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Before the
Federal Communications Commission
Washington, D.C. 20554
)
)
) File No. EB-07-SE-126
In the Matter of
) NAL/Acct. No. 200932100054
Hauppauge Computer Works, Inc.
) FRN No. 0014106520
)
)
Notice OF apparent liability for forfeiture
Adopted: April 14, 2009 Released: April 15, 2009
By the Commission:
I. introduction
1. In this Notice of Apparent Liability for Forfeiture ("NAL"), we find
Hauppauge Computer Works, Inc. ("Hauppauge") apparently liable for a
forfeiture in the amount of $175,000 for its willful and repeated
violation of Section 15.117(i)(1)(iv) of the Commission's Rules
("Rules"). These apparent violations involve Hauppauge's interstate
shipment, after March 1, 2007, of television receiving devices without
an associated viewing screen that do not comply with the Commission's
rules regarding digital television ("DTV") reception capability.
II. background
2. The All Channel Receiver Act of 1962 ("ACRA"), which is codified at
47 U.S.C. S: 303(s), states that the Commission shall "[h]ave
authority to require that apparatus designed to receive television
pictures broadcast simultaneously with sound be capable of adequately
receiving all frequencies allocated by the Commission to television
broadcasting." In advancing the intent of the ACRA, the Commission
adopted the digital television ("DTV") reception capability
requirement in 2002. The DTV reception capability requirement, which
also is often termed the "DTV tuner requirement," requires that all
new television broadcast receivers that are imported into the United
States or shipped in interstate commerce be capable of receiving the
signals of DTV broadcast stations over-the-air. The DTV tuner
requirement also applies to other video devices that include
television receivers but do not include a viewing screen. The DTV
tuner requirement was intended to facilitate the transition to digital
television by promoting the availability of DTV reception equipment
and to protect consumers by ensuring that their television receivers
will provide off-the-air television reception of digital signals just
as they have provided off-the-air television reception of analog
signals.
3. To minimize the impact of the DTV tuner requirement on both
manufacturers and consumers, the Commission adopted a phase-in
schedule that applied the requirement first to receivers with the
largest screens and then to progressively smaller screen receivers and
other television receiving devices that do not include a viewing
screen, i.e., VCRs and DVD players. This phase-in plan was intended to
allow increasing economies of scale with production volume to be
realized so that DTV tuner costs would be lower when they are required
to be included in smaller sets and other television receiving devices.
As modified by the Commission in 2005, this phase-in schedule is as
follows:
Receivers with screen sizes 36" and above -- 50% of units imported or
shipped interstate by responsible parties were required to include DTV
tuners effective July 1, 2004; 100% of such units were required to include
DTV tuners effective July 1, 2005;
Receivers with screen sizes 25" to 35" -- 50% of units imported or shipped
interstate by responsible parties were required to include DTV tuners
effective July 1, 2005; 100% of such units were required to include DTV
tuners effective March 1, 2006;
Receivers with screen sizes less than 25" - 100% of units imported or
shipped interstate by responsible parties were required to include DTV
tuners effective March 1, 2007; and
Other video devices (videocassette recorders (VCRs), digital video
recorders such as hard drive and DVD recorders, etc.) that receive
television signals - 100% of units imported or shipped interstate by
responsible parties were required to include DTV tuners effective March 1,
2007.
4. In March 2007, the Bureau received a complaint alleging that Hauppauge
was marketing in the United States, and apparently shipping
interstate, analog-only TV broadcast receiver products for personal
computers. On July 18, 2007, the Bureau issued a Letter of Inquiry
("LOI") directing Hauppauge to provide certain information regarding
certain of its devices that apparently receive analog television
signals but are not capable of receiving digital television signals.
5. In its response to the LOI, Hauppauge admitted that it imports and
sells TV boards for personal computers, some of which include both an
analog and DTV tuner and some of which include only an analog TV
tuner. Hauppauge indicated its belief that its analog-only TV boards
should not be covered under the Commission's requirements for DTV
tuners. In support of this belief, Hauppauge asserted that its
products are not stand-alone TV receivers but are components that are
added to a personal computer to provide TV capabilities; that personal
computers are "open" so an end user can add a DTV tuner at any time;
that its software is designed to support multiple TV boards in a media
personal computer; that there are some software applications which do
not yet support DTV; and that its products are designed to be added to
existing personal computer systems, some of which do not have the
technical capabilities needed to support DTV reception without the
addition of expensive hardware. Hauppauge added that it believes an
"open approach," one that allows consumers to choose how many and
which type of tuner to select for their personal computers, is the
most "consumer friendly" approach.
