[Congressional Bills 106th Congress]
[From the U.S. Government Publishing Office]
[H.R. 170 Reported in House (RH)]





                                                 Union Calendar No. 251

106th CONGRESS

  1st Session

                               H. R. 170

                          [Report No. 106-431]

_______________________________________________________________________

                                 A BILL

 To require certain notices in any mailing using a game of chance for 
     the promotion of a product or service, and for other purposes.

_______________________________________________________________________

                            November 1, 1999

  Reported with an amendment, committed to the Committee of the Whole 
       House on the State of the Union, and ordered to be printed





                                                 Union Calendar No. 251
106th CONGRESS
  1st Session
                                H. R. 170

                          [Report No. 106-431]

 To require certain notices in any mailing using a game of chance for 
     the promotion of a product or service, and for other purposes.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                            January 6, 1999

  Mr. LoBiondo (for himself and Mr. Condit) introduced the following 
     bill; which was referred to the Committee on Government Reform

                            November 1, 1999

     Additional sponsors: Mr. Cardin, Mrs. Myrick, Ms. Carson, Ms. 
     Millender-McDonald, Mr. Underwood, Mr. Gilman, Mr. Weldon of 
 Pennsylvania, Mr. Quinn, Mr. Cooksey, Mr. Kasich, Mr. Bilirakis, Mr. 
Barrett of Wisconsin, Ms. Danner, Mr. Hilliard, Mr. Olver, Mr. Castle, 
  Mr. Gilchrest, Mrs. Kelly, Mr. Franks of New Jersey, Mr. Wamp, Mr. 
Stenholm, Ms. Slaughter, Mr. Salmon, Mr. Moran of Virginia, Mr. George 
     Miller of California, Mr. Frost, Mr. Bishop, Mr. Bilbray, Mr. 
 Greenwood, Mrs. Thurman, Ms. Roybal-Allard, Mr. Pallone, Mr. Saxton, 
Mr. Hinchey, Ms. Pelosi, Mr. LaFalce, Mr. Faleomavaega, Mr. Stark, Mr. 
    Kucinich, Mr. Baldacci, Mr. Tanner, Mr. Wise, Mr. Bentsen, Mrs. 
Christensen, Mr. Boyd, Mr. Andrews, Mr. Shows, Mr. Wynn, Mr. Taylor of 
 Mississippi, Mrs. Capps, Mr. Gibbons, Mr. Frelinghuysen, Mr. Inslee, 
Mr. McGovern, Mr. Upton, Mr. Ganske, Mr. Ramstad, Mr. Deal of Georgia, 
  Mr. Cook, Mr. Forbes, Mr. Gekas, Mr. Gillmor, Mr. Horn, Mr. Weller, 
 Mrs. Biggert, Mr. Bereuter, Mr. Borski, Mr. DeFazio, Mrs. Johnson of 
  Connecticut, Mrs. Morella, Mr. Wexler, Mr. Bateman, Mr. Oxley, Mr. 
Foley, Mr. Kolbe, Mrs. Emerson, Mr. Watkins, Mr. Luther, Mr. Ewing, Mr. 
 LaTourette, Mr. Ehlers, Mr. Traficant, Mr. Sweeney, Mrs. Roukema, Ms. 
 Pryce of Ohio, Mr. Edwards, Mr. Hill of Indiana, Mr. Young of Alaska, 
   Mr. Shays, Mr. Gary Miller of California, Mr. Hall of Texas, Mr. 
Holden, Mr. Doyle, Mr. Smith of New Jersey, Mr. Menendez, Mr. Pascrell, 
Ms. Norton, Mr. Moakley, Mr. Brown of California, Mr. Blagojevich, Mr. 
 Gejdenson, Mr. Boucher, Mr. King, Mr. Bliley, Mr. Ehrlich, Ms. Eddie 
 Bernice Johnson of Texas, Mr. Rothman, Mr. Ford, Mr. Scarborough, Mr. 
 Bryant, Mr. Holt, Ms. Berkley, Mr. Clyburn, Mr. Lipinski, Mr. Engel, 
   Mr. Cummings, Mr. Sherman, Mr. Dixon, Mrs. Tauscher, Mr. Davis of 
 Illinois, Mr. Stump, Mr. Wu, Mr. Kuykendall, Mr. Rush, Mr. Gonzalez, 
     Mr. Duncan, Mr. Cramer, Ms. Schakowsky, Mr. Abercrombie, Ms. 
   Kilpatrick, Mr. Costello, Mr. Sanders, Mr. Camp, Ms. Woolsey, Mr. 
Calvert, Mr. Meehan, Mr. Gordon, Mr. Davis of Florida, Mr. McNulty, Mr. 
 Smith of Washington, Mr. Royce, Mr. Udall of New Mexico, Mr. Udall of 
Colorado, Mr. Lucas of Kentucky, Mr. Reyes, Mr. Waxman, and Mr. Hall of 
                                  Ohio

