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Before the
Federal Communications Commission
Washington, D.C. 20554
In the Matter of ) File No. EB-03-DL-099
)
Pilot Travel Centers, L.L.C. ) NAL/Acct. No. 200532500001
)
Knoxville, Tennessee ) FRN # 0006096010
NOTICE OF APPARENT LIABILITY FOR FORFEITURE
Adopted: November 18, 2004 Released: November
22, 2004
By the Commission:
I. INTRODUCTION
1. In this Notice of Apparent Liability for Forfeiture
(``NAL''), we find Pilot Travel Centers, L.L.C. (``Pilot'')
apparently liable for a forfeiture in the amount of one hundred
twenty-five thousand dollars ($125,000) for willful and repeated
violations 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 Specifically, we find Pilot
apparently liable for offering for sale radio frequency devices
without the required Commission equipment authorization.
II. BACKGROUND
2. Section 302 of the Act authorizes the Commission to
make reasonable regulations, consistent with the public interest,
governing the interference potential of equipment that emits
radio frequency energy,3 and prohibits, inter alia, the offering
for sale of radio frequency devices to the extent such activity
does not comply with those regulations. The purpose of this
section is to ensure that radio transmitters and other electronic
devices meet certain standards to control interference before
they reach the market. The Commission carries out its
responsibilities under Section 302 in two ways. First, the
Commission establishes technical regulations for transmitters and
other equipment to minimize their potential for causing
interference to radio services. Second, the Commission
administers an equipment authorization program to ensure that
equipment reaching the market complies with the technical
requirements.4 The equipment authorization program requires that
equipment be tested either by the manufacturer or at a private
test laboratory to ensure that it complies with the technical
requirements. For a large number of devices, including Citizens
Band (``CB'') radio transmitting equipment,5 equipment may not be
marketed within the United States unless it has been tested and
found to comply with Commission technical requirements, granted
Commission Certification, and properly labeled.6 ``Marketing''
includes the sale or lease, offer for sale or lease (including
advertising for sale or lease), importing, shipping, and/or
distribution for the purpose of selling or leasing or offering
for sale or lease.7
3. Unlike CB radio transmitting equipment, radio
transmitting equipment that transmits solely on Amateur Radio
Service (``ARS'') frequencies is not subject to equipment
authorization requirements prior to manufacture or marketing.
However, some radio transmitters that transmit in a portion of
the 10-meter band of the ARS (28.000 to 29.700 MHz) are equipped
with rotary, toggle, or pushbutton switches mounted externally on
the unit, which allow operation in the CB bands after completion
of minor and trivial internal modifications to the equipment. To
address these radios, the Commission adopted changes to the CB
type acceptance requirements by defining a ``CB Transmitter'' as
``a transmitter that operates or is intended to operate at a
station authorized in the CB.''8
4. Despite these changes to the definition of a CB
transmitter, Commission enforcement agents continued to encounter
non-certified CB transmitters marketed as ARS transmitters. On
May 13, 1996, the Commission's Office of Engineering and
Technology (``OET'') released a Public Notice ``to clarify the
Commission's Rules regarding equipment that is intended to
operate in various radio services in the high frequency radio
spectrum, including '10-Meter' Amateur Radio Service (ARS)
equipment.''9 The Notice stated that transmitters intended for
operation on non-amateur frequencies must be approved prior to
manufacture, importation or marketing. The Notice specifically
included ARS transceivers designed ``such that they can easily be
modified by the users to extend the operating frequency range
into the frequency bands'' of the CB and other non-amateur radio
services among those devices subject to equipment authorization
procedures. The Notice also stated that the Commission considers
these transceivers as intended to be operated on frequencies
where the use of type accepted equipment is required ``because of
the simplicity of modifying them to extend their operating
frequency range.''10 The Commission's Office of General Counsel
(``OGC'') later released a letter on the importation and
marketing of ARS transmitters, which clarified that such
transmitters that ``have a built-in capability to operate on CB
frequencies and can easily be altered to activate that
capability, such as by moving or removing a jumper plug or
cutting a single wire'' fall within the definition of ``CB
transmitter'' under Section 95.603(c) of the Rules and therefore
require certification prior to marketing or importation.11
5. From December 9, 2001 through May 6, 2003, the
Commission received four complaints specifically naming Pilot
Travel Centers as marketing non-certified CB transceivers. From
August 2001 through September 2002, Enforcement Bureau field
agents visited eleven Pilot retail outlets at the following
locations: Sulphur Springs, Texas; Dallas, Texas; Weatherford,
Texas; Brooks, Oregon; Casa Grande, Arizona; Quartzsite,
Arizona; North Palm Springs, California; North Las Vegas,
Nevada; Barstow, California; Boron, California; and Hesperia,
California. At these locations, the stores displayed and offered
for sale various models of non-certified CB transceivers marketed
as ARS transmitters. Prior to the field visits, OET had tested
all of these models and found each of them to be non-certified CB
transceivers.
