Local Search Association President Neg Norton said this about the ruling: “The Court’s ruling is good news for residents who find value in the free and easy access to community information, emergency information, and local business listings that print Yellow Pages offer. It is also a win for local businesses that depend on Yellow Pages advertising to drive new customers into their doors.”

Dex One CEO Alfred Mockett added this statement: “Today’s court decision is a victory for free speech and the rights of local business owners in the city of Seattle. We have contended from the outset this action by the City Council was a burden on local businesses and a violation of our First Amendment rights. We have always believed the ordinance was unnecessary and are pleased the Ninth Circuit has reached a decision that allows Dex One to help local businesses and consumers connect without unnecessary regulation.”

According to the Seattle Times, the city may appeal the decision. However, it sourced that statement to the ordinance’s champion, councilman Mike O’Brien, who questioned the ruling’s premise. Whether the city itself has the stomach for more litigation remains to be seen.

“I think comparing the yellow pages to The New York Times challenges most of our perception of what the Yellow Pages really are,” O’Brien told the newspaper. “I think the city clearly has a compelling government and public interest in regulating how the Yellow Pages are distributed.”

If the ruling stands, it is likely to discourage other municipalities that may have been waiting to see if the Seattle ordinance and an even more strict opt-in ordinance stood up to litigation. In San Francisco, where the ordinance limits phone book distribution only to those who actively request a printed book, both sides are awaiting a district court decision on a lawsuit brought by publishers and the Local Search Association.

The Seattle decision has given the industry confidence that things will go their way in an Francisco as well.

“In light of this decision, we are optimistic the District Court in San Francisco, also in the Ninth Circuit, will quickly overturn that City’s even more restrictive ordinance,” Norton said.

The opt-out ordinance did have some public support in Seattle, with 79,000 residents reportedly opting out of phone book delivery since the ordinance was passed.

The Yellow Pages industry would argue that those residents can always opt-out via the industry’s opt-out website. The Seattle ordinance went further than simply requiring opt-out. It also required a license to distribute phone books and fees for processing phone books that end up in city recycling bins, among other restrictions.

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A federal judge upheld Seattle’s opt-out registry this week for residents who choose not to receive Yellow Pages. U.S. District Court Judge James L. Robart said the city’s opt-out ordinance does not violate the Yellow Pages publishers’ First Amendment rights. He also ruled that the benefits to the city of Seattle in waste reduction, resident privacy and cost recovery outweighed any burdens placed on the publisher’s interstate commerce rights. 

We reported on the bill’s initial passing last October. The Yellow Pages industry challenged the constitutionality of the legislation a month later. The city modified the ordinance last February to eliminate a delivery fee, but its efforts did not deter YP’s lawsuit.

After the industry failed to win a restraining order from a U.S. District Court, the opt-out ordinance moved forward. Since the city launched its own opt-out website last month, more than 35,000 households have opted out of receiving phone books, according to Seattle Public Utilities.

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Pauline Martinson, head of the nonprofit waste-prevention group, I Love A Clean San Diego, told the Union-Tribune, “To most of us, they are no longer necessary.” The UT article also suggested major cities like San Diego and Chicago may jump on the bandwagon if the San Francisco ordinance survives court challenges from the industry.

Richard Anthony, who runs a San Diego zero-waste consulting firm, isn’t on board with the opt-in movement. Anthony said, “the free market should dictate the fate of phone books.”

Steven Osinski, an authority on phone book advertising and teacher at San Diego State’s business school, told the newspaper he doesn’t expect phone books to disappear but acknowledges that they “face major challenges staying relevant in the digital age.”

“As this generation grows up, they’re not interested in the print product,” Osinski said. “They want immediate access to updated information.”

BIA/Kelsey will release an advisory later this week on the history of opt-in/opt-legislation and the implications for the industry.

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The Yellow Pages industry has failed to win a preliminary injunction or restraining order from a U.S. District Court in Seattle. This mean the Seattle opt-out ordinance can move forward as the industry pursues its lawsuit seeking to have the ordinance ruled unconstitutional. This decision doesn’t mean the lawsuit will fail, but it does seem to suggest victory is not assured. The industry can either just carry on with the suit or appeal the District Court decision to the 9th Circuit Court in San Francisco.

The Seattle lawsuit, filed by the Local Search Association, Dex One and SuperMedia, followed passage of an opt-out measure by the Seattle city council.

Tomorrow, the San Francisco Board of Supervisors is expected to vote on an opt-in measure, which had been delayed pending a report on the proposed ordinance’s impact on small businesses. The Yellow Pages industry rallied all of the affected constituencies, including unions and small businesses, to oppose the opt-in ordinance. This effort led to delay for further study. Whether it’s enough to stave off final passage remains to be seen.

On Monday, the San Francisco Bay Guardian published an online poll asking consumers to weigh in on the opt-in ordinance. Both the Association of Directory Publishers and the Local Search Association sent email alerts to their members, asking them to vote in the poll. Whether the poll results will have any influence on Tuesday’s vote is unclear.

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The San Francisco board of supervisors (the city council, essentially) today will consider a phone book opt-in ordinance that directory publishers believe will be devastating to their business. The measure, supported by announced mayoral candidate David Chiu, has drawn urgent opposition from the directory publishing industry, as well as local businesses that rely on Yellow Pages leads. Unions representing workers whose jobs would be at stake under an opt-in regime have also joined the fight.

It’s unclear whether the measure will face a vote today, but so far it has sailed through all the steps leading up to a final vote, so passage seems possible, if not likely.

The San Francisco measure is the toughest yet proposed in a major U.S. city. Seattle recently passed a tough opt-in bill, which prompted an industry lawsuit. Seattle has since modified the bill, but the lawsuit remains active.

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The City of Seattle has modified its tough Yellow Pages opt-out ordinance, but apparently not sufficiently to make a federal lawsuit challenging the ordinance go away. The city has eliminated a $148 per ton fee for Yellow Pages deliveries in Seattle. A $0.14 per copy “advance recovery fee” remains in the ordinance.

The Yellow Pages Association‘s response was: “The changes do not go far enough. It’s time for the City Council to simply repeal this poorly conceived law in its entirety. We will continue our case in Federal Court to overturn this law.”

The ordinance was originally passed back in October by an 8-1 vote. The lawsuit, with the YPA, Dex One and SuperMedia named as plaintiffs, was filed on Nov. 15. The Association of Directory Publishers voiced support for the litigation, but chose not to be named a plaintiff.

While the fight continues in Seattle, the industry has a new battle on its hands in San Francisco, where a more onerous opt-in bill has been proposed. We blogged on this development earlier this week.

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Two sometimes rival U.S. directory industry associations have joined forces to build a more robust one-stop opt-out Web site (due out early next year) that they hope will mitigate the growing trend toward  local opt-out legislation. The new site will replace the existing www.yellowpagesoptout.com and will use the same URL.

The industry has followed a two-pronged path in the face of legislation aimed at curbing directory distribution. The first element is to fight each piece of legislation, and the second is to promote self-regulation as a preferable alternative to government mandates. A stronger online effort to provide a one-stop opt-out resource is key to the latter element of the strategy having any credibility.

On a webinar last week, the Yellow Pages Association and Association of Directory Marketing cited the Direct Marketing Association as their model, noting that since they DMA launched its own robust national opt-out mechanism, via a Web site, the direct marketing industry has seen legislative efforts to curb direct mail abate significantly.

This effort to build a robust opt-out self-policing mechanism has taken on added urgency because of what the industry is facing in Seattle, where a pretty tough piece of opt-out legislation continues to work its way through the city’s legislative process. Last Tuesday, a council committee passed the ordinance, and a vote by the full city council is possible as early as today, according to the YPA. All the publishers that operate in Seattle (DexOne, SuperMedia, Yellowbook) have agreed to participate on the new industry opt-out site.

On the webinar last week, ADP President Larry Angove was particularly blunt in describing the stakes for directory publishers. “If what is going on in Seattle hasn’t scared the daylights out of you, then you are in denial,” Angove said. “The best and only way to avoid [further legislative action] is self-regulation.”

Angove’s constituency is primarily smaller, independent publishers that arguably have been less aggressive in combating the opt-out wave head with self-regulation. DexOne is probably the most progressive in this area, having launched a robust Web site, www.selectyourdex.com, that in many ways is the model for the new industry-wide effort to be launched in early 2011.

The Seattle legislation would do several things designed to ensure that consumers who don’t want phone books don’t get them, and that the city recovers the costs it incurs in the process of disposing of old and unwanted phone books. These include establishing a city-run (but third-party managed) Web site where Seattle consumers could go to opt out; assess “advance recovery” fees on phone book publishers to pay for the Web site and the cost of disposal (14 cents per book plus $148 a ton); require lifetime opt-out recognition (the associations say three years is more reasonable); and require prominent display of opt-out information on directory covers. In addition, substantial fines will be assessed for violations.

Some of the upcoming site features touted by the associations include the ability to opt out or opt in for up to three additional directories (similar to Select Your Dex), tracking of opt-out records in case of disputes, daily updates, and reporting of opt-out usage data. The associations also plan to survey consumers on a regular basis to ensure the system is effective. The site is still in the conceptual phase. While the associations said Jan. 1 was the projected launch, they made it clear that it could take a bit longer to get the site ready for launch.

Update: In a memorandum sent around to ADP members today, association President Larry Angove said the Seattle ordinance is up for a vote today and is expected to pass “by a significant majority.”

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For the past few years, the U.S. Yellow Pages industry has been playing a nationwide version of the arcade game “whack a mole” — beating down one opt-in or opt-out legislative initiative after another with a metaphoric sledgehammer.

For the most part, these efforts have succeeded. Last week was different. A committee of the California state senate passed a very strict White Pages opt-out measure by a 6-4 vote. The Yellow Pages industry (on this one, rival trade groups YPA and ADP are on the same page) doesn’t just fear the consequences in California. What really makes publishers perspire is the idea of copycat legislation — something particularly dangerous when a bill passes in a bellwether state like California.

State and local legislative bodies have targeted directory publishers because directories have become a visible symbol of waste to many, particularly in markets where there are multiple books distributed and in dense urban markets where stacks of phone books are often left uncollected in apartments foyers, photos of which have become the de facto symbols of the opt-out movement. The directory industry has countered that the environmental impact is exaggerated and that it can address any waste problems through self-regulation.

This is how ADP (the group representing smaller, independent directory publishers) President Larry Angove describes the California measure in a letter e-mailed this afternoon to the association membership:

“SB 920 mandates White Pages opt-out, requires independent publishers to honor opt-out requests made directly to the telephone company, establishes virtual lifetime opt-out, stipulates onerous cover language, dictates directory components, requires inclusion of recycling information in a directory, demands publisher participation in a program or organization promoting recycling, insists that publishers comply with state newsprint recycled content law, and criminalizes non-compliance with the law.”

The next step is the Senate Appropriations Committee, which is expected to pass the measure, meaning it’s likely to face a vote by the full senate. The bill was originally written as an opt-in measure, but later amended into an opt-out. However, the industry still sees the measure as unduly harsh.

In his letter, Angove makes clear the importance to publishers of defeating the bill.

“The defeat of SB 920 is critical,” he writes. “If SB 920 passes, copycat legislation across the country is a realistic threat. Prepare for battle!”

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