6. On August 28, 2007, the Bureau issued a follow-up LOI to Hauppauge,
notifying it that its response to the LOI was insufficient and
directing Hauppauge to respond fully and completely to each question
asked in the LOI within 15 business days. As of March 3, 2008,
Hauppauge had not responded to the follow-up LOI. Accordingly, the
Bureau's Spectrum Enforcement Division issued a Notice of Apparent
Liability for Forfeiture and Order ("First NAL") which proposed an
$11,000 forfeiture against Hauppauge for apparently willfully and
repeatedly violating a Commission order by failing to respond to a
directive of the Bureau to provide certain information and directed
Hauppauge to respond fully to the LOI.
7. On April 15, 2008, Hauppauge provided the information originally
requested by the first LOI. Hauppauge supplemented its response on May
6, 2008. Hauppauge acknowledges that, after March 1, 2007, it shipped
interstate 7 models of analog-only television tuner boards designed to
be installed in personal computers. Hauppauge has requested
confidentiality regarding the specific number of units shipped
interstate, its vendors, and the dates on which the units were
shipped. Although we do not rule on this confidentiality request at
this time, we will treat this information confidentially for purposes
of this NAL.
III. discussion
A. Failure to Comply with DTV Tuner Requirement
8. We conclude that Hauppauge apparently shipped in interstate commerce
television receivers that do not comply with the DTV tuner requirement
in violation of Section 15.117(i)(1)(iv) of the Rules. Section
15.117(i) applies to all "new television broadcast receivers that are
shipped in interstate commerce or imported from any foreign country
into the United States," and Section 15.117(i)(1)(iv) mandates that
other video devices that receive television signals (receivers without
associated viewing screens) "include DTV tuners effective March 1,
2007." Hauppauge acknowledges that, after March 1, 2007, it shipped
interstate 7 models of analog-only television tuner boards designed to
be installed in personal computers. Accordingly, we find that
Hauppauge apparently willfully and repeatedly shipped in interstate
commerce television receivers that do not comply with the DTV tuner
requirement in violation of Section 15.117(i)(1)(iv) of the Rules.
9. In its Supplement Response, Hauppauge reiterates its contention that
its devices are not subject to the requirements of Section 15.117.
Hauppauge states that its products are not TV sets, nor are they
similar to set-top boxes, VCRs, or DVD players which have an output to
a video monitor. Instead, Hauppauge contends that the TV tuner boards
are computer peripheral devices, or simply components of a multi-media
PC, that could not operate without being installed in a PC and
provided with additional software. Finally, Hauppauge asserts that,
even if the Commission concludes that its devices are indeed covered
under the requirements of 15.117, the Commission should not impose a
forfeiture because the company was not given reasonable notice that
the rules are applicable to such devices.
10. Hauppauge's assertion that the rules are not applicable to its devices
is erroneous. Section 15.3(w) of the Rules defines a television
broadcast receiver as "a device designed to receive television
pictures that are broadcast simultaneously with sound on the
television channels authorized under part 73 of this chapter."
Hauppauge's TV tuner boards are designed to receive television signals
which have been broadcast over-the-air in accordance with Part 73 of
the Rules. Therefore, Hauppauge's TV tuner boards for personal
computers clearly meet the definition of a television broadcast
receiver. Indeed, the advertised purpose of these tuner boards is to
enable a personal computer to receive television signals. Moreover,
while Hauppauge correctly notes that Section 15.117(i)(1)(iv)
references devices such as VCRs that typically display broadcast
signals on home entertainment sets and monitors, these examples were
meant to merely illustrate the types of devices that are intended to
receive television signals, and were not meant to be an exhaustive
list of all such devices. Indeed, Section 15.117(i)(1)(iv)
specifically includes the term "etc." at the end of the list of
examples provided under the rule. Moreover, in the DTV Tuner Second
Report and Order, the Commission made clear that any device capable of
receiving broadcast television signals off-the-air must comply with
the DTV tuner requirement. The Commission stated that "in cases where
a cell phone, PDA or similar device does include the capability to
receive TV programming on the channels allocated for the broadcast
television service, that device is a TV broadcast receiver under
Section 15.3(w) of the rules and must comply with the DTV tuner
requirements." Hauppauge's TV tuner boards likewise include the
capability to receive TV programming on the channels allocated for the
broadcast television service. Accordingly, they are TV broadcast
receivers under the definition set forth in Section 15.3(w) of the
Rules and must comply with the DTV tuner requirements.
11. In addition, we reject Hauppauge's argument that the Commission failed
to provide reasonable notice that the rules are applicable to TV tuner
boards for personal computers and similar devices. While the methods
of television transmission and reception have evolved since the ACRA
was enacted in 1962, the requirement that television receivers must
receive all available channels has not. As set forth above, the
relevant rules and rulemaking orders have made clear that all devices
capable of receiving a television broadcast signal, including TV
receiving devices without associated viewing screens, are required to
provide DTV reception.
A. Proposed Forfeiture
12. Based on the analysis set forth below, we conclude that Hauppauge is
apparently liable for a forfeiture in the amount of $175,000 for its
interstate shipment, after March 1, 2007, of television receivers that
do not comply with the DTV tuner requirement in apparent willful and
repeated violation of Section 15.117(i)(1)(iv) of the Rules.
13. Under Section 503(b)(1)(B) of the Act, any person who is determined by
the Commission to have willfully or repeatedly failed to comply with
any provision of the Act or any rule, regulation, or order issued by
the Commission shall be liable to the United States for a forfeiture
penalty. To impose such a forfeiture penalty, the Commission must
issue a notice of apparent liability and the person against whom such
notice has been issued must have an opportunity to show, in writing,
why no such forfeiture penalty should be imposed. The Commission will
then issue a forfeiture if it finds by a preponderance of the evidence
that the person has violated the Act or a Commission rule.
14. At the time of Hauppauge's apparent violations, Section 503(b)(2)(D)
of the Act authorized the Commission to assess an entity that is
neither a common carrier, broadcast licensee or cable operator a
forfeiture of up to $11,000 for each violation or each day of a
continuing violation, up to a statutory maximum forfeiture of $97,500
for any single continuing violation. In exercising such authority, we
are required to take into account "the nature, circumstances, extent,
and gravity of the violation and, with respect to the violator, the
degree of culpability, any history of prior offenses, ability to pay,
and such other matters as justice may require."
15. The Commission's Forfeiture Policy Statement and Section 1.80 of the
Rules do not establish a specific base forfeiture for violation of the
DTV tuner requirement. The Commission has substantial discretion,
however, in proposing forfeitures. We may apply the base forfeiture
amounts described in the Forfeiture Policy Statement and our rules, or
we may depart from them altogether as the circumstances demand.
16. The DTV tuner requirement promotes the important public policy goal of
helping to speed the transition to digital television, and we
therefore have found violations of this requirement to be more
egregious, in general, than many other types of equipment marketing
cases that come before us. DTV receivers are a necessary element of
digital broadcast television service. Consumers must have the
capability to receive DTV signals for the DTV transition to move
forward to successful completion. The DTV tuner requirement is
intended to protect consumers by ensuring that their TV receivers will
provide over-the-air TV reception of digital signals when analog TV
operation ceases. In recent cases involving violations of the DTV
tuner requirement, we found that applying a proposed forfeiture on a
per model basis, as we have in other more routine equipment marketing
cases, would result in forfeiture amounts that are not commensurate
with the seriousness of the violation, and thus, we proposed a
forfeiture based on each noncompliant unit shipped interstate or
imported.
17. Nevertheless, we conclude that violations of the DTV tuner requirement
involving television receivers without an associated viewing screen,
while serious, are not as egregious as violations of the DTV tuner
requirement involving television receivers with an associated viewing
screen. Significantly, television receivers with an associated viewing
screen are likely to be used by consumers as the primary television
viewing device, while television receivers without an associated
viewing screen, such as the relatively inexpensive Hauppauge TV tuner
boards, are more likely to be used as a secondary or tertiary
television viewing alternative. Thus, while we conclude that Hauppauge
has apparently shipped interstate television receivers without DTV
tuners in violation of Section 15.117(i)(1)(iv), we believe that the
tiered forfeiture approach outlined above would be excessively
punitive, given the nature of the violations. Therefore, we will
assess the present forfeiture on a per model basis as we have in other
equipment marketing cases.
18. As noted above, in this case we may propose a forfeiture of up to
$11,000 for each violation or each day of a continuing violation, up
to a statutory maximum forfeiture of $97,500 for any single continuing
violation. In view of the important public policy considerations
underlying the DTV tuner requirement for television receivers without
an associated viewing screen, we conclude that, generally, the
appropriate per model forfeiture amount in such cases will be $25,000.
We find that calculating forfeitures for violations of the DTV tuner
requirement involving television receivers without an associated
viewing screen on a per model basis will result in forfeiture amounts
that reflect the seriousness of the violations and will deter future
misconduct.
19. Applying the forfeiture calculation methodology outlined above, we
propose a forfeiture of $175,000 (7 models * $25,000/model) for
Hauppauge's willful and repeated interstate shipment of television
receivers without an associated viewing screen that do not comply with
the DTV tuner requirement in violation of Section 15.117(i)(1)(iv) of
the Rules.
IV. ordering clauses
20. Accordingly, IT IS ORDERED that, pursuant to Section 503(b) of the
Act, and Section 1.80 of the Rules, Hauppauge Computer Works, Inc. is
NOTIFIED of its APPARENT LIABILITY FOR A FORFEITURE in the amount of
one hundred seventy-five thousand dollars ($175,000) for willful and
repeated violation of Section 15.117(i)(1)(iv) of the Rules.
21. IT IS FURTHER ORDERED that, pursuant to Section 1.80 of the Rules,
within thirty days of the release date of this Notice of Apparent
Liability for Forfeiture, Hauppauge Computer Works, Inc. SHALL PAY the
full amount of the proposed forfeiture or SHALL FILE a written
statement seeking reduction or cancellation of the proposed
forfeiture.
22. Payment of the forfeiture must be made by check or similar instrument,
payable to the order of the Federal Communications Commission. The
payment must include the NAL/Account Number and FRN Number referenced
above. Payment by check or money order may be mailed to Federal
Communications Commission, P.O. Box 979088, St. Louis, MO 63197-9000.
Payment by overnight mail may be sent to U.S. Bank - Government
Lockbox #979088, SL-MO-C2-GL, 1005 Convention Plaza, St. Louis, MO
63101. Payment by wire transfer may be made to ABA Number 021030004,
receiving bank TREAS/NYC, and account number 27000001. For payment by
credit card, an FCC Form 159 (Remittance Advice) must be submitted.
When completing the FCC Form 159, enter the NAL/Account number in
block number 23A (call sign/other ID), and enter the letters "FORF" in
block number 24A (payment type code). Requests for full payment under
an installment plan should be sent to: Chief Financial Officer --
Financial Operations, 445 12th Street, S.W., Room 1-A625, Washington,
D.C. 20554. Please contact the Financial Operations Group Help Desk
at 1-877-480-3201 or Email: ARINQUIRIES@fcc.gov with any questions
regarding payment procedures. Hauppauge will also send an electronic
notification on the date said payment is made to Neal.McNeil@fcc.gov
and Kathy.Berthot@fcc.gov.
23. The response, if any, must be mailed to the Office of the Secretary,
Federal Communications Commission, 445 12th Street, S.W., Washington,
D.C. 20554, ATTN: Enforcement Bureau - Spectrum Enforcement Division,
and must include the NAL/Acct. No. referenced in the caption.
24. The Commission will not consider reducing or canceling a forfeiture in
response to a claim of inability to pay unless the petitioner submits:
(1) federal tax returns for the most recent three-year period; (2)
financial statements prepared according to generally accepted
accounting practices; or (3) some other reliable and objective
documentation that accurately reflects the petitioner's current
financial status. Any claim of inability to pay must specifically
identify the basis for the claim by reference to the financial
documentation submitted.
25. IT IS FURTHER ORDERED that a copy of this Notice of Apparent
Liability for Forfeiture shall be sent by first class mail and
certified mail return receipt requested to Mr. Ken Plotkin, President
and CEO, Hauppauge Computer Works, Inc., 91 Cabot Court, Hauppauge,
NY, 11788, and to Norman Leventhal, Esq., Holland & Knight, 2099
Pennsylvania Avenue, N.W., Suite 100, Washington, DC 20006.
FEDERAL COMMUNICATIONS COMMISSION
Marlene H. Dortch
Secretary
47 C.F.R. S: 15.117(i)(1)(iv).
P.L. No. 87-529, 76 Stat. 150.
