******************************************************** NOTICE ******************************************************** This document was converted from WordPerfect or Word to ASCII Text format. Content from the original version of the document such as headers, footers, footnotes, endnotes, graphics, and page numbers will not show up in this text version. All text attributes such as bold, italic, underlining, etc. from the original document will not show up in this text version. Features of the original document layout such as columns, tables, line and letter spacing, pagination, and margins will not be preserved in the text version. If you need the complete document, download the Word or WordPerfect version or Adobe Acrobat version, if available. ***************************************************************** Before the FEDERAL COMMUNICATIONS COMMISSION Washington, D.C. 20554 In the Matter of ) ) File No. EB-00-TS-032; SouthEast Telephone, Inc. ) NAL/Acct. No. X3210-001 ) ) CONSENT DECREE 1. The Enforcement Bureau ("Bureau") of the Federal Communications Commission ("Commission'' or ``FCC"), and SouthEast Telephone, Inc. ("South?East"), hereby enter into this voluntary Consent Decree resolving possible violations of Section 301 of the Communications Act of 1934, as amended, 47 U.S.C. § 301, and the Commission's policies and rules regarding the operation of Broad?band Personal Communications Service ("PCS") facilities (the ``Inquiry''). 2. For purposes of this Consent Decree the following definitions apply: 2.a. "Commission" or "FCC" means the Federal Communications Commission; 2.b. "Bureau" means the FCC's Enforcement Bureau; 2.c. "SouthEast" means SouthEast Telephone, Inc., its successors and assigns; 2.d. "Parties" means SouthEast and the Bureau; 2.e. "Adopting Order" means an Order of the Bureau adopting the terms and conditions of this Consent Decree; 2.f. ``Act'' means the Communications Act of 1934, as amended, 47 U.S.C. §§ 151 et seq; 2.g. ``Rules'' means the rules adopted by the Commission pursuant to the Act; 2.h. ``NAL'' means the Notice of Apparent Liability issued by the Bureau on February 22, 2000, DA 00-325, holding SouthEast apparently liable for a forfeiture in the amount of $100,000 for alleged violations of Section 301 of the Act and Section 24.803 of the Rules. 3. The Parties agree that the provisions of this voluntary Consent Decree shall be subject to final approval by the Bureau by incorporation of such provisions by reference into an Adopting Order of the Bureau. 4. The Parties agree that this Consent Decree shall become effective on the date on which the Bureau releases the Adopting Order. Upon release, the Adopting Order and this Consent Decree shall have the same force and effect as any other Order of the Commission, and any violation of the terms of this Consent Decree shall constitute a violation of a Commission Order entitling the Commission to exercise any and all rights and to seek any and all remedies authorized by law for the enforcement of a Commission Order. 5. SouthEast admits the jurisdiction of the Commission for purposes of this Consent Decree and the Adopting Order. 6. SouthEast waives any rights that it may have to further procedural steps and any rights it may have to seek judicial review or otherwise challenge or contest the validity of the Adopting Order or this Consent Decree. 7. SouthEast waives any rights it may have under any provision of the Equal Access to Justice Act, 5 U.S.C. § 504. Statement of Facts 8. SouthEast was the winning bidder for six C-Block PCS licenses that the Commission auctioned in 1996. SouthEast timely made its initial payments and was granted six licenses, for which SouthEast immediately sought financing for construction. 9. In October 1998, SouthEast completed construction and commenced operation of the one PCS station for which it was able to secure financing, the B474C license in the Williamsburg, West Virginia-Pikeville Kentucky Basic Trading Area (``Pikeville BTA''). 10. On October 26, 1998, SouthEast filed an emergency petition with the FCC seeking a temporary waiver of Section 1.2110(f)(4)(iii) of the Rules, which would allow SouthEast until December 31, 1998, to make its first interest-only installment payment on its six PCS licenses, which was otherwise due to be paid to the Commission on October 29, 1998. 