Finally, we are concerned with the requirement in the House bill which requires a person to check a yes box and return it to the direct marketing company before his name be—may appear on the list. We are in the business of marketing our products and services. Studies have shown that non-sales related information in separate notices and things of that nature significantly decreases response. It is not that we don't want to do this. We will do it and we have included in our testimony, many, many examples of many companies, public interest organizations such as consumers union and the American Express, which is mentioned here, which give people this opportunity.

But the Privacy Protection Study Commission itself recognized there is a great deal of diversity in the direct marketing business and there is—there should be flexibility in how we provide the notice. We would like that kind of flexibility.

In closing, I think that just two thoughts here, three thoughts, I guess. One is we do think that this bill should be limited to the evils which everybody described, which deal with libraries and in this specific case revealing of information from the rental of video tapes from retail stores.

Secondly, we do not believe that the simple existence of a mailing list and mailing to customers because of particular interests they may have violates privacy. And, third, we would like to have the flexibility within the context of the bill in order to be able to rent our specialty lists. We want to sincerely and strongly thank the two subcommittees for hearing this testimony, and we are looking forward to working with you in the future, as we have in the past on issues of great concern to us all.

Thank you.

Mr. KASTENMEIER. Thank you very much, Mr. Barton. Your remarks conclude the prepared testimony.

[The statement of Mr. Barton follows:]

Before the

UNITED STATES HOUSE OF REPRESENTATIVES

COMMITTEE ON THE JUDICIARY

SUBCOMMITTEE ON COURTS, CIVIL LIBERTIES

AND THE ADMINISTRATION OF JUSTICE

and

UNITED STATES SENATE

COMMITTEE ON THE JUDICIARY

SUBCOMMITTEE ON TECHNOLOGY AND THE LAW

TESTIMONY OF

RICHARD A. BARTON

Senior Vice President

Government Affairs

DIRECT MARKETING ASSOCIATION

August 3, 1988

Contact: Richard Barton

(202) 347-1222

Ronald Plesser

(202) 861-3969

SUMMARY OF TESTIMONY OF RICHARD A. BARTON

The Direct Marketing Association ("DMA") has been

carefully following the Video and Library Privacy Protection Act of 1988 and agree that the public disclosure of Robert Bork's video rental choices should not have been made. It is our hope that we can support a legislative remedy to that problem.

However, it is with much regret that I have to say that given its current coverage of direct marketing, DMA and its members will have to oppose this legislation.

The direct marketing industry shares this committee's concern that personal privacy be protected in the use of video customer information lists and pledges that our industry will continue its successful seventeen year effort to further the privacy interests of our customers. DMA started its privacy efforts in 1972 and has spent much time, money and effort to inform the public of its mail preference system. We believe that as the result of these efforts and the notices placed in consumer material by most marketers that the public is aware of its ability to restrict the use of names for marketing

purposes.

In summary, we contend, however, in the context of video that this legislation should be limited to retail rental establishments. Further, we believe that any person renting or exchanging a mailing list should be able to describe the character or the nature of the video rented, e.g. sports video as long as the customer is given the opportunity to object to the sale or exchange of the customer's name.

90-845 0 - 89 - 4

TESTIMONY

Good morning, my name is Richard A. Barton, and I am Senior Vice President of the Direct Marketing Association

responsible for government relations.

DMA has been carefully following the Video and Library Privacy Protection Act of 1988 and agree that the public disclosure of Judge Robert Bork's video rental choices should not have been made. It is our hope that we can support a legislative remedy to that problem. However, it is with much regret that I have to say that given its current coverage of direct marketing, DMA and its members will have to oppose this legislation.

As currently drafted, this legislation adversely affects the direct marketer's most important business asset: the mailing list. There is no evidence that direct marketing companies have done what was done to Judge Bork or anything else adverse to its customers. We do not publicly disclose information about what a person buys. We have a 17-year-old system in place whereby customers may have their names removed from our lists. I will discuss this system in a moment. We do not feel that our legitimate commercial activities need to be regulated by a bill whose purpose it is to protect consumers from an abuse which we have not committed.

The direct marketing industry shares this committee's concern that personal privacy be protected in the use of video customer information and pledges that our industry will

continue its successful seventeen year effort to further the privacy interests of our customers. DMA started its privacy efforts in 1972 and has spent much time, money and effort to inform the public of its mail preference system. We believe that as the result of these efforts and the notices placed in consumer material by most marketers that the public is aware of its ability to restrict the use of names for marketing purposes. This process of name removal or Mail Preference Service ("MPS") has been endorsed by the President's Office of Consumer Affairs, the Better Business Bureau and consumer officials in many states. Most of our members have their own

MPS services.

Examples of how these companies notify their customers of how to have their names removed from lists are attached to my testimony.

In summary, we contend, however, in the context of video, that this legislation should be limited to retail rental establishments. Further, we believe that any person renting or exchanging a mailing list should be able to describe the character or the nature of the video rented, e.g. sports video as long as the customer is given the opportunity to object to the exchange or rental of the customer's name.

DMA has nearly 3000 member firms nationwide which manufacturing,

represent every functional level of industry

wholesale and retail. These companies market goods and

services through direct response methods, including direct mail