourteenth Amendment expressly
provides: “No State shall make or enforce any law which
shall abridge the privileges or immunities of citizens of the
United States; nor shall any State deprive any person of life,
liberty, or property, without due process of law; nor deny
to any person within its jurisdiction the equal protection of
the laws.” See United States Constitution, Fourteenth
Amendment.

As discussed above, jurisdictional limitations, including the
jurisdictional limitations of the FTC, are created by Acts of
Congress. See Opposition, p. 2. Allowing Congress deny
equal protection simply by making a law defining a fed-
eral agency’s jurisdiction is exactly what is proscribed by
the Fourteenth (and Fifth) Amendment, and is patently
unconstitutional.

9
CONCLUSION

Based upon the foregoing, Petitioners respectfully request
that the Court consider the Petition in this action concurrently
with the Petition for a Writ of Certiorari in the Fraternal
Order of Police, Case No. 05-1149 and grant both Petitions.

Respectfully submitted,

ERROL COPILEVITZ

Counsel of Record
WILLIAM RANEY
COPILEVITZ & CANTER, LLC
423 W. 8th Street
Suite 400
Kansas City, Missouri 64105
(816) 472-9000

May 5, 2006 Attorneys for Petitioners

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Source: Frix Law Library, https://www.frixlaw.com/law-library/documents/brief%3Amicro_IA40386016_0742%3A2. Public record. Not legal advice.