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Federal Communications Commission
Washington, D.C. 20554
In the Matter of File No. EB-05-IH-2737
Spectracom, LLC NAL Account No.
Applicant for Assignment of Private Land
Mobile Stations WNFD452, WNHG245 and ) FRN No. 0003730710
Adopted: November 19, 2007 Released: November 20, 2007
By the Chief, Investigations and Hearings Division, Enforcement Bureau:
1. In this Forfeiture Order, we find that Spectracom, LLC ("Spectracom"),
applicant for assignment of Private Land Mobile stations WNFD452,
WNHG245, and WNHU507 (the "Stations"), willfully violated Section
1.948 of the Commission's rules by taking de facto control of the
Stations and operating those Stations without prior Commission
notification and approval. Specifically, Spectracom took control of
the Stations in June 2005, but did not apply to obtain Commission
approval of the Stations until November 14, 2005. We conclude,
pursuant to Section 503(b) of the Communications Act of 1934, as
amended ("Act"), that Spectracom is liable for forfeiture in the
amount of twelve thousand dollars ($12,000).
2. As discussed in detail in the Spectracom, LLC Notice of Apparent
Liability for Forfeiture ("NAL"), on November 14, 2005, Spectracom
filed an FCC Form 603 application for Commission consent to the
assignment of the licenses from Valley Comm to Spectracom (the
"Application"). Spectracom reported in Question 7 on the Application
that the assignment had already occurred. In response to a telephone
inquiry from Wireless Telecommunications Bureau licensing staff
regarding its answer to Question 7, Spectracom responded by letter,
and explained that it had purchased the community repeaters from
Valley Comm in June, 2005. Spectracom further acknowledged that it
began operating the systems on the date of purchase and continued to
operate them until the date of the letter on November 23, 2005. On
November 23, 2005, the Commission sent a letter to Spectracom
indicating that the assignment in question was apparently consummated
prior to Commission approval. In the same letter, the Commission
consented to the assignment of licenses, but did so without prejudice
to any subsequent enforcement action. Spectracom did not file a
notification of consummation following the consent to assignment as
required by Section 1.948(d), and therefore is not the licensee of
record for the Stations.
3. On November 13, 2006, we issued the NAL to Spectracom, proposing a
$12,000 forfeiture for engaging in an unauthorized transfer of control
of the Stations, which was largely based on Spectracom's own
admission, as described above. In a letter responding to the NAL dated
November, 25, 2006, Spectracom now contends that it had not
technically purchased the Stations, but, instead, had entered into a
lease arrangement with the intent to purchase the Stations when the
FCC Application could be completed. Specifically, Spectracom states
that it paid a "rental amount" to Valley Comm to be applied to the
purchase price, and under the lease arrangement, Valley Comm would
file the Application on Spectracom's behalf once Spectracom's rental
payments amounted to the purchase price of the Stations. According to
Spectracom, formal purchase of the Stations has not yet been completed
and, therefore, no unauthorized assignment took place because Valley
Comm continues to own the repeaters and the licenses at issue. A
search of the Commission's records indicates, however, that Spectracom
neither filed FCC Form 608 (Application or Notification for Spectrum
Leasing Arrangement or Private Commons Arrangement) for approval of
the alleged lease arrangement nor did it file FCC Form 603 (FCC
Wireless Telecommunications Bureau Application for Assignments of
Authorization and Transfers of Control) prior to November 14, 2005.
4. Section 1.948 of the Commission's rules requires that
"[a]uthorizations in the Wireless Radio Services may be assigned by
the licensee to another party, voluntarily or involuntarily, directly
or indirectly, or the control of a license holding such authorizations
may be transferred, only upon application to and approval by the
Commission." Thus, under Section 1.948 of the Commission's rules, a
licensee in the Wireless Radio Services involved in an assignment of
authorization or substantial transfer of control must apply to and
receive authorization from the Commission before control of a station
is transferred or an assignment is consummated.
5. In 2003, the Commission adopted a set of rules that allow for spectrum
leasing in certain circumstances. To be eligible to lease spectrum,
the licensee must have exclusive use of the spectrum. These rules
only permit transfer of de facto control under the spectrum leasing
provisions after Commission approval.
6. In the instant case, the record shows that Spectracom took control of
the Stations from Valley Comm in June 2005, and immediately began
operating the systems without prior FCC approval. In the NAL, we noted
that Spectracom filed its FCC Form 603 requesting approval of the
license assignments five months late. Spectracom argues in its NAL
Response that, during those five months, it was only leasing the
Stations. This defense is unavailing as it does not avoid the
requirement of prior Commission approval of spectrum leases, as noted
above. Further, because the licenses at issue here are for shared use
of frequencies below 470 MHz that are not eligible for spectrum
leasing, Spectracom could not have obtained Commission approval for
the transfers of control associated with the alleged spectrum leases
even if it had attempted to file for the requisite approvals.
Spectracom's NAL Response offers no other defenses or arguments. We
therefore find that Spectracom willfully violated Section 1.948 of the
Commission's rules by failing to notify and receive approval from the
Commission before assuming control of the licenses at issue.
