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                            Before the
                Federal Communications Commission
                     Washington, D.C. 20554

In the Matter of                 )
                                 )
Clegg Industries, Inc.           )     File Number EB-05-ST-192  
                                 )
Torrance, California             )                   NAL/Acct. No. 
                                 ) 200632980002
                                                     FRN: 
                                   0014417414



             NOTICE OF APPARENT LIABILITY FOR FORFEITURE


                                               Released: December 
                                                         21, 2005

By the Acting District Director, Seattle District Office, Western 
Region, Enforcement Bureau:

I.   INTRODUCTION

      1.  In this Notice of Apparent Liability for Forfeiture 
 ("NAL"), we find that Clegg Industries, Inc. (``Clegg'') in 
 Torrance, California, apparently repeatedly violated Section 
 302(b) of the Commissions Act of 1934, as amended (``Act''),1  
 and Section 2.803(a)(2) of the Commission's Rules (``Rules'')2 
 by importing and marketing non-authorized radio frequency 
 devices.  We conclude, pursuant to Section 503(b) of the Act,3  
 Clegg is apparently liable for a forfeiture in the amount of 
 seven thousand dollars ($7,000).

II.  BACKGROUND

      2.  On April 10, 2005, a Western Region agent purchased a 
 ``Space Needle'' FM radio at the Space Needle gift shop in 
 Seattle, Washington.  The agent noticed that the radio lacked 
 any labeling as required by Section 15.19(a)(1) of the Rules. 4  
 The unit was turned over to the Seattle District Office for 
 further investigation.

      3.  On May 18, 2005, Seattle agents visited the Space 
 Needle gift shop and found a number of the ``Space Needle'' 
 model radios for sale.  The agents interviewed the sales 
 supervisor, and advised her that the Commission required that 
 certain labeling be placed on the devices prior to sale.  The 
 sale supervisor had the ``Space Needle'' model radios removed 
 from the shelves.

      4.  On June 16, 2005, the Seattle office issued a Letter of 
 Inquiry (``June 16, 2005 LOI'') to the Space Needle Corporation 
 requesting information about the ``Space Needle'' model radio 
 and the radios' importer.  On June 24, 2005, the Seattle office 
 received a response from the Space Needle Corporation to the 
 June 16, 2005 LOI.  The response stated that the importer of 
 the radios was Clegg Industries, Inc. located in Torrance 
 California and that they had received a shipment of the radios 
 from Clegg on March 29, 2005.  The response also indicated that 
 the Space Needle Corporation had ceased offering for sale the 
 ``Space Needle'' model radios on May 18, 2005 and had returned 
 the radios to Clegg for a refund. 

      5.  On July 15, 2005, the Seattle Office issued a Letter of 
 Inquiry (``July 15, 2005 LOI'') to Clegg requesting information 
 about the ``Space Needle'' model radios.  Specifically, the 
 Seattle Office asked when importation of the radios began, how 
 many had been imported, and whether a verification report for 
 the ``Space Needle'' model existed.  On August 8, 2005, the 
 Seattle Office received a response from Clegg to the July 15, 
 2005 LOI.  The response included a copy of the ``FCC - Test 
 Report from International Electrical Certification Centre 
 (``IECC'') Ltd.,'' which was performed at the request of the 
 manufacturer, Zonotec Industrial Co. Ltd and concluded that the 
 ``Space Needle'' model radio complied with the FCC's Part 15 
 Rules.  The verification report indicated that IECC received a 
 sample radio for testing on July 27, 2005 and conducted the 
 testing on August 2, 2005   The response also indicated that 
 Clegg Industries had issued a credit to the Space Needle 
 Corporation for the subject radios.  The response did not 
 indicate when importation of the radios began or how many of 
 the radios had been imported.