                            November 1, 1999

  Reported with an amendment, committed to the Committee of the Whole 
       House on the State of the Union, and ordered to be printed
 [Strike out all after the enacting clause and insert the part printed 
                               in italic]
[For text of introduced bill, see copy of bill as introduced on January 
                                6, 1999]

_______________________________________________________________________

                                 A BILL


 
 To require certain notices in any mailing using a game of chance for 
     the promotion of a product or service, and for other purposes.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Deceptive Mail Prevention and 
Enforcement Act''.

SEC. 2. RESTRICTIONS ON MAILINGS USING MISLEADING REFERENCES TO THE 
              UNITED STATES GOVERNMENT.

    Section 3001 of title 39, United States Code, is amended--
            (1) in subsection (h)--
                    (A) in the first sentence by striking ``contains a 
                seal, insignia, trade or brand name, or any other term 
                or symbol that reasonably could be interpreted or 
                construed as implying any Federal Government 
                connection, approval or endorsement'' and inserting the 
                following: ``which reasonably could be interpreted or 
                construed as implying any Federal Government 
                connection, approval, or endorsement through the use of 
                a seal, insignia, reference to the Postmaster General, 
                citation to a Federal statute, name of a Federal 
                agency, department, commission, or program, trade or 
                brand name, or any other term or symbol; or contains 
                any reference to the Postmaster General or a citation 
                to a Federal statute that misrepresents either the 
                identity of the mailer or the protection or status 
                afforded such matter by the Federal Government''; and
                    (B) in paragraph (2)--
                            (i) in subparagraph (A) by striking ``and'' 
                        at the end;
                            (ii) in subparagraph (B) by striking ``or'' 
                        at the end and inserting ``and''; and
                            (iii) by inserting after subparagraph (B) 
                        the following:
                    ``(C) such matter does not contain a false 
                representation stating or implying that Federal 
                Government benefits or services will be affected by any 
                purchase or nonpurchase; or'';
            (2) in subsection (i) in the first sentence--
                    (A) in the first sentence by striking ``contains a 
                seal, insignia, trade or brand name, or any other term 
                or symbol that reasonably could be interpreted or 
                construed as implying any Federal Government 
                connection, approval or endorsement'' and inserting the 
                following: ``which reasonably could be interpreted or 
                construed as implying any Federal Government 
                connection, approval, or endorsement through the use of 
                a seal, insignia, reference to the Postmaster General, 
                citation to a Federal statute, name of a Federal 
                agency, department, commission, or program, trade or 
                brand name, or any other term or symbol; or contains 
                any reference to the Postmaster General or a citation 
                to a Federal statute that misrepresents either the 
                identity of the mailer or the protection or status 
                afforded such matter by the Federal Government''; and
                    (B) in paragraph (2)--
                            (i) in subparagraph (A) by striking ``and'' 
                        at the end;
                            (ii) in subparagraph (B) by striking ``or'' 
                        at the end and inserting ``and''; and
                            (iii) by inserting after subparagraph (B) 
                        the following:
                    ``(C) such matter does not contain a false 
                representation stating or implying that Federal 
                Government benefits or services will be affected by any 
                contribution or noncontribution; or'';
            (3) by redesignating subsections (j) and (k) as subsections 
        (m) and (n), respectively; and
            (4) by inserting after subsection (i) the following:
    ``(j)(1) Any matter otherwise legally acceptable in the mails which 
is described in paragraph (2) is nonmailable matter, shall not be 
carried or delivered by mail, and shall be disposed of as the Postal 
Service directs.
    ``(2) Matter described in this paragraph is any matter that--
            ``(A) constitutes a solicitation for the purchase of or 
        payment for any product or service that--
                    ``(i) is provided by the Federal Government; and
                    ``(ii) may be obtained without cost from the 
                Federal Government; and
            ``(B) does not contain a clear and conspicuous statement 
        giving notice of the information set forth in clauses (i) and 
        (ii) of subparagraph (A).''.

