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Federal Communications Commission
Washington, D.C. 20554
In the Matter of )
File No. EB-06-IH-0824
Multicultural Radio Broadcasting )
Licensee, LLC )
NAL/Acct. No. 200832080010
Licensee of Station KAZN(AM) )
Facility ID No. 10825
Pasadena, California )
NOTICE OF APPARENT LIABILITY FOR FORFEITURE
Adopted: December 13, 2007 Released: December 13, 2007
By the Chief, Investigations and Hearings Division:
1. In this Notice of Apparent Liability for Forfeiture ("NAL"), issued
pursuant to Section 503(b) of the Communications Act of 1934, as
amended (the "Act"), and Section 1.80 of the Commission's rules, we
find Multicultural Radio Broadcasting Licensee, LLC ("Multicultural"),
licensee of Station KAZN(AM), Pasadena, California (the "Station"),
liable for a monetary forfeiture in the amount of $12,000 for its
repeated and willful violation of Section 73.1216 of the Commission's
rules by failing to "fully and accurately disclose the material terms
of contest[s] . . . and conduct the contest[s] substantially as
announced or advertised."
2. The Commission received a complaint, dated January 8, 2006 (the
"Complaint"), alleging that the Station failed to conduct three
separate contests in accordance with their advertised material terms
and the Commission's rules. The first of these contests, the "Sunny
Plaza Contest," was a raffle held in conjunction with the grand
opening of a local mall in the Summer of 2001. The second, the "Golden
Nugget Contest," was a call-in program in which listeners called in
and were asked a question; and if they answered correctly, they were
awarded a gift certificate for a three-day and two-night stay at the
Golden Nugget Hotel and Casino in Las Vegas, Nevada. This second
contest ran from April 17 through July 2, 2003, and a total of eight
gift certificates were awarded during that period. The third contest,
the "Station Anniversary Contest," was held during a Station event to
celebrate the one-year anniversary of one of the Station's radio
programs. It was held at the Chinese Culture Center on August 17,
2003, and promoted on the air.
3. Specifically, according to the Complaint, the Station broadcast the
Sunny Plaza Grand Opening Event live and it was hosted by Station
employee Kenny Ki and the Station's Sales Manager, Ruby Kuen. The
Complainant alleges that Ms. Kuen manipulated the prize drawings in
the Sunny Plaza Contest so that the top four contest prizes were
awarded to the four Station employees who were present at the event,
which included Ms. Kuen herself. The Complainant also alleges that the
Golden Nugget Contest was not conducted as advertised because Station
employees and personal friends of Ms. Kuen purported to be members of
the general listening audience for purposes of the contest, and that
these individuals called into Ms. Kuen's program from telephone lines
located within the Station's studio. The Complainant claims that Ms.
Kuen then knowingly selected these employees and friends to win the
Golden Nugget Contest prizes, to the detriment of the general
listening audience. With respect to the Station Anniversary Contest,
the Complainant alleges that five television sets were advertised as
giveaway prizes for the contest, but that only one television set was
awarded as a prize during that event.
4. Based on the allegations contained in the Complaint, the Enforcement
Bureau ("Bureau") sent a letter of inquiry (the "LOI") to the Licensee
on October 31, 2006. The Licensee responded by letter dated January 3,
2007 (the "LOI Response"). In its LOI Response, Multicultural denies
that the Station sponsored, planned, organized, or conducted the Sunny
Plaza Contest. It states that the contest was sponsored by the Sunny
Plaza shopping mall and conducted by Sunny Plaza staff, and that,
contrary to the Complainant's allegation, Station personnel did not
receive any prizes. Multicultural claims that the "Station's only
involvement in the prize giveaway was limited to two of its deejays
(Kenny Ki and Ruby Kuen) making the on-air announcement of the prize
winners" from its on-site location during the event. Multicultural
admits that a Station employee and the wife of another Station
employee each participated in, and won, a prize in the Golden Nugget
Contest, and that Ms. Kuen was given the winning prize by another
winner in the Golden Nugget Contest. Multicultural claims that none of
these prize certificates was redeemed for a prize. In a statement
attached to the LOI Response, Ms. Kuen states that she "was not in
charge of the equipment, when a call-in number [was] blinking, [sic]
she would not know who is calling in." With respect to the Station
Anniversary Contest, Multicultural acknowledges that it awarded only
two (and not one, as alleged by the Complainant) of the five
televisions advertised for the Station Anniversary Contest, but argues
that it is not responsible for that circumstance because the prize
sponsor failed to deliver the five prizes as promised to the Station.