Review of the Commission's Rules and Policies Affecting the Conversion to
Digital Television, Second Report and Order and Second Memorandum Opinion
and Order, 17 FCC Rcd 15978, 15996 (2002) ("DTV Review Second Report and
Order").
See 47 C.F.R. S: 15.3(w) (defining a television broadcast receiver as "a
device designed to receive television pictures that are broadcast
simultaneously with sound on the television channels authorized under part
73 of this chapter").
DTV Review Second Report and Order, 17 FCC Rcd at 15996.
See 47 C.F.R. S: 15.117(i)(1)(iv).
Id. at 15998-99.
Id.
In June 2005, the Commission modified the rules to advance the date on
which 100% of new television receivers with screen sizes 25-36" that are
imported or shipped interstate must include DTV tuners from July 1, 2006
to March 1, 2006. DTV Tuner Report and Order, 20 FCC Rcd at 11203.
Subsequently, in November 2005, the Commission modified the rules to
advance the date on which 100% of new television receivers with screen
sizes 13-24" and certain other television receiving devices such as VCRs
and digital video recorders that are imported or shipped interstate must
include DTV tuners from July 1, 2007 to March 1, 2007. See Requirements
for Digital Television Receiving Capability, Second Report and Order, 20
FCC Rcd 18607, 18614-16 (2005) ("DTV Tuner Second Report and Order"). The
Commission also amended the rules to apply the DTV tuner requirement to
new receivers with screen sizes smaller than 13" on this same schedule.
Id.
The DTV tuner requirement applies to "responsible parties," as defined in
Section 2.909 of the Rules, 47 C.F.R. S: 2.909.
See Letter from Kathryn S. Berthot, Chief, Spectrum Enforcement Division,
Enforcement Bureau, to Hauppauge Computer Works, Inc. (July 18, 2007)
("LOI").
As the importer of the television tuner boards, Hauppauge is the party
responsible for compliance of those cards with all applicable technical
and administrative requirements. See 47 C.F.R S: 2.909(b).
See Letter from Ken Plotkin, President and CEO, Hauppauge Computer Works,
Inc., to Neal McNeil, Spectrum Enforcement Division, Enforcement Bureau
(August 15, 2007) at 1.
Id.
Id. at 1 - 2.
Id. at 2.
See Letter from Kathryn S. Berthot, Chief, Spectrum Enforcement Division,
Enforcement Bureau, to Ken Plotkin, Chief Executive Officer, Hauppauge
Computer Works, Inc. (August 28, 2007) ("Follow-up LOI").
See Hauppauge Computer Works, Inc., Notice of Apparent Liability for
Forfeiture and Order, 23 FCC Rcd. 3684 (Enf. Bur., Spectrum Enf. Div.,
2008) (forfeiture paid).
See Letter from Ken Plotkin, President and Chief Operation Officer,
Hauppauge Computer Works, Inc. to Marlene H. Dortch, Secretary, Federal
Communications Commission (April 15, 2008) ("Second LOI Response").
See Letter from Norman P. Leventhal to Marlene H. Dortch, Secretary,
Federal Communications Commission (May 6, 2008) ("Supplemental Response").
Specifically, Hauppauge acknowledges that, after March 1, 2007, it shipped
interstate the following 7 models: Win TV Go Plus, Win TV USB2, Win TV PVR
150, Win TV PVR 250, Win TV PVR 350, Win TV PVR 500 MCE, Win TV PVR USB2.
Second LOI Response at 3- 67. Hauppauge also acknowledges shipping several
other models which are identical to models listed above.
Second LOI Response at 1.
47 C.F.R. S: 15.117(i)(1)(iv).
On April 29, 2008, Hauppauge and the Enforcement Bureau executed a Tolling
Agreement tolling the one-year statute of limitations set forth in Section
503(b)(6) of the Act in order to permit settlement discussions. Tolling
Agreement, File No. EB-07-SE-126, executed by and between Kathryn Berthot,
Chief, Spectrum Enforcement Division, Enforcement Bureau, Federal
Communications Commission, and Ken Plotkin, CEO, Hauppauge Computer Works,
Inc. (April 29, 2008). Hauppauge and the Bureau extended the Tolling
Agreement on July 9, 2008, October 8, 2008, and January 13, 2009. Tolling
Agreement Extensions, File No. EB-07-SE-126, executed by and between
Kathryn Berthot, Chief, Spectrum Enforcement Division, Enforcement Bureau,
Federal Communications Commission, and Ken Plotkin, CEO, Hauppauge
Computer Works, Inc. (July 9, 2008, October 8, 2008, and January 13,
2009). Hauppauge and the Bureau were subsequently unable to reach a
settlement agreement. Thus, this NAL includes a number of violations that
occurred more than a year ago, but which remain subject to forfeiture
pursuant to the Tolling Agreement and Tolling Agreement Extensions, the
last of which expires on April 15, 2009.