III.      DISCUSSION

      6.  Section 503(b) of the Act provides that any person who 
 willfully or repeatedly fails to comply substantially with the 
 terms and conditions of any license, or willfully or repeatedly 
 fails to comply with any of the provisions of the Act or of any 
 rule, regulation or order issued by the Commission there under, 
 shall be liable for a forfeiture penalty.  The term ``willful'' 
 as used in Section 503(b) has been interpreted to mean simply 
 that the acts or omissions are committed knowingly.5  The term 
 ``repeated'' means the commission or omission of such act more 
 than once or for more than one day.6 

      7.  Section 302(b) of the Act provides that ``[n]o person 
 shall manufacture, import, sell, offer for sale, or ship 
 devices or home electronic equipment and systems, or use 
 devices, which fail to comply with regulations promulgated 
 pursuant to this section.''7  Section 2.803(a)(2) of the Rules 
 provides that ``[e]xcept as provided elsewhere in this section, 
 no person shall sell or lease, or offer for sale or lease 
 (including advertising for sale or lease), or import, ship, or 
 distribute for the purpose of selling or leasing or offering 
 for sale or lease, any radio frequency device unless ... [i]n 
 the case of a device that is not required to have a grant of 
 equipment authorization issued by the Commission, but which 
 must comply with the specified technical standards prior to 
 use, such device also complies with all applicable 
 administrative (including verification of the equipment or 
 authorization under a Declaration of Conformity, where 
 required), technical, labeling and identification requirements 
 specified in this chapter.''8

      8.  Section 15.3(z) of the Rules9 states that FM Broadcast 
 receivers are unintentional radiators.  Section 15.101 of the 
 Rules,10 requires that unintentional radiators shall be 
 authorized prior to initiation of marketing and in the case of 
 FM Broadcast receivers, the required authorization is 
 verification.  Section 15.19(a)(1) of the Rules states that 
 receivers associated with a licensed radio service, in this 
 case, the FM Broadcast service, shall bear the following 
 statement in a conspicuous location on the device:

          ``This device complies with part 15 of the FCC Rules.  
     Operation is subject to the condition that this device does 
     not cause harmful interference.''11

      9.  The ``Space Needle'' model radios sold by the Space 
 Needle Corporation, were purchased from the importer Clegg 
 Industries Inc. in March 2005.  As the importer of the devices, 
 Clegg is deemed the responsible party, as defined in Section 
 2.909 of the Rules and, as such, is required to maintain the 
 records listed in Section 2.955 of the Rules, including the 
 testing information that demonstrates the device's compliance 
 with the verification requirements.12  Clegg's August 8, 2005 
 response to the Seattle Office's July 15, 2005 LOI included a 
 copy of a verification report for the ``Space Needle'' model 
 radio.  The verification report indicated that the testing 
 laboratory received a sample radio for testing on July 27, 2005 
 and conducted the testing on August 2, 2005, indicating that 
 the testing was performed following Clegg's receipt of the July 
 15, 2005 LOI.   

      10.   Clegg imported and marketed the ``Space Needle'' 
 model radios in March 2005, several months prior to their 
 verification.  Additionally, the units did not have the 
 required labeling.  The violation occurred on more than one 
 day, therefore, it was repeated.  Based on the evidence before 
 us, we find that Clegg apparently repeatedly violated Section 
 302(b) of the Act and Section 2.803(a)(2) of the Rules by 
 importing and marketing a non-authorized radio frequency 
 device.

      11.   Pursuant to The Commission's Forfeiture Policy 
 Statement and Amendment of Section 1.80 of the Rules to 
 Incorporate the Forfeiture Guidelines, ("Forfeiture Policy 
 Statement"), and Section 1.80 of the Rules,13 the base 
 forfeiture amount for importing or marketing unauthorized 
 equipment is $7,000.14  In assessing the monetary forfeiture 
 amount, we must also take into account the statutory factors 
 set forth in Section 503(b)(2)(D) of the Act, which include the 
 nature, circumstances, extent, and gravity of the violations, 
 and with respect to the violator, the degree of culpability, 
 and history of prior offenses, ability to pay, and other such 
 matters as justice may require.15  Applying the Forfeiture 
 Policy Statement, Section 1.80, and the statutory factors to 
 the instant case, we conclude that Clegg is apparently liable 
 for a $7,000 forfeiture.

      12.   A review of Clegg's website reveals that Clegg also 
 imports and markets at least six other models of FM receivers 
 that do not appear to have an FCC authorization.16  Therefore, 
 we will require Clegg to file a report with the Acting District 
 Director of the Seattle Office detailing, for each of the 
 models imported and marketed by Clegg, how each model complies 
 with the authorization and verification requirements of Section 
 2.803 of the Rules, and the labeling requirements of Section 
 15.19 of the Rules. 

IV.  ORDERING CLAUSES

      13.   Accordingly, IT IS ORDERED that, pursuant to Section 
 503(b) of the Communications Act of 1934, as amended, and 
 Sections 0.111, 0.311, 0.314 and 1.80 of the Commission's 
 Rules,17 Clegg Industries, Inc. is hereby NOTIFIED of this 
 APPARENT LIABILITY FOR A FORFEITURE in the amount of seven 
 thousand dollars ($7,000) for repeatedly violating Section 
 302(b) of the Act, and Section 2.803(a)(2) of the Rules.

      14.   IT IS FURTHER ORDERED that, pursuant to Section 1.80 
 of the Commission's Rules, within thirty days of the release 
 date of this Notice of Apparent Liability for Forfeiture, Clegg 
 Industries, Inc. SHALL PAY the full amount of the proposed 
 forfeiture or SHALL FILE a written statement seeking reduction 
 or cancellation of the proposed forfeiture.

      15.   IT IS FURTHER ORDERED that Clegg Industries SHALL 
 FILE, within thirty (30) days of the release of this Notice, a 
 report with the Acting District Director, Seattle Office, 
 concerning Clegg Industries Inc.'s efforts to comply with the 
 Commission's authorization, verification and labeling Rules,  
 as detailed above.

      16.      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/Acct. No. and FRN No. referenced above. Payment bycheck 
 or money order may be mailed to Federal Communications 
 Commission, P.O. Box358340,Pittsburgh, PA 15251-8340. 
 Payment by overnight mail may be sent toMellon 
 Bank/LB358340,500 Ross Street, Room 1540670, Pittsburgh, PA 
 15251. Payment by wire transfer may be made to ABA 
 Number043000261, receiving bankMellon Bank, and account 
 number911-6106.

      17.   The response, if any, must be mailed to Federal 
 Communications Commission, Enforcement Bureau, Western Region, 
 Seattle District Office, 11410 NE 122nd Way, Suite 312, 
 Kirkland, Washington 98034-6927 and must include the NAL/Acct. 
 No. referenced in the caption.
  
      18.   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 
 ("GAAP"); 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.

      19.      Requests for payment of the full amount of this 
 Notice of Apparent Liability under an installment plan should 
 be sent to: Associate Managing Director - Financial Operations, 
 Room 1A625, 445 12th Street, S.W., Washington, D.C. 20554.18





  
      20.   IT IS FURTHER ORDERED that a copy of this Notice of 
 Apparent Liability for Forfeiture shall be sent by Certified 
 Mail, Return Receipt Requested, and regular mail, Clegg 
 Industries Inc., at its address of record. 




                              FEDERAL COMMUNICATIONS COMMISSION



                              
                              Kristine A. McGowan
                              Acting District Director 
                              Seattle District Office
                              Western Region
                              Enforcement Bureau




_________________________

147 U.S.C.  302a(b).
247 C.F.R.  2.803(a)(2).
347 U.S.C.  503(b). 
447 C.F.R.  15.19(a)(1).
5Section 312(f)(1) of the Act, 47 U.S.C.  312(f)(1), which 
applies to violations for which forfeitures are assessed under 
Section 503(b) of the Act, provides that "[t]he term 'willful', 
when used with reference to the commission or omission of any 
act, means the conscious and deliberate commission or omission of 
such act, irrespective of any intent to violate any provision of 
this Act or any rule or regulation of the Commission authorized 
by this Act...."  See Southern California Broadcasting Co., 6 FCC 
Rcd 4387 (1991).
6Section 312(f)(2) of the Act, 47 U.S.C.  312(f)(2), which also 
applies to violations for which forfeitures are assessed under 
Section 503(b) of the Act, provides that "[t]he term 'repeated', 
when used with reference to the commission or omission of any 
act, means the commission or omission of such act more than once 
or, if such commission or omission is continuous, for more than 
one day.'' 
747 U.S.C.  302a(b).
847 C.F.R.  2.803(a)(2). 
947 C.F.R.  15.3(z).
10 47 C.F.R.  15.101(a).
1147 C.F.R.  15.19(a)(1).  
1247 C.F.R.  2.909, 2.955.   
1347 C.F.R.  1.80. 
1412 FCC Rcd 17087 (1997), recon. denied, 15 FCC Rcd 303 (1999); 
47 C.F.R. 1.80.
1547 U.S.C.  503(b)(2)(D).
16 See http://www.cleggonline.com/

1747 C.F.R.  0.111, 0.311, 0.314, and 1.80. 
18See 47 C.F.R.  1.1914.