11. On October 29, 1998, the Commission denied SouthEast's emergency waiver petition, which under the Rules caused SouthEast's PCS licenses to cancel automatically and revert to the Commission unless otherwise stayed. SouthEast expeditiously sought administrative and judicial relief from the automatic cancellation of its licenses, including timely filing a petition for reconsideration and request for stay with the FCC. SouthEast continued to operate its PCS station in the Pikeville BTA pending the judicial and administrative appeals. 12. On November 12, 1998, the Wireless Telecommu?nications Bureau announced that it would hold a re-auction of PCS spectrum, ultimately scheduled to begin on March 23, 1999, that was to include SouthEast's PCS licenses. On November 20, 1998, SouthEast petitioned the D.C. Circuit to stay the planned re- auction but was ultimately denied. On March 11, 1999, South?East filed a petition requesting that the Commission stay the upcoming auction or, in the alternative, withdraw SouthEast's contested licenses therefrom. 13. On April 2, 1999, the Commission denied SouthEast's outstanding petition for reconsideration and request for stay of the October 29, 1998 order, as well as SouthEast's request for stay of the C-Block re-auction. 14. On April 14, 1999, SouthEast requested special temporary authority ("STA") from the Commission for 180 days to continue operating its PCS facilities in the Pikeville BTA. 15. On April 29, 1999, a staff member of the Wireless Telecommunications Bureau spoke with SouthEast's counsel about its STA application and requested additional information about SouthEast's PCS operations. SouthEast responded to the Wireless Bureau's inquiry regarding the STA application, at which time South?East stated that it had commenced operation of its PCS facilities in the Pikeville BTA in October of 1998, and as of April 30, 1999, it was still operating and serving 137 subscribers. 16. On April 30, 1999, SouthEast filed a petition for review of the Commission's April 2, 1999, Order with the D.C. Circuit, which the court denied on November 24, 1999. 17. On September 29, 1999, the Wireless Bureau granted a license for the Pikeville BTA to ComScape Communications, Inc. (``ComScape''), the winning bidder for the license at the C-Block re-auction. On October 8, 1999, ComScape filed an informal complaint with the FCC citing SouthEast's continued operation of PCS facilities in the Pikeville BTA. 18. On October 29, 1999, the Wireless Bureau asked SouthEast to respond to ComScape's informal complaint. On November 22, 1999, SouthEast responded, confirming its continued operation of PCS facilities in the Pikeville BTA, but noting that it had not marketed or publicized that service or otherwise attempted to increase the customer base. 19. On February 22, 2000, the Wireless Bureau granted SouthEast's STA request for the lesser of 180 days or 10 days after ComScape notifies SouthEast that ComScape has commenced operations in the Pikeville BTA. Also on February 22, 2000, the Enforcement Bureau issued the NAL citing SouthEast for its operation of PCS facilities in the Pikeville BTA between February 22, 1999 (the earliest date to which penalties could relate back), and November 22, 1999. Terms of Settlement 20. The Parties agree that this Consent Decree is for settlement purposes only and that SouthEast does not admit any alleged violation or liability for the specific acts described in the NAL or in any informal or formal complaints received by the Commission on or before the effective date of this Consent Decree. 21. SouthEast shall make a voluntary contribution to the United States Treasury in the amount of forty thousand dollars ($40,000) as follows: twenty thousand dollars ($20,000) of the contribution shall be paid within ten (10) days of the effective date of the Adopting Order, and five (5) payments of four thousand dollars ($4,000) each shall be made, respectively, sixty (60), ninety (90), one hundred twenty (120), one hundred fifty (150) and one hundred eighty (180) days after the effective date of the Adopting Order. All contributions shall be made without further protest or recourse, by certified check, cashier's check or money order drawn to the order of the Federal Communications Commission, and shall be mailed to the Federal Communications Commission, P.O. Box 73482, Chicago, Illinois 60673-7482, reflecting account number X3210-001. 