5. Because the Licensee's responses to the LOI were incomplete, the
Bureau sent a supplemental letter of inquiry ("Supplemental LOI") to
the Licensee on March 19, 2007. Multicultural responded on March 30,
2007 ("Supplemental LOI Response"). In its Supplemental LOI Response,
Multicultural states that Station employees and their families and
friends are not permitted to participate in or receive a prize in
connection with any contest sponsored or broadcast by the Station.
Despite Multicultural's discovery during its investigation of the
allegations in this case that an employee and a family member of an
employee were awarded prizes, the Licensee denies knowledge of any
deviation from its policy. Multicultural maintains that Station
employees are informed of the policy by their supervisors and, in
turn, are responsible for relaying this information to their families
and friends. Furthermore, Multicultural states:
[T]he Station has mandatory guidelines that require that the written rules
for any on-air contest, promotion and give-away must include: a
description of who is eligible to participate in the contest; a
description of what will be required of contestants in order to be
eligible for winning the prizes in the contest; an exact description of
each prize to be awarded; clear and concise instructions about what a
winner must do to claim his or her prize; and what information a prize
winner must provide to the Station, or the holder of the prize, in order
to claim the prize."
6. Section 503(b)(1) of the Communications Act of 1934, as amended (the
"Act"), states that any person who willfully or repeatedly fails 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
monetary forfeiture penalty. In order to impose such a forfeiture
penalty, the Commission must issue a notice of apparent liability, the
notice must be received, and the person against whom the notice has
been issued must have an opportunity to show, in writing, why no such
forfeiture penalty should be imposed. The Commission may then issue a
forfeiture if it finds by a preponderance of the evidence that the
person has violated the Act or a Commission rule. As discussed below,
we conclude that, under this standard, Multicultural is apparently
liable for a forfeiture for its apparent willful and repeated
violation of Section 73.1216 of the Commission's rules.
7. Section 73.1216 of the Commission's rules provides that "[a] licensee
that broadcasts or advertises information about a contest it conducts
shall fully and accurately disclose the material terms of the contest,
and shall conduct the contest substantially as announced or
advertised. No contest description shall be false, misleading or
deceptive with respect to any material term." Material terms "include
those factors which define the operation of the contest and which
affect participation therein." Although the material terms may vary
widely depending on the exact nature of the contest, they will
generally include: "[instructions on] how to enter or participate;
eligibility restrictions; entry deadline dates; whether prizes can be
won; when prizes can be won; the extent, nature and value of prizes;
basis for valuation of prizes; time and means of selection of winners;
and/or tie-breaking procedures." While the time and manner of
disclosure of the material terms of a contest are within the
licensee's discretion, the Commission's contest rule dictates that
"the obligation to disclose the material terms arises at the time the
audience is first told how to enter or participate and continues
thereafter" and that "[t]he material terms should be disclosed
periodically by announcements broadcast on the station conducting the
8. Licensees, as public trustees, have the affirmative obligation to
prevent the broadcast of false, misleading, or deceptive contest
announcements, and to conduct their contests substantially as
announced. The Commission has noted that "[t]he standards are high,
for while contests are particularly susceptible to abuse, abuses can
be prevented by diligent licensee attention to the planning and the
conduct of contests." Here, the evidence indicates that the station
did not award prizes as announced in a certain contest. It also failed
to exercise diligence in conducting another contest when station
employees manipulated the process to benefit themselves or their
relatives and friends, in violation of the contest rules. Below, we
analyze each of the three contests - the Sunny Plaza Contest, the
Golden Nugget Contest, and the Station Anniversary Contest.
9. Sunny Plaza Contest. The Licensee denies the Complainant's allegations
regarding the Sunny Plaza contest. It states that it did not conduct
the contest, and its only involvement was announcing the contest
winners. Multicultural's statement that it was hired only to broadcast
the Sunny Plaza event, including the contest drawing, and that it did
not conduct or sponsor the contest is confirmed by the overall record
evidence. Accordingly, because this contest is not a
licensee-conducted contest under Section 73.1216, we deny the
Complaint with respect to this contest.