SEC. 3. RESTRICTIONS ON SWEEPSTAKES AND DECEPTIVE MAILINGS.

    Section 3001 of title 39, United States Code, is amended by 
inserting after subsection (j) (as added by section 2(4) of this Act) 
the following:
    ``(k)(1) In this subsection--
            ``(A) the term `clearly and conspicuously displayed' means 
        presented in a manner that is readily noticeable, readable, and 
        understandable to the group to whom the applicable matter is 
        disseminated;
            ``(B) the term `facsimile check' means any matter that--
                    ``(i) is designed to resemble a check or other 
                negotiable instrument; but
                    ``(ii) is not negotiable;
            ``(C) the term `skill contest' means a puzzle, game, 
        competition, or other contest in which--
                    ``(i) a prize is awarded or offered;
                    ``(ii) the outcome depends predominately on the 
                skill of the contestant; and
                    ``(iii) a purchase, payment, or donation is 
                required or implied to be required to enter the 
                contest; and
            ``(D) the term `sweepstakes' means a game of chance for 
        which no consideration is required to enter.
    ``(2) Except as provided in paragraph (4), any matter otherwise 
legally acceptable in the mails which is described in paragraph (3) is 
nonmailable matter, shall not be carried or delivered by mail, and 
shall be disposed of as the Postal Service directs.
    ``(3) Matter described in this paragraph is any matter that--
            ``(A)(i) includes entry materials for a sweepstakes or a 
        promotion that purports to be a sweepstakes; and
            ``(ii)(I) does not contain a statement that discloses in 
        the mailing, in the rules, and on the order or entry form, that 
        no purchase is necessary to enter such sweepstakes;
            ``(II) does not contain a statement that discloses in the 
        mailing, in the rules, and on the order or entry form, that a 
        purchase will not improve an individual's chances of winning 
        with such entry;
            ``(III) does not state all terms and conditions of the 
        sweepstakes promotion, including the rules and entry procedures 
        for the sweepstakes;
            ``(IV) does not disclose the sponsor or mailer of such 
        matter and the principal place of business or an address at 
        which the sponsor or mailer may be contacted;
            ``(V) does not contain sweepstakes rules that state--
                    ``(aa) the estimated odds of winning each prize;
                    ``(bb) the quantity, estimated retail value, and 
                nature of each prize; and
                    ``(cc) the schedule of any payments made over time;
            ``(VI) represents that individuals not purchasing products 
        or services may be disqualified from receiving future 
        sweepstakes mailings;
            ``(VII) requires that a sweepstakes entry be accompanied by 
        an order or payment for a product or service previously 
        ordered;
            ``(VIII) represents that an individual is a winner of a 
        prize unless that individual has won such prize; or
            ``(IX) contains a representation that contradicts, or is 
        inconsistent with sweepstakes rules or any other disclosure 
        required to be made under this subsection, including any 
        statement qualifying, limiting, or explaining the rules or 
        disclosures in a manner inconsistent with such rules or 
        disclosures;
            ``(B)(i) includes entry materials for a skill contest or a 
        promotion that purports to be a skill contest; and
            ``(ii)(I) does not state all terms and conditions of the 
        skill contest, including the rules and entry procedures for the 
        skill contest;
            ``(II) does not disclose the sponsor or mailer of the skill 
        contest and the principal place of business or an address at 
        which the sponsor or mailer may be contacted; or
            ``(III) does not contain skill contest rules that state, as 
        applicable--
                    ``(aa) the number of rounds or levels of the 
                contest and the cost to enter each round or level;
                    ``(bb) that subsequent rounds or levels will be 
                more difficult to solve;
                    ``(cc) the maximum cost to enter all rounds or 
                levels;
                    ``(dd) the estimated number or percentage of 
                entrants who may correctly solve the skill contest or 
                the approximate number or percentage of entrants 
                correctly solving the past 3 skill contests conducted 
                by the sponsor;
                    ``(ee) the identity or description of the 
                qualifications of the judges if the contest is judged 
                by other than the sponsor;
                    ``(ff) the method used in judging;
                    ``(gg) the date by which the winner or winners will 
                be determined and the date or process by which prizes 
                will be awarded;
                    ``(hh) the quantity, estimated retail value, and 
                nature of each prize; and
                    ``(ii) the schedule of any payments made over time; 
                or
            ``(C) includes any facsimile check that does not contain a 
        statement on the check itself that such check is not a 
        negotiable instrument and has no cash value.
    ``(4) Matter that appears in a magazine, newspaper, or other 
periodical shall be exempt from paragraph (2) if such matter--
            ``(A) is not directed to a named individual; or
            ``(B) does not include an opportunity to make a payment or 
        order a product or service.
    ``(5) Any statement, notice, or disclaimer required under paragraph 
(3) shall be clearly and conspicuously displayed. Any statement, 
notice, or disclaimer required under subclause (I) or (II) of paragraph 
(3)(A)(ii) shall be displayed more conspicuously than would otherwise 
be required under the preceding sentence.
    ``(6) In the enforcement of paragraph (3), the Postal Service shall 
consider all of the materials included in the mailing and the material 
and language on and visible through the envelope or outside cover or 
wrapper in which those materials are mailed.
    ``(l)(1) Any person who uses the mails for any matter to which 
subsection (h), (i), (j), or (k) applies shall adopt reasonable 
practices and procedures to prevent the mailing of such matter to any 
person who, personally or through a conservator, guardian, or 
individual with power of attorney--
            ``(A) submits to the mailer of such matter a written 
        request that such matter should not be mailed to such person; 
        or
            ``(B)(i) submits such a written request to the attorney 
        general of the appropriate State (or any State government 
        officer who transmits the request to that attorney general); 
        and
            ``(ii) that attorney general transmits such request to the 
        mailer.
    ``(2) Any person who mails matter to which subsection (h), (i), 
(j), or (k) applies shall maintain or cause to be maintained a record 
of all requests made under paragraph (1). The records shall be 
maintained in a form to permit the suppression of an applicable name at 
the applicable address for a 5-year period beginning on the date the 
written request under paragraph (1) is submitted to the mailer.''.

