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

In the Matter of                )
                                )       File No. EB-01-MA-040
New Image Electronics           )    
Miami, Florida                  )       NAL/Acct.             No. 

200232700003
                               )     
                                )       FRN 0006-3343-12
                               ) 

                        FORFEITURE ORDER

     Adopted:  February 26, 2002        Released:  March 1, 2002        

By the Chief, Enforcement Bureau:

                        I.  INTRODUCTION

     1.   In  this  Forfeiture  Order  (``Order''),  we  issue  a 
monetary forfeiture  in  the  amount of  seven  thousand  dollars 
($7,000),  to  New  Image  Electronics  (``NIE''),  for   willful 
violation of Section 302(b) of the Communications Act of 1934, as 
amended (``Act''),1 and Section  2.803(a)(1) of the  Commission's 
Rules ("Rules").2  The noted  violation involves NIE's  marketing 
of non-compliant long-range cordless telephones.

     2.   On October  29,  2001,  the District  Director  of  the 
Commission's Tampa,  Florida  Field  Office issued  a  Notice  of 
Apparent Liability  for Forfeiture  ("NAL"),3  on behalf  of  the 
Commission's  Miami,  Florida   Resident  Agent  Office   ("Miami 
Office"), in the amount of seven thousand dollars ($7,000).   NIE 
filed a response on January 14, 2002.

                         II.  BACKGROUND

     3.   In   February   of    2001,   the   Federal    Aviation 
Administration ("FAA") reported to the Enforcement Bureau that it 
was receiving sporadic interference  to an aviation frequency  in 
the Miami,  Florida area.   In March  of 2001,  the Miami  Office 
identified  the  source  of  the  interference  as  a  long-range 
cordless telephone being  operated from an  electronics store  in 
Miami.  Information  subsequently  obtained  by  the  Enforcement 
Bureau indicated that  some long-range  cordless telephones  were 
being marketed for use on civilian VHF aviation frequencies in  a 
number of  states.  The  FAA provided  technical measurements  of 
some of  the long-range  cordless telephones  and indicated  that 
some of  the units  transmitted significant  spurious signals  on 
aviation frequencies, while other  units were purposely  designed 
to operate  in the  aviation  band.  As  a  result of  the  FAA's 
concerns,  the   Enforcement   Bureau   launched   a   nationwide 
investigation  into  the  unlawful  use  of  long-range  cordless 
telephones that has resulted in the issuance of several citations 
and NALs.  The  cordless telephone  purchased by  the FCC  agents 
from NIE  is  the  same  type  of  unlawful  long-range  cordless 
telephone that  caused  concern  for the  FAA.   This  long-range 
cordless  telephone   had   the  potential   to   cause   serious 
interference to aviation and, thus, is a threat to public safety.   

     4.   On July 27, 2001, agents from the Miami Office  visited 
NIE, a  retail store  located at  9 West  Flagler Street,  Miami, 
Florida 33130.   The agents  inquired about  the availability  of 
long-range, cordless  telephones for  purchase.  The  salesperson 
offered several models  for sale,  including a  Prolink, CT  600.  
The long-range  cordless  telephones  offered for  sale  did  not 
possess  the  FCC  authorization  required  for  marketing  these 
devices in  the United  States.  On  August 24,  2001, the  Miami 
Office issued a citation to  NIE for violation of Section  302(b) 
of the Act and Section  2.803(a)(1) of the Rules which  prohibits 
the marketing  of  such  devices.  On  September  10,  2001,  NIE 
responded to the citation.  In its response, NIE stated that  the 
offending cordless telephones were no longer in the store.  