Section 312(f)(1) of the Act defines "willful" as "the conscious and
deliberate commission or omission of [any] act, irrespective of any intent
to violate" the law. 47 U.S.C. S: 312(f)(1). The legislative history of
Section 312(f)(1) of the Act clarifies that this definition of willful
applies to both Sections 312 and 503(b) of the Act, H.R. Rep. No. 97-765,
97th Cong. 2d Sess. 51 (1982), and the Commission has so interpreted the
term in the Section 503(b) context. See Southern California Broadcasting
Co., Memorandum Opinion and Order, 6 FCC Rcd 4387, 4388 (1991), recon.
denied, 7 FCC Rcd 3454 (1992) ("Southern California").
Section 312(f)(2) of the Act, which also applies to forfeitures assessed
pursuant to Section 503(b) of the Act, provides that "[t]he term
`repeated,'... means the commission or omission of such act more than once
or, if such commission or omission is continuous, for more than one day."
47 U.S.C. S: 312(f)(2). See Callais Cablevision, Inc., Notice of Apparent
Liability for Forfeiture, 16 FCC Rcd 1359, 1362 (2001); Southern
California, 6 FCC Rcd at 4388.
Supplemental Response at 7, 11.
Id.
Id. at 8.
Id. at 17-18.
47 C.F.R. S: 15.3(w).
47 C.F.R. Part 73 - Radio Broadcast Services.
In its Second LOI Response, Hauppauge states that, "A user of our TV tuner
boards can install a mix of our analog and digital TV tuners in a personal
computer to make a television receiver with multiple analog and digital
tuners." Second LOI Response at 2.
47 C.F.R. S: 15.117(i)(1)(iv).
20 FCC Rcd at 18616.
Id.
47 U.S.C. S: 503(b)(1)(B); 47 C.F.R. S: 1.80(a)(1).
47 U.S.C. S: 503(b); 47 C.F.R. S: 1.80(f).
See, e.g., SBC Communications, Inc., Forfeiture Order, 17 FCC Rcd 7589,
7591 (2002).
47 U.S.C. S: 503(b)(2)(D). The Commission has amended Section 1.80(b)(3)
of the Rules, 47 C.F.R. S: 1.80(b)(3), three times to increase the maximum
forfeiture amounts, in accordance with the inflation adjustment
requirements contained in the Debt Collection Improvement Act of 1996, 28
U.S.C. S: 2461. See Amendment of Section 1.80 of the Commission's Rules
and Adjustment of Forfeiture Maxima to Reflect Inflation, 23 FCC Rcd 9845
(2008) (adjusting the maximum statutory amounts from $11,000/$97,500 to
$16,000/$112,500); Amendment of Section 1.80 of the Commission's Rules and
Adjustment of Forfeiture Maxima to Reflect Inflation, Order, 19 FCC Rcd
10945 (2004) (adjusting the maximum statutory amounts from $11,000/$87,500
to $11,000/$97,500); Amendment of Section 1.80 of the Commission's Rules
and Adjustment of Forfeiture Maxima to Reflect Inflation, Order, 15 FCC
Rcd 18221 (2000) (adjusting the maximum statutory amounts from
$10,000/$75,000 to $11,000/$87,500). The most recent inflation adjustment
took effect September 2, 2008 and applies to violations that occurred
after that date. See 73 Fed. Reg. 44663-5.
47 U.S.C. S: 503(b)(2)(E). See also 47 C.F.R. S: 1.80(b)(4), Note to
paragraph (b)(4): Section II. Adjustment Criteria for Section 503
Forfeitures.
See The Commission's Forfeiture Policy Statement and Amendment of Section
1.80 of the Rules to Incorporate the Forfeiture Guidelines, Report and
Order, 12 FCC Rcd 17087, 17115 (1997), recon. denied, 15 FCC Rcd 303
(1999) ("Forfeiture Policy Statement").
See, e.g., InPhonic, Inc., Order of Forfeiture and Further Notice of
Apparent Liability, 22 FCC Rcd 8689, 8699 (2007); Globcom, Inc. d/b/a
Globcom Global Commun., Order of Forfeiture, 21 FCC Rcd 4710, 4723-24
(2006).
See 47 C.F.R. S:1.80(b)(4) ("The Commission and its staff may use these
guidelines in particular cases [, and] retain the discretion to issue a
higher or lower forfeiture than provided in the guidelines, to issue no
forfeiture at all, or to apply alternative or additional sanctions as
permitted by the statute.") (emphasis added).
Syntax-Brillian Corporation, Notice of Apparent Liability for Forfeiture,
22 FCC Rcd 10530, 10535 (2007), forfeiture ordered, 23 FCC Rcd 6323
(2008) ("Syntax-Brillian NAL"); Regent U.S.A., Inc., 22 FCC Rcd 10520
(2007) (forfeiture paid) ("Regent NAL").
See DTV Tuner Report and Order, 20 FCC Rcd at 11199; DTV Tuner Second
Report and Order, 20 FCC Rcd at 18608.
See id.
See Syntax-Brillian NAL, 22 FCC Rcd at 10535-36 (concluding that applying
a proposed forfeiture on a per-model basis for shipment of television
receivers that were not compliant with the DTV tuner mandate would result
in forfeiture amounts incommensurate with the seriousness of the
violations); Regent NAL, 22 FCC Rcd at 10525-26 (same). To reflect the
increasing seriousness of the violation as the number of non-compliant
units shipped or imported rises, we assessed forfeiture amounts on a
tier-by-tier basis, increasing the forfeiture amount as the number of
units shipped or imported increased. See e.g., Syntax-Brillian NAL, 22 FCC
Rcd 10535-36 (Tiers and per-unit forfeiture amounts were: 0-1000 units:
$50 per unit, 1001-2500 units: $75 per unit, 2501-5000 units: $100 per
unit, 5001-10000 units: $125 per unit, 10001-20000 units: $150 per unit,
20001-30000 units: $175 per unit, 30001-40000 units: $200 per unit,
40001-50000: $225 per unit, and 50001+ units: $250 per unit.).
Cf. Polaroid Corporation, Notice of Apparent Liability for Forfeiture, 23
FCC Rcd 6346, 6350 (2008) ("Polaroid NAL") (forfeiture paid); Proview
Technology, Inc. and Proview Technology (Shenzhen), Ltd., Notice of
Apparent Liability for Forfeiture, 23 FCC Rcd 6353, 6357 (2008) ("Proview
NAL") (forfeiture paid) (both concluding that that violations of the
requirement to ensure that digital television receivers have the
capability to respond to changes in the content advisory rating system,
while very serious, are not as egregious as violations of the DTV tuner
requirement or violations involving the failure to provide any V-Chip
blocking capability).
Because each non-compliant unit shipped interstate is a separate
violation, we could impose a far higher forfeiture than $25,000 for each
model. As noted above, however, because of the circumstances of this rule
and these violations, we consider $25,000 per model to be sufficient. We
have used a $25,000 per model approach in other contexts. Specifically, in
Polaroid and Proview, we established a $25,000 per model forfeiture
approach for the interstate shipment of DTV receivers that do not comply
with the Commission's rules requiring that such receivers have the
capability to respond to changes in the content advisory rating system.
Polaroid NAL, 23 FCC Rcd at 6350; Proview NAL, 23 FCC Rcd at 6358. See
also AboCom Systems, Inc., Notice of Apparent Liability for Forfeiture, 21
FCC Rcd 7875, 7878-79 (Enf. Bur. Spectrum Enf. Div. 2006), forfeiture
ordered, 21 FCC Rcd 13140 (Enf. Bur. Spectrum Enf. Div. 2006), recon.
denied, 22 FCC Rcd 7448 (Enf. Bur. 2007) (proposing a $25,000 forfeiture
against an equipment manufacturer for marketing one model of radio
frequency equipment that did not comply with the terms of its equipment
authorization and technical requirements specified in the rules).
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Federal Communications Commission FCC 09-34
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Federal Communications Commission FCC 09-34