SEC. 4. POSTAL SERVICE ORDERS TO PROHIBIT DECEPTIVE MAILINGS.

    Section 3005(a) of title 39, United States Code, is amended--
            (1) by striking ``or'' after ``(h),'' each place it 
        appears; and
            (2) by inserting ``, (j), or (k)'' after ``(i)'' each place 
        it appears.

SEC. 5. TEMPORARY RESTRAINING ORDER FOR DECEPTIVE MAILINGS.

    (a) In General.--Section 3007 of title 39, United States Code, is 
amended--
            (1) by redesignating subsection (b) as subsection (c); and
            (2) by striking subsection (a) and inserting the following:
    ``(a)(1) In preparation for or during the pendency of proceedings 
under section 3005, the Postal Service may, under the provisions of 
section 409(d), apply to the district court in any district in which 
mail is sent or received as part of the alleged scheme, device, 
lottery, gift enterprise, sweepstakes, skill contest, or facsimile 
check or in any district in which the defendant is found, for a 
temporary restraining order and preliminary injunction under the 
procedural requirements of rule 65 of the Federal Rules of Civil 
Procedure.
    ``(2)(A) Upon a proper showing, the court shall enter an order 
which shall--
            ``(i) remain in effect during the pendency of the statutory 
        proceedings, any judicial review of such proceedings, or any 
        action to enforce orders issued under the proceedings; and
            ``(ii) direct the detention by the postmaster, in any and 
        all districts, of the defendant's incoming mail and outgoing 
        mail, which is the subject of the proceedings under section 
        3005.
    ``(B) A proper showing under this paragraph shall require proof of 
a likelihood of success on the merits of the proceedings under section 
3005.
    ``(3) Mail detained under paragraph (2) shall--
            ``(A) be made available at the post office of mailing or 
        delivery for examination by the defendant in the presence of a 
        postal employee; and
            ``(B) be delivered as addressed if such mail is not clearly 
        shown to be the subject of proceedings under section 3005.
    ``(4) No finding of the defendant's intent to make a false 
representation or to conduct a lottery is required to support the 
issuance of an order under this section.
    ``(b) If any order is issued under subsection (a) and the 
proceedings under section 3005 are concluded with the issuance of an 
order under that section, any judicial review of the matter shall be in 
the district in which the order under subsection (a) was issued.''.
    (b) Repeal.--
            (1) In general.--Section 3006 of title 39, United States 
        Code, and the item relating to such section in the table of 
        sections for chapter 30 of such title are repealed.
            (2) Conforming amendments.--(A) Section 3005(c) of title 
        39, United States Code, is amended by striking ``section and 
        section 3006 of this title,'' and inserting ``section,''.
            (B) Section 3011(e) of title 39, United States Code, is 
        amended by striking ``3006, 3007,'' and inserting ``3007''.

SEC. 6. CIVIL PENALTIES AND COSTS.

    Section 3012 of title 39, United States Code, is amended--
            (1) in subsection (a) by striking ``$10,000 for each day 
        that such person engages in conduct described by paragraph (1), 
        (2), or (3) of this subsection.'' and inserting ``$50,000 for 
        each mailing of less than 50,000 pieces; $100,000 for 
each mailing of 50,000 to 100,000 pieces; with an additional $10,000 
for each additional 10,000 pieces above 100,000, not to exceed 
$2,000,000.'';
            (2) in paragraphs (1) and (2) of subsection (b) by 
        inserting after ``of subsection (a)'' the following: ``, (c), 
        or (d)'';
            (3) by redesignating subsections (c) and (d), as 
        subsections (e) and (f), respectively; and
            (4) by inserting after subsection (b) the following:
    ``(c)(1) In any proceeding in which the Postal Service may issue an 
order under section 3005(a), the Postal Service may in lieu of that 
order or as part of that order assess civil penalties in an amount not 
to exceed $25,000 for each mailing of less than 50,000 pieces; $50,000 
for each mailing of 50,000 to 100,000 pieces; with an additional $5,000 
for each additional 10,000 pieces above 100,000, not to exceed 
$1,000,000.
    ``(2) In any proceeding in which the Postal Service assesses 
penalties under this subsection the Postal Service shall determine the 
civil penalty taking into account the nature, circumstances, extent, 
and gravity of the violation or violations of section 3005(a), and with 
respect to the violator, the ability to pay the penalty, the effect of 
the penalty on the ability of the violator to conduct lawful business, 
any history of prior violations of such section, the degree of 
culpability and other such matters as justice may require.
    ``(d) Any person who violates section 3001(l) shall be liable to 
the United States for a civil penalty not to exceed $10,000 for each 
mailing to an individual.''.

SEC. 7. ADMINISTRATIVE SUBPOENAS.