     5.   On September 27, 2001, two  FCC agents returned to  NIE 
and again inquired about the availability of long-range  cordless 
telephones for  purchase.   The  salesperson sold  the  agents  a 
Prolink, CT 600.  The cordless telephone purchased by the  agents 
did not possess  the labeling or  FCC authorization required  for 
marketing the device in the United States.4  On October 29, 2001, 
the District Director  of the Commission's  Tampa, Florida  Field 
Office issued a NAL  to NIE for  marketing a non-compliant  high-
power cordless telephone  in violation of  Section 302(b) of  the 
Act and Section 2.803(a)(1) of  the Rules.  On January 14,  2002, 
the Bureau received a response to the NAL.  In its response,  NIE 
does  not  dispute   the  violations.    However,  NIE   requests 
cancellation or reduction  of the forfeiture  for other  reasons.  
Specifically, NIE  asserts  that because  of  a  misunderstanding 
between it  and its  former  counsel, NIE  believed that  it  was 
permitted to continue selling the long-range cordless  telephones 
as long as they were sold for export only.  NIE further  contends 
that  it  mistakenly  believed  it  was  selling  the  long-range 
cordless telephone for export when the Commission agent gave  his 
address as "Puerto Rico."  NIE also contends that it has  removed 
all of the offending items from its store, has obtained a  credit 
from its  wholesaler  for  the  return of  those  items,  and  is 
cooperating  with  the   Enforcement  Bureau   in  this   matter.  
Alternatively, NIE claims that it  would be an extreme  financial 
hardship for it to  pay the forfeiture proposed  in light of  its 
small profit margin over the last three years.    

                                        III. DISCUSSION
 
          6.   The forfeiture amount in this case was assessed in 
accordance with Section 503(b) of the Communications Act of 1934, 
as amended  (``Act''),5  Section  1.80 of  the  Rules,6  and  The 
Commission's Forfeiture Policy Statement and Amendment of Section 
1.80 of the  Rules to Incorporate  the Forfeiture Guidelines,  12 
FCC Rcd 17087 (1997), recon. denied,  15 FCC Rcd 303 (1999).   In 
examining NIE's response, Section 503(b) of the Act requires that 
the Commission  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  other such matters as justice  may 
require.7


     7.   Section 302(b) of the Act provides that no 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.  
Section 2.803(a)(1) of the Rules provides that:

          (a) Except 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:  (1) 
          [i]n   the   case   of   a   device   subject   to 
          certification, such device has been authorized  by 
          the Commission  in accordance  with the  rules  in 
          this  chapter  and  is  properly  identified   and 
          labeled as required by ' 2.925 and other  relevant 
          sections in this chapter[.]

NIE contends that, after consulting  with its prior attorney,  it 
believed that it was permitted to continue selling the long-range 
cordless telephones as long  as they were  sold for export  only.  
NIE also contends that it sold the cordless telephone to the  FCC 
agent thinking that  it was  being sold for  export, because  the 
agent told the salesperson  that his address  was in Puerto  Rico 
and the salesperson mistakenly believed for export purposes, that 
Puerto Rico was outside the  United States.  Section 2.807(b)  of 
the Rules8  exempts devices  ``manufactured solely  for  export'' 
from the prohibition of  Section 2.803(a)(1) which prohibits  the  
marketing of non-compliant devices.  However, the exemption  only 
applies  to  devices  that  the  manufacturer  actually   exports 
(emphasis added).  NIE was not the manufacturer of the device  at 
issue here.   As a  retailer, NIE  is not  entitled to  use  this 
exemption.  In any event, the fact that NIE was selling the long-
range cordless telephones  in a  retail store  in Miami,  Florida 
indicates that  NIE  was  engaged  in  marketing  the  long-range 
cordless telephones to the general public in the United  States.9  
Moreover,  even   though   NIE   alleges   that   there   was   a 
misunderstanding between it and its former counsel, reliance upon 
advice  of  counsel  is  "grounds  for  neither  rescission   nor 
mitigation  of  a  forfeiture  penalty."10   Additionally,  NIE's 
statement to this effect is inconsistent with the information NIE 
initially provided the Bureau in response to the citation  issued 
to NIE on  August 24,  2001.  In  its response  of September  10, 
2001, NIE informed the Bureau  that the cordless telephones  were 
no longer in  the store.     If the cordless  telephones were  no 
longer in the store, they could  not possibly be sold for  export 
or otherwise.   Further, even  if export  by NIE  was  permitted, 
Puerto Rico is not considered to be outside of the United  States 
for the purpose of export.
     