10. Golden Nugget Contest. In response to our LOI request for all
available information and documentation regarding the material terms
of the Golden Nugget Contest, the Licensee submitted only a memorandum
outlining the Golden Nugget Contest promotions that were aired over
the Station. Multicultural contends that this memorandum is a copy of
its rules for several contests; however, the memorandum does not
provide most of the material terms of the contests. Specifically, it
does not discuss eligibility requirements, including whether Station
employees and their families were eligible to enter or win prizes in
the contests. Although Multicultural claims to have broadcast contest
rules for the Golden Nugget Contest prior to contest drawings, it
acknowledges that eligibility was not addressed. It is clear from the
Commission's contest rule that eligibility restrictions are material
terms that must be announced. The Station's argument that employees
are expected to know they are ineligible is unavailing since the rules
require announcement, which the Station admittedly failed to do.
11. Furthermore, even if we assume that the Station was diligent in
announcing its eligibility restrictions, it appears the Station's
employees manipulated the results of the contest despite any
countervailing rule. Multicultural admits that at least two prize
certificates for a three-day and two-night stay at the Golden Nugget
Hotel and Casino in Las Vegas were given to ineligible participants:
(1) Zhang Hai-Hong, the wife of Station employee Ning Gao; and (2)
Judy Lin, a sales associate at the Station. This result was to the
ultimate detriment of members of the listening public who participated
in the contest, a violation of the rules Multicultural asserts
governed all its contests.
12. In the LOI Response, Station Sales Manager Ruby Kuen denies knowing
the identities of the people calling in to the program she hosted in
order to participate in the Golden Nugget Contest. This does not
change the fact that the Station awarded prizes to ineligible
participants or the fact that at least one of the participants was an
employee and therefore an agent of the Station. Multicultural argues
that the award of the prize certificates to the ineligible
participants does not violate our contest rule because the prize
certificates were not redeemed. Even if true, the Commission's rules
were still violated because the Station failed to conduct its contest
in conformity with its own contest rules. Further, we note that the
record does not demonstrate that Multicultural ever awarded these
prizes to eligible participants, effectively reducing the advertised
number of contest prizes. Given the foregoing, we find that the
Licensee failed to conduct the Golden Nugget Contest in accordance
with the material terms of that contest, failed to disclose all
material terms, and failed to conduct the contest substantially as
advertised, in violation of Section 73.1216.
13. Station Anniversary Contest. The Licensee admits that it promoted the
Station Anniversary Contest by advertising that it would award five
televisions as contest prizes, but that, in actuality, only two
televisions were awarded. The Licensee's justification for its failure
is that the prize donor donated only two televisions instead of the
five that were promised. A prize donor's failure to honor its promise
to a station, however, does not relieve the station of its duty to
conduct a contest as advertised and to honor its promise to the
public. The "extent, nature and value of prizes" are material terms
under Section 73.1216, and, consequently, the number of televisions
awarded is a material term of the Station Anniversary Contest. We
therefore find that the Licensee failed to conduct its Station
Anniversary Contest substantially as advertised and, thus, violated
14. In sum, we find that Multicultural willfully and repeatedly violated
Section 73.1216 of the Commission's rules in the Golden Nugget Contest
and the Station Anniversary Contest. Specifically, Multicultural
violated Section 73.1216 with respect to the Golden Nugget Contest
when it failed to announce eligibility requirements for the contest
and when it awarded prizes to Station employees and their families and
friends in at least two instances. We also find that Multicultural
violated Section 73.1216 with respect to the Station Anniversary
Contest when it failed to conduct the contest substantially as
advertised, awarding two prizes instead of five.
15. The Commission's Forfeiture Policy Statement and Section 1.80 of the
Commission's rules specify a base forfeiture amount of $4,000 for
violation of Section 73.1216. In assessing the monetary forfeiture
amount, we must 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 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. Here, we find that the Licensee apparently violated Section
73.1216 of the Commission's rules multiple times in two distinct
contests. Further, the Forfeiture Policy Statement and Section 1.80 of
the Commission's rules provide that base forfeitures may be adjusted
based upon consideration of the factors enumerated in Section
503(b(2)(D) of the Act and Section 1.80(a)(4) of the Commission's
rules which include, among other reasons, egregious misconduct,
intentional violation, substantