Washington state legislation could stymie Intelius

Washington state Attorney General Rob McKenna has begun shopping a bill in the legislature that would ban third-party marketing of cellphone numbers without consent of wireless subscribers, precisely the kind of law flagged by Bellvue-based Intelius Inc. in a planned $143.7 million public offering.
The Washington state legislature, which returned to session on Jan. 14, passed a bill in 2005 requiring cellular carriers to obtain express opt-in approval from consumers before publishing their wireless phone numbers in directories. But that bill did not address the subsequent emergence of online companies that sell mobile phone numbers unbeknownst to subscribers. Intelius and other firms are in the business of doing just that.
In addition to requiring prior approval from consumers before listing and selling their mobile phone numbers, the McKenna draft bill would impose a fine up to $50,000 for each violation. The measure would enable the attorney general to enforce compliance, possibly with letters of warning to first time offenders.
“Changes in the laws and regulations governing access to public information and the collection or sale of publicly-available information could make it more difficult for us to conduct business,” Intelius stated in its IPO registration statement submitted to the Securities and Exchange Commission. Intelius noted that the Federal Trade Commission and some state agencies previously “have inquired about or investigated the use and disclosure of consumers’ personal information by various Internet companies, including us.”
On the federal front, Sens. Barbara Boxer (D-Calif.), Arlen Specter (R-Pa.) and Sherrod Brown (D-Ohio) have introduced legislation intended to protect cellphone subscribers from being listed without their consent in a national directory they believe cellular industry association CTIA is compiling. However, the trade group dropped plans to publish a wireless directory in 2004, following criticism by lawmakers and privacy advocates. A subsequent attempt by large wireless carriers (Verizon Wireless excluded) to create a wireless directory was recently abandoned.