6. As a result of agent inspections of Pilot retail stores
from December 2, 1999 to September 6, 2002, Enforcement Bureau
Field Offices issued nine Citations to Pilot. The Bureau issued
one Citation to Pilot's corporate headquarters in Knoxville,
Tennessee, and eight Citations to different Pilot retail outlets
in Brooks, Oregon; Casa Grande, California; Quartzsite,
California; North Palm Springs, California; North Las Vegas,
Nevada; Barstow, California; Boron, California; and Hesperia,
California. Each of these Citations advised Pilot of observed
violations of the Commission's equipment authorization and
marketing rules, specifically, marketing non-certified CB
transceivers in violation of Section 302(b) of the Act and
Section 2.803(a)(1) of the Rules. The Citations warned Pilot
that future violations may subject Pilot to civil monetary
forfeitures not to exceed $11,000 for each such violation or each
day of a continuing violation,12 seizure of equipment through in
rem forfeiture action, and criminal sanctions including fines and
imprisonment.13
7. On December 7, 2001, the Enforcement Bureau's Dallas
Field Office (``Dallas Office'') received from Pilot a response
dated December 6, 2001 to the Citation issued to Pilot's
corporate headquarters in Knoxville, Tennessee. The response
from Pilot's Vice President, General Counsel, and Secretary
stated that ``[a]ll of the radios in question are marketed as
amateur radios and, as sold, operate on the 10-meter amateur
band. Part 97 of 47 C.F.R., not Part 95, governs these
transceivers. Part 97 does not require type acceptance of
amateur radios.'' On January 28, 2002, the Dallas Office mailed
a letter to Pilot's corporate headquarters addressing Pilot's
response to the Citation. The letter advised Pilot that the
devices referred to in the Citation are intended for use on CB as
well as ARS frequencies, because they have built-in design
features which facilitate their operation on CB frequencies by
the exercise of simple, end-user accessible, modifications to the
devices. The letter further advised that such devices are
considered CB transmitters pursuant to Section 95.603(c) of the
Rules, irrespective of any labeling purporting the devices to be
``Amateur Radio Transceivers.'' The Dallas Office received no
further response from Pilot. In addition, Enforcement Bureau
Field Offices received five other responses from Citations issued
to Pilot, one response from Pilot's Vice President, General
Counsel, and Secretary and four other responses from a Pilot
Paralegal. All five responses similarly disputed the
Commission's statements in the Citations that Pilot illegally
marketed non-certified CB transmitters. Enforcement Bureau Field
Offices issued follow-up responses to each of these letters
advising Pilot that the devices in question are considered CB
transmitters and that marketing of the non-certified devices was
not lawful.
8. Subsequent to issuance of the above-mentioned Citations
and follow-up letters, from December 11, 2003 to July 3, 2004,
Enforcement Bureau field agents made seven visits to Pilot retail
stores nationwide where Pilot offered for sale non-certified
models of Galaxy brand CB transceivers.14 As noted above, OET
had already tested these specific models and determined them all
to be dual use Amateur Radio and CB transmitters. Each of the
models could be modified to allow transmit capabilities on CB
frequencies.
9. On December 16, 17, and 18, 2003, Enforcement Bureau
field agents purchased three Galaxy transceivers (models DX33HML,
DX99V and DX66V, respectively) from three different Pilot retail
stores and had them tested by the laboratory of OET. On April 1,
2004, the laboratory of OET issued an evaluation report for each
of the three purchased transceivers and found that they were all
non-certified CB transmitters.
III. DISCUSSION
10. 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[.]
11. Section 95.603(c) of the Rules requires that ``[e]ach
CB transmitter (a transmitter that operates or is intended to
operate at a station authorized in the CB) must be
certificated.'' Section 95.655(a) of the Rules states that
``[n]o transmitter will be certificated for use in the CB service
if it is equipped with a frequency capability not [authorized for
CB in Part 95 of the Rules].'' This section also states that
``([CB t]ransmitters with frequency capability for the Amateur
Radio Services ... will not be certificated.)'' Additionally,
Section 95.655(c) of the Rules prohibits any internal or external
add-on device that functions to extend the transmitting frequency
capability of a CB transmitter beyond its original capability.
12. Prior to October 2002, Pilot offered for sale various
non-certified CB transmitters at eleven of its retail outlets.