22. SouthEast agrees that it will increase education and training of all its employees with respect to compliance with the Act and the Commission's Rules, as follows: 22.a. SouthEast shall implement a formal, comprehensive compliance program (``Compliance Program'') for the education of all officers, employees, contractors, and any other persons or entities associated with SouthEast who have or will have responsibilities for ensuring SouthEast's compliance with the Act and the Rules. The purpose of the Compliance Program shall be to ensure future compliance by SouthEast with all applicable provisions of the Act, and the FCC's Rules, regulations and policies, and prompt reporting of violations thereof. SouthEast may at its own discretion terminate the Compliance Program after the expiration of the term of this Consent Decree; 22.b. SouthEast shall appoint a Compliance Program Administrator (``Administrator'') who shall establish and maintain a monitoring and evaluation program to oversee mandatory participation in the Compliance Program prior to the assumption of any FCC-related duties by SouthEast personnel. The Administrator shall require written certification from SouthEast personnel with FCC-related responsibilities that each has read, understands and agrees to abide by the terms of this Consent Decree and the Compliance Program. The Administrator shall further maintain auditable records and shall produce such records within ten (10) calendar days upon written request of the Commission or the Bureau; and 22.c. SouthEast agrees to provide a summary of relevant portions of its revised training materials to the Bureau reflecting implementation of the Compliance Program within ninety (90) days of the effective date of the Adoption Order. 23. SouthEast agrees that it shall notify the Chief, Enforcement Bureau, Federal Communications Commission, Washington, D.C. 20554, at least thirty (30) days prior to the effective date of any material change in SouthEast's legal status, or corporate structure that may materially affect its obligations hereunder, including but not limited to, merger, incorporation, dissolution, assignment, or any other changes that may materially affect South?East's obligations under this Consent Decree. Nothing in this Consent Decree shall be deemed to be an obligation on SouthEast to disclose "material inside informa?tion" as that term is defined in applicable securities law and regulations. 24. The Parties agree and acknowledge that this Consent Decree shall constitute a final settlement of the Inquiry, and in light of the covenants and representations contained in this Consent Decree, and in express reliance thereon, and in order to avoid litigation costs, the Bureau agrees to terminate same. Such termination is without a finding by the Commission or the Bureau of wrongdoing by SouthEast. The Bureau will not initiate on its own motion any other enforcement action against SouthEast, or seek on its own motion any administrative or other penalties from SouthEast based on the allegations in the NAL. In addition, in the absence of additional facts, the Bureau agrees that it will not use the allegations and other circumstances set forth in the NAL and involved in this proceeding against SouthEast with respect to its basic qualifications to be a licensee in any current or future proceeding. 25. The Parties agree that the terms and conditions of this Consent Decree shall remain in effect for one year from the effective date of the Adopting Order. The Par?ties also agree that any provision of the Consent Decree, except for that relating to the Consent Decree constituting a final settlement of the Inquiry hereby disposed, which conflicts with any subsequent rule or order adopted by the Commission, will be superseded by such Commission rule or order. 26. If this Consent Decree is not signed by both parties, is not adopted by the Bureau, or is otherwise rendered invalid by any court of competent jurisdiction, it shall become null and void and shall not become part of the record in these enforcement proceedings, nor used in any fashion by any party in a legal proceeding. The parties agree, however, that except as otherwise ordered by any court of competent jurisdiction, the parties will comply with this Consent Decree during the pendency of any proceeding initiated by a third party seeking to nullify, void or otherwise modify the Consent Decree or the Adopting Order. 27. The parties further agree that this Consent Decree shall become effective on the date of the release of the Adopting Order. 28. This Consent Decree may be signed in counterparts. FOR THE ENFORCEMENT BUREAU, FOR SOUTHEAST FEDERAL COMMUNICATIONS TELEPHONE, INC. COMMISSION ___________________________________ ______________________________ David H. Solomon Darrell Maynard Chief, Enforcement Bureau President Federal Communications Commission SouthEast Telephone, Inc.