     8.   Finally, NIE asserts  that because it  has removed  the 
long-range cordless  telephones from  the store,  has obtained  a 
credit from its wholesaler  for the return of  the phones and  is 
cooperating with the Enforcement Bureau, the forfeiture should be 
cancelled or reduced.  We  disagree.  Corrective action taken  to 
come into compliance with Commission rules or policy is expected, 
and does  not  nullify  or  mitigate  any  prior  forfeitures  or 
violations.11
 
     9.   Alternatively, NIE asserts that it would be an  extreme 
financial hardship for NIE to pay the forfeiture imposed in light 
of the small profit margin it has experienced over the last three 
years.  In support of  its claim of  financial hardship, NIE  has 
submitted its  federal income  tax returns  for tax  years  1998, 
1999, and 2000.  The Commission has determined that, in  general, 
a licensee's gross revenues are the best indicator of its ability 
to pay  a  forfeiture.12   After  reviewing  the  financial  data 
submitted, we  find  no evidence  in  NIE's response  that  would 
support cancellation of the forfeiture or a reduction based  upon 
financial hardship. 

                      IV.  ORDERING CLAUSES

     10.  Accordingly, IT IS  ORDERED THAT,  pursuant to  Section 
503(b) of the Act and Sections 0.111, 0.311 and 1.80(f)(4) of the 
Rules,13 New Image  Electronics, Inc.  IS LIABLE  FOR A  MONETARY 
FORFEITURE in the amount of  seven thousand dollars ($7,000)  for 
violating Section 302(b)  of the Act  and Section 2.803(a)(1)  of 
the Rules. 

     11.  Payment of the forfeiture shall  be made in the  manner 
provided for in Section 1.80 of  the Rules within 30 days of  the 
release of this Order.  If the forfeiture is not paid within  the 
period specified, the case may  be referred to the Department  of 
Justice for collection pursuant to  Section 504(a) of the  Act.14  
Payment shall be made by  mailing a check or similar  instrument, 
payable to the order of the "Federal Communications  Commission," 
to  the  Federal  Communications  Commission,  P.O.  Box   73482, 
Chicago, Illinois 60673-7482.  The payment should note  NAL/Acct. 
No. 20023700003, and FRN 0006-3343-12.  Requests for full payment 
under an installment plan should  be sent to: Chief, Revenue  and 
Receivables  Group,  445  12th  Street,  S.W.,  Washington,  D.C. 
20554.15
     
     






     12.  IT IS FURTHER ORDERED that, a copy of this Order  shall 
be sent by Certified Mail  Return Receipt Requested to New  Image 
Electronics, Inc. at 9 West Flagler Street, Miami, Florida  33130 
and to its counsel  Gary S. Glasser,  Esq. at Biscayne  Building, 
Suite 1400, 19 West Flagler Street, Miami, Florida 33130.

                         FEDERAL COMMUNICATIONS COMMISSION
                    

                                                                  
                         David H. Solomon
                                                                  
Chief, Enforcement Bureau
           









_________________________

  1    47 U.S.C.  302(b).

  2    47 C.F.R.  2.803(a)(1).

  3   Notice of Apparent Liability for Forfeiture, NAL/Acct.  No. 
200232700003 (Enf.  Bur.,  Miami  Office,  released  October  29, 
2001).



  4    See e.g., 47 C.F.R. '' 15.201, 2.925, and 15.19.

  5   47 U.S.C.  503(b).

  6   47 C.F.R.  1.80.

  7   47 U.S.C.  503(b)(2)(D).

  8    47 C.F.R. ' 2.807(b).

  9    See Amertel Electronics Corp., 8 FCC Rcd 4462, 4462 (Field 
Operations Bureau 1993). 

  10  See Virginia RSA 6 Cellular Limited Partnership, 7 FCC  Rcd 
8022, 8022 (1992). 

  11  See  Seawest  Yacht  Brokers DBA  San  Juan  Marina  Friday 
Harbor, Washington, 9 FCC Rcd 6099, 6099 (1994).

  12   See PJB Communications of Virginia, Inc., 7 FCC Rcd  2088, 
2089 (1992). 

  13   47 C.F.R.  0.111, 0.311, 1.80(f)(4).

  14   47 U.S.C.  504(a).

  15   See 47 C.F.R.  1.1914.