Commission Field Offices issued a total of nine Citations to
Pilot's corporate headquarters and its retail outlets warning
Pilot that future violations would subject Pilot to penalties
including civil monetary forfeitures. Subsequently, in forty-
seven separate instances from October 8, 2002 to July 3, 2004,
Pilot offered for sale various models of non-certified Galaxy
brand CB transmitters, which had all been tested and determined
by OET to be non-certified CB transmitters. Although they were
labeled as ``amateur radios,'' the specified models of Galaxy
transmitters are CB transmitters, because each was designed to be
easily modified by the end user to allow operation on CB
frequencies. Additionally, in at least eleven of the forty-seven
instances of marketing by Pilot, Pilot employees referred to the
devices as ``CB's.''
13. Based on the evidence before us, we find that in
thirteen instances -- six on December 11, 2003, one each on
December 16, 17, and 18, 2003, three on March 25, 2004, and one
on July 3, 2004 -- Pilot offered for sale non-certified CB
transmitters in apparent willful15 and repeated16 violation of
Section 302(b) of the Act and Section 2.803(a)(1) of the Rules.17
14. Section 503(b) of the Act,18 authorizes the Commission
to assess a forfeiture for each willful or repeated violation of
the Act or of any rule, regulation, or order issued by the
Commission under the Act. In exercising such authority, we are
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.''19
15. 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'')20 and Section 1.80 of the Rules,21 the base
forfeiture amount for marketing unauthorized equipment is $7,000
per violation. Thus, the total base forfeiture amount for all of
Pilot's violations is $91,000.
16. We are concerned, however, with the pattern of apparent
violations here. Our equipment authorization rules ensure that
radio transmitters and other electronic equipment comply with
Commission technical requirements. The proliferation of non-
certified CB transmitters may result in interference to certified
CB transmitters and other devices, thereby undermining the
effectiveness of our technical rules. Furthermore, we have
previously stated that ARS equipment that can be easily modified
to extend the operating frequency range into CB frequency bands
are CB transmitters subject to equipment authorization
procedures.22
17. We are particularly troubled that Pilot continues to
violate these rules despite receiving nine Citations for
marketing non-certified CB transmitters. These Citations put
Pilot on actual notice that marketing of this equipment is
unlawful, yet Pilot intentionally continued to market the
unlawful equipment. Pilot's continuing violations of the
equipment authorization requirements evince a pattern of
intentional non-compliance with and apparent disregard for these
rules. Accordingly, we believe an upward adjustment of the base
forfeiture amount is warranted.23 Applying the Forfeiture Policy
Statement and statutory factors (e.g., nature, extent and gravity
of the violation and the history of prior offenses)24 to the
instant case, we conclude that it is appropriate to propose a
forfeiture of $125,000 for Pilot's apparent violations.
Therefore, we find Pilot apparently liable for a forfeiture in
the amount of $125,000.
IV. ORDERING CLAUSES
18. Accordingly, IT IS ORDERED that, pursuant to Section
503(b) of the Communications Act of 1934, as amended, and Section
1.80 of the Commission's Rules, Pilot Travel Centers, L.L.C. is
hereby NOTIFIED of this APPARENT LIABILITY FOR A FORFEITURE in
the amount of one hundred and twenty-five thousand dollars
($125,000) for willfully and repeatedly violating Section 302(b)
of the Act, and Section 2.803(a)(1) of the Rules.
19. IT IS FURTHER ORDERED that, pursuant to Section 1.80 of
the Rules, within thirty days of the release date of this NAL,
Pilot Travel Centers, L.L.C. SHALL PAY the full amount of the
proposed forfeiture amount or SHALL FILE a written statement
seeking reduction or cancellation of the proposed forfeiture.
20. Payment of the forfeiture may 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 by check or
money order may be mailed to Forfeiture Collection Section,
Finance Branch, Federal Communications Commission, P.O. Box
73482, Chicago, Illinois 60673-7482. Payment by overnight mail
may be sent to Bank One/LB 73482, 525 West Monroe, 8th Floor
Mailroom, Chicago, IL 60661. Payment by wire transfer may be
made to ABA Number 071000013, receiving bank Bank One, and
account number 1165259. Requests for payment of the full amount
of this Notice of Apparent Liability under an installment plan
should be sent to: Chief, Revenue and Receivables Operations
Group, 445 12th Street, S.W., Washington, D.C. 20554.25
21. The response if any must be mailed to Office of the
Secretary, Federal Communications Commission, 445 12th Street,
S.W., Washington, D.C. 20554, ATTN: South Central Region
Headquarters and must include the NAL/Acct. No. 200532500001.
22. 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.
23. IT IS FURTHER ORDERED that a copy of this NAL shall be
sent by regular First Class Mail and by Certified Mail Return
Receipt Requested to: Pilot Travel Centers L.L.C., 5508 Lonas
Drive, Knoxville, Tennessee 37909.
FEDERAL COMMUNICATIONS COMMISSION
Marlene H. Dortch
Secretary
ATTACHMENT
1. December 11, 2003, Pilot center #320, Dallas, Texas.
Non-certified CB transceiver Galaxy model DX33HML displayed
and offered for sale.
2. December 11, 2003, Pilot center #320, Dallas, Texas.
Non-certified CB transceiver Galaxy model DX66V displayed and
offered for sale.
3. December 11, 2003, Pilot center #320, Dallas, Texas.
Non-certified CB transceiver Galaxy models DX99V displayed and
offered for sale.
4. December 11, 2003, Pilot center #433, Dallas, Texas.
Non-certified CB transceivers Galaxy model DX33HML displayed
and offered for sale.
5. December 11, 2003, Pilot center #433, Dallas, Texas.
Non-certified CB transceivers Galaxy model DX66V displayed and
offered for sale.
6. December 11, 2003, Pilot center #433, Dallas, Texas.
Non-certified CB transceivers Galaxy model DX99V displayed and
offered for sale.
7. December 16, 2003, Pilot center #95, Wildwood, Florida.
Non-certified CB transceiver Galaxy model DX33HML displayed,
offered for sale, and sold.
8. December 17, 2003, Pilot center #94, Punta, Florida.
Non-certified CB transceiver Galaxy model DX99V displayed,
offered for sale, and sold.
9. December 18, 2003, Pilot center #328, Dallas, Texas.
Non-certified CB transceiver Galaxy model DX66V displayed,
offered for sale, and sold.
10. March 25, 2004, Pilot center #460, Oklahoma City,
Oklahoma. Non-certified CB transceiver Galaxy model DX33HML
displayed and offered for sale.
11. March 25, 2004, Pilot center #460, Oklahoma City,
Oklahoma. Non-certified CB transceiver Galaxy model DX66V
displayed and offered for sale.
12. March 25, 2004, Pilot center #460, Oklahoma City,
Oklahoma. Non-certified CB transceiver Galaxy model DX99V
displayed and offered for sale.
13. July 3, 2004, Pilot center #35, South Bend, Indiana.
Non-certified CB transceiver Galaxy model DX66V displayed and
offered for sale.
_________________________
147 U.S.C. § 302a(b).
247 C.F.R. § 2.803(a)(1).
347 U.S.C. § 302a.
447 C.F.R. Part 2, Subpart J.
5CB radio operation is confined to forty specified channels from
26.965 MHz to 27.405 MHz (carrier frequency).
6See 47 C.F.R. § 2.927(a).
747 C.F.R. § 2.803(a).
847 C.F.R. § 95.603(c) [FCC 88-256], amended changing ``type
acceptance'' to ``certification'' [FCC 98-58].
9Extended Coverage High Frequency Transceivers, Public Notice
62882, 1996 WL 242469, available at
<> (OET, rel. May 13, 1996) (``Notice'').
10Id.
11Letter from Christopher Wright, General Counsel, FCC to John
Atwood, Chief Intellectual Property Rights, US Customs Service,
14 FCC Rcd 7797 (OGC, 1999).
12See 47 C.F.R. § 1.80(b)(3).
13See 47 U.S.C. §§ 501, 503(b), 510.
14See ATTACHMENT for a listing of the Pilot stores visited and
the models observed.
15Section 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 . . . .'' See Southern California Broadcasting Co., 6
FCC Rcd 4387-88 (1991).
16The 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.'' 47 U.S.C. §
312(f)(2).
17Although Pilot offered for sale non-certified CB transmitters
on days prior to December 11, 2003, the Commission is barred from
enforcing those violations by the statute of limitations
contained in Section 503(b)(6) of the Act.
1847 U.S.C. § 503(b).
1947 U.S.C. § 503(b)(2)(D).
2012 FCC Rcd 17087 (1997), recon. denied 15 FCC Rcd 303 (1999).
2147 C.F.R. § 1.80.
22See 47 C.F.R. § 95.603(c). See also Letter from Christopher
Wright, General Counsel, FCC to John Atwood, Chief Intellectual
Property Rights, US Customs Service, 14 FCC Rcd 7797 (1999).
23See, e.g., AT&T Wireless Services, Inc., 17 FCC Rcd 21866
(2002) (base forfeiture amount tripled); American Tower
Corporation, 16 FCC Rcd 1282 (2002) (base forfeiture amount
doubled).
24See also 47 C.F.R. § 1.80, Note to paragraph (b)(4): Section
II. Adjustment Criteria for Section 503 Forfeitures.
25See 47 C.F.R. § 1.1914.