7. With respect to the forfeiture amount, Spectracom asserts in response
to the NAL that it is unable to pay a forfeiture in the amount of
$12,000. As noted in the NAL, the Commission does not consider
reducing or canceling a forfeiture in response to a claim of inability
to pay unless such claim is supported by: (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 respondent's current financial status. Despite this
explicit direction, Spectracom has provided no documentation to
support its claim of inability to pay and therefore this defense must
8. Spectracom's NAL Response does not otherwise dispute the forfeiture
calculations described in detail in the NAL. We therefore affirm the
forfeiture calculation and methodology set forth in the NAL. Applying
the factors set forth in Section 1.80 and Section 503(b)(2)(D) of the
Act to the instant case, we conclude that Spectracom is liable for a
IV. ORDERING CLAUSES
9. ACCORDINGLY, IT IS ORDERED that, pursuant to Section 503(b) of the
Communications Act of 1934, as amended, and Sections 0.111, 0.311, and
1.80 of the Commission's Rules, Spectracom, LLC SHALL FORFEIT to the
United States government the sum of $12,000 for willfully violating
Section 1.948 of the Rules.
10. Payment of the forfeiture shall be made in the manner provided for in
Section 1.80 of the Commission's Rules within 30 days of the release
of this Forfeiture 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. 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 in the caption.
Payment by check or money order may be mailed to Federal
Communications Commission, P.O. Box 358340, Pittsburgh, PA 15251-8340.
Payment by overnight mail may be sent to Mellon Bank /LB 358340, 500
Ross Street, Room 1540670, Pittsburgh, PA 15251. Payment by wire
transfer may be made to ABA Number 043000261, receiving bank Mellon
Pittsburgh, and account number FCC/ACV 9116229.
11. Requests for payment of the full amount of this Forfeiture under an
installment plan should be sent to: Associate Managing Director,
Financial Operations, Federal Communications Commission, 445 12th
Street, S.W., Room 1-A625, Washington, DC 20554.
12. IT IS FURTHER ORDERED that a copy of this Forfeiture Order shall be
sent by Certified Mail, Return Receipt Requested, and regular mail, to
Spectracom, LLC at its address of record.
FEDERAL COMMUNICATIONS COMMISSION
Hillary S. DeNigro
Chief, Investigations and Hearings Division
See 47 C.F.R. S: 1.948.
See FCC Wireless Telecommunications Bureau Application for Assignments of
Authorization and Transfers of Control, File No. 0002379825, at 1
See 47 U.S.C. S: 503(b).
See Spectracom, LLC, Notice of Apparent Liability for Forfeiture, 21 FCC
Rcd 13412 (Enf. Bur. 2006).
See note 12, infra.
See Application at 1, Question 7.
See Letter from Paul McCarty, Spectracom, LLC, to Sharon Weigle, Public
Safety and Critical Infrastructure Division, Wireless Telecommunications
Bureau, Federal Communications Commission ("FCC"), dated November 23, 2005
("Paul McCarty Letter").
See Letter from Tracy Simmons, Associate Chief, Licensing Operations,
Public Safety and Critical Infrastructure Division, Federal Communications
Commission, to Spectracom, LLC, Attn. Paul Michael McCarty, dated November
See 47 C.F.R. S: 1.948(d).
See Spectracom,LLC, Notice of Apparent Liability for Forfeiture, 21 FCC
Rcd 13412 (Enf. Bur. 2006).
See Letter from Mike McCarty, Spectracom, to Hillary S. DeNigro, Chief,
Investigations and Hearings Division, Enforcement Bureau, dated November
25, 2006, at 1 ("NAL Response").
See 47 C.F.R. S:S: 1.9030(e) and 1.9035(e).
47 C.F.R. S: 1.948(a).
The leasing rules govern the transfer of de facto control pursuant to a
spectrum leasing arrangement. Specifically, the Commission relaxed its
policies to provide a process for lessors to obtain approval to transfer
control of station facilities to lessees. The Commission adopted new rules
including Section 1.9030(e) (relating to long term leases) and Section
1.9035(e) (relating to short term leases), which require the filing of an
FCC Form 608 prior to a transfer of de facto control of a wireless radio
system pursuant to a lease agreement. See Promoting Efficient Use of the
Spectrum Through Elimination of Barriers to Development of Secondary
Markets, Report and Order and Further Notice of Proposed Rulemaking, 18
FCC Rcd 20604 (2003); see also Promoting Efficient Use of the Spectrum
Through Elimination of Barriers to Development of Secondary Markets,
Report and Order and Further Notice of Proposed Rulemaking, Second Report
and Order, Order on Reconsideration, and Second Further Notice of Proposed
Rulemaking, 19 FCC Rcd 17503 (2004).
See 47 C.F.R. S:S: 1.9001(b).
See 47 C.F.R. S:S: 1.9030(e) and 1.9035(e).
See Paul McCarty Letter at 1.
See NAL Response at 1.
See 47 C.F.R. S:S: 90.173 and 1.9001(b).
See 47 C.F.R. S:S: 90.173, 1.9001(b), 1.9030(e) and 1.9035(e).
See NAL, 21 FCC Rcd at 13414-15, P: 11. See also The Commission's
Forfeiture Policy Statement and Amendment of Section 1.80 of the Rules to
Incorporate the Forfeiture Guidelines, 12 FCC Rcd 17087, 17106-07 (1997),
recon. denied, 15 FCC Rcd 303 (1999).
See NAL, 21 FCC Rcd at 13413-14, P:P: 5-6.
See 47 U.S.C. S: 503(b); 47 C.F.R. S:S: 0.111, 0.311, 0.314, 1.80, 1.948.
See 47 C.F.R. S: 1.80.
47 U.S.C. S: 504(a).
See 47 C.F.R. S: 1.1914.
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Federal Communications Commission DA 07-4678
Federal Communications Commission DA 07-4678