    (a) In General.--Chapter 30 of title 39, United States Code, is 
amended by adding at the end the following:
``Sec. 3016. Administrative subpoenas
    ``(a) Subpoena Authority.--
            ``(1) Investigations.--
                    ``(A) In general.--In any investigation conducted 
                under section 3005(a), the Postmaster General may 
                require by subpoena the production of any records 
                (including books, papers, documents, and other tangible 
                things which constitute or contain evidence) which the 
                Postmaster General considers relevant or material to 
                such investigation.
                    ``(B) Condition.--No subpoena shall be issued under 
                this paragraph except in accordance with procedures, 
                established by the Postal Service, requiring that--
                            ``(i) a specific case, with an individual 
                        or entity identified as the subject, be opened 
                        before a subpoena is requested;
                            ``(ii) appropriate supervisory and legal 
                        review of a subpoena request be performed; and
                            ``(iii) delegation of subpoena approval 
                        authority be limited to the Postal Service's 
                        General Counsel or a Deputy General Counsel.
            ``(2) Statutory proceedings.--In any statutory proceeding 
        conducted under section 3005(a), the Judicial Officer may 
        require by subpoena the attendance and testimony of witnesses 
        and the production of any records (including books, papers, 
        documents, and other tangible things which constitute or 
        contain evidence) which the Judicial Officer considers relevant 
        or material to such proceeding.
            ``(3) Rule of construction.--Nothing in paragraph (2) shall 
        be considered to apply in any circumstance to which paragraph 
        (1) applies.
    ``(b) Service.--
            ``(1) Service within the united states.--A subpoena issued 
        under this section may be served by a person designated under 
        section 3061 of title 18 at any place within the territorial 
        jurisdiction of any court of the United States.
            ``(2) Foreign service.--Any such subpoena may be served 
        upon any person who is not to be found within the territorial 
        jurisdiction of any court of the United States, in such manner 
        as the Federal Rules of Civil Procedure prescribe for service 
        in a foreign country. To the extent that the courts of the 
        United States may assert jurisdiction over such person 
        consistent with due process, the United States District Court 
        for the District of Columbia shall have the same jurisdiction 
        to take any action respecting compliance with this section by 
        such person that such court would have if such person were 
        personally within the jurisdiction of such court.
            ``(3) Service on business persons.--Service of any such 
        subpoena may be made upon a partnership, corporation, 
        association, or other legal entity by--
                    ``(A) delivering a duly executed copy thereof to 
                any partner, executive officer, managing agent, or 
                general agent thereof, or to any agent thereof 
                authorized by appointment or by law to receive service 
                of process on behalf of such partnership, corporation, 
                association, or entity;
                    ``(B) delivering a duly executed copy thereof to 
                the principal office or place of business of the 
                partnership, corporation, association, or entity; or
                    ``(C) depositing such copy in the United States 
                mails, by registered or certified mail, return receipt 
                requested, duly addressed to such partnership, 
                corporation, association, or entity at its principal 
                office or place of business.
            ``(4) Service on natural persons.--Service of any subpoena 
        may be made upon any natural person by--
                    ``(A) delivering a duly executed copy to the person 
                to be served; or
                    ``(B) depositing such copy in the United States 
                mails, by registered or certified mail, return receipt 
                requested, duly addressed to such person at his 
                residence or principal office or place of business.
            ``(5) Verified return.--A verified return by the individual 
        serving any such subpoena setting forth the manner of such 
        service shall be proof of such service. In the case of service 
        by registered or certified mail, such return shall be 
        accompanied by the return post office receipt of delivery of 
        such subpoena.
    ``(c) Enforcement.--
            ``(1) In general.--Whenever any person, partnership, 
        corporation, association, or entity fails to comply with any 
        subpoena duly served upon him, the Postmaster General may 
        request that the Attorney General seek enforcement of the 
        subpoena in the district court of the United States for any 
        judicial district in which such person resides, is found, or 
        transacts business, and serve upon such person a petition for 
        an order of such court for the enforcement of this section.
            ``(2) Jurisdiction.--Whenever any petition is filed in any 
        district court of the United States under this section, such 
        court shall have jurisdiction to hear and determine the matter 
        so presented, and to enter such order or orders as may be 
        required to carry into effect the provisions of this section. 
        Any final order entered shall be subject to appeal under 
        section 1291 of title 28. Any disobedience of any final order 
        entered under this section by any court may be punished as 
        contempt.
    ``(d) Disclosure.--Any documentary material provided pursuant to 
any subpoena issued under this section shall be exempt from disclosure 
under section 552 of title 5.''.
    (b) Regulations.--Not later than 120 days after the date of 
enactment of this section, the Postal Service shall promulgate 
regulations setting out the procedures the Postal Service will use to 
implement the amendment made by subsection (a).
    (c) Semiannual Reports.--Section 3013 of title 39, United States 
Code, is amended by striking ``and'' at the end of paragraph (4), by 
redesignating paragraph (5) as paragraph (6), and by inserting after 
paragraph (4) the following:
            ``(5) the number of cases in which the authority described 
        in section 3016 was used, and a comprehensive statement 
        describing how that authority was used in each of those cases; 
        and''.
    (d) Technical and Conforming Amendment.--The table of sections for 
chapter 30 of title 39, United States Code, is amended by adding at the 
end the following:

``3016. Administrative subpoenas.''.

SEC. 8. REQUIREMENTS OF PROMOTERS OF SKILL CONTESTS OR SWEEPSTAKES 
              MAILINGS.

    (a) In General.--Chapter 30 of title 39, United States Code (as 
amended by section 7 of this Act) is amended by adding after section 
3016 the following:
``Sec. 3017. Nonmailable skill contests or sweepstakes matter; 
              notification to prohibit mailings
    ``(a) Definitions.--In this section--
            ``(1) the term `promoter' means any person who--
                    ``(A) originates and mails any skill contest or 
                sweepstakes, except for any matter described in section 
                3001(k)(4); or
                    ``(B) originates and causes to be mailed any skill 
                contest or sweepstakes, except for any matter described 
                in section 3001(k)(4);
            ``(2) the term `removal request' means a request stating 
        that an individual elects to have the name and address of such 
        individual excluded from any list used by a promoter for 
        mailing skill contests or sweepstakes;
            ``(3) the terms `skill contest', `sweepstakes', and 
        `clearly and conspicuously displayed' have the same meanings as 
        given them in section 3001(k); and
            ``(4) the term `duly authorized person', as used in 
        connection with an individual, means a conservator or guardian 
        of, or person granted power of attorney by, such individual.
    ``(b) Nonmailable Matter.--
            ``(1) In general.--Matter otherwise legally acceptable in 
        the mails described in paragraph (2)--
                    ``(A) is nonmailable matter;
                    ``(B) shall not be carried or delivered by mail; 
                and
                    ``(C) shall be disposed of as the Postal Service 
                directs.
            ``(2) Nonmailable matter described.--Matter described in 
        this paragraph is any matter that--
                    ``(A) is a skill contest or sweepstakes, except for 
                any matter described in section 3001(k)(4); and
                    ``(B)(i) is addressed to an individual who made an 
                election to be excluded from lists under subsection 
                (d); or
                    ``(ii) does not comply with subsection (c)(1).
    ``(c) Requirements of Promoters.--
            ``(1) Notice to individuals.--Any promoter who mails a 
        skill contest or sweepstakes shall provide with each mailing a 
        statement that--
                    ``(A) is clearly and conspicuously displayed;
                    ``(B) includes the address or toll-free telephone 
                number of the notification system established under 
                paragraph (2); and
                    ``(C) states that the notification system may be 
                used to prohibit the mailing of all skill contests or 
                sweepstakes by that promoter to such individual.
            ``(2) Notification system.--Any promoter that mails or 
        causes to be mailed a skill contest or sweepstakes shall 
        establish and maintain a notification system that provides for 
        any individual (or other duly authorized person) to notify the 
        system of the individual's election to have the name and 
        address of the individual excluded from all lists of names and 
        addresses used by that promoter to mail any skill contest or 
        sweepstakes.
    ``(d) Election To Be Excluded From Lists.--
            ``(1) In general.--An individual (or other duly authorized 
        person) may elect to exclude the name and address of that 
        individual from all lists of names and addresses used by a 
        promoter of skill contests or sweepstakes by submitting a 
        removal request to the notification system established under 
        subsection (c).
            ``(2) Response after submitting removal request to the 
        notification system.--Not later than 60 calendar days after a 
        promoter receives a removal request pursuant to an election 
        under paragraph (1), the promoter shall exclude the 
        individual's name and address from all lists of names and 
        addresses used by that promoter to select recipients for any 
        skill contest or sweepstakes.
            ``(3) Effectiveness of election.--An election under 
        paragraph (1) shall remain in effect, unless an individual (or 
        other duly authorized person) notifies the promoter in writing 
        that such individual--
                    ``(A) has changed the election; and
                    ``(B) elects to receive skill contest or 
                sweepstakes mailings from that promoter.
    ``(e) Private Right of Action.--
            ``(1) In general.--An individual who receives one or more 
        mailings in violation of subsection (d) may, if otherwise 
        permitted by the laws or rules of court of a State, bring in an 
        appropriate court of that State--
                    ``(A) an action to enjoin such violation,
                    ``(B) an action to recover for actual monetary loss 
                from such a violation, or to receive $500 in damages 
                for each such violation, whichever is greater, or
                    ``(C) both such actions.
        It shall be an affirmative defense in any action brought under 
        this subsection that the defendant has established and 
        implemented, with due care, reasonable practices and procedures 
        to effectively prevent mailings in violation of subsection (d). 
        If the court finds that the defendant willfully or knowingly 
        violated subsection (d), the court may, in its discretion, 
        increase the amount of the award to an amount equal to not more 
        than 3 times the amount available under subparagraph (B).
            ``(2) Action allowable based on other sufficient notice.--A 
        mailing sent in violation of section 3001(l) shall be 
        actionable under this subsection, but only if such an action 
        would not also be available under paragraph (1) (as a violation 
        of subsection (d)) based on the same mailing.
    ``(f) Promoter Nonliability.--A promoter shall not be subject to 
civil liability for the exclusion of an individual's name or address 
from any list maintained by that promoter for mailing skill contests or 
sweepstakes, if--
            ``(1) a removal request is received by the promoter's 
        notification system; and
            ``(2) the promoter has a good faith belief that the request 
        is from--
                    ``(A) the individual whose name and address is to 
                be excluded; or
                    ``(B) another duly authorized person.
    ``(g) Prohibition on Commercial Use of Lists.--
            ``(1) In general.--
                    ``(A) Prohibition.--No person may provide any 
                information (including the sale or rental of any name 
                or address) derived from a list described in 
                subparagraph (B) to another person for commercial use.
                    ``(B) Lists.--A list referred to under subparagraph 
                (A) is any list of names and addresses (or other 
                related information) compiled from individuals who 
                exercise an election under subsection (d).
            ``(2) Civil penalty.--Any person who violates paragraph (1) 
        shall be assessed a civil penalty by the Postal Service not to 
        exceed $2,000,000 per violation.
    ``(h) Civil Penalties.--
            ``(1) In general.--Any promoter--
                    ``(A) who recklessly mails nonmailable matter in 
                violation of subsection (b) shall be liable to the 
                United States in an amount of $10,000 per violation for 
                each mailing to an individual of nonmailable matter; or
                    ``(B) who fails to comply with the requirements of 
                subsection (c)(2) shall be liable to the United States.
            ``(2) Enforcement.--The Postal Service shall, in accordance 
        with the same procedures as set forth in section 3012(b), 
        provide for the assessment of civil penalties under this 
        section.''.
    (b) Technical and Conforming Amendments.--The table of sections for 
chapter 30 of title 39, United States Code, is amended by adding after 
the item relating to section 3016 the following:

``3017. Nonmailable skill contests or sweepstakes matter; notification 
                            to prohibit mailings.''.
    (c) Effective Date.--This section shall take effect 1 year after 
the date of enactment of this Act.

SEC. 9. STATE LAW NOT PREEMPTED.

    (a) In General.--Nothing in the provisions of this Act (including 
the amendments made by this Act) or in the regulations promulgated 
under such provisions shall be construed to preempt any provision of 
State or local law that imposes more restrictive requirements, 
regulations, damages, costs, or penalties. No determination by the 
Postal Service that any particular piece of mail or class of mail is in 
compliance with such provisions of this Act shall be construed to 
preempt any provision of State or local law.
    (b) Effect on State Court Proceedings.--Nothing contained in this 
section shall be construed to prohibit an authorized State official 
from proceeding in State court on the basis of an alleged violation of 
any general civil or criminal statute of such State or any specific 
civil or criminal statute of such State.

SEC. 10. TECHNICAL AND CONFORMING AMENDMENTS.

    (a) References to Repealed Provisions.--Section 3001(a) of title 
39, United States Code, is amended by striking ``1714,'' and ``1718,''.
    (b) Conformance With Inspector General Act of 1978.--
            (1) In general.--Section 3013 of title 39, United States 
        Code, is amended--
                    (A) by striking ``Board'' each place it appears and 
                inserting ``Inspector General'';
                    (B) in the third sentence by striking ``Each such 
                report shall be submitted within sixty days after the 
                close of the reporting period involved'' and inserting 
                ``Each such report shall be submitted within 1 month 
                (or such shorter length of time as the Inspector 
                General may specify) after the close of the reporting 
                period involved''; and
                    (C) by striking the last sentence and inserting the 
                following:
``The information in a report submitted under this section to the 
Inspector General with respect to a reporting period shall be included 
as part of the semiannual report prepared by the Inspector General 
under section 5 of the Inspector General Act of 1978 for the same 
reporting period. Nothing in this section shall be considered to permit 
or require that any report by the Postmaster General under this section 
include any information relating to activities of the Inspector 
General.''.
            (2) Effective date.--This subsection shall take effect on 
        the date of enactment of this Act, and the amendments made by 
        this subsection shall apply with respect to semiannual 
        reporting periods beginning on or after such date of enactment.
            (3) Savings provision.--For purposes of any semiannual 
        reporting period preceding the first semiannual reporting 
        period referred to in paragraph (2), the provisions of title 
        39, United States Code, shall continue to apply as if the 
        amendments made by this subsection had not been enacted.

SEC. 11. EFFECTIVE DATE.

    Except as provided in section 8 or 10(b), this Act shall take 
effect 120 days after the date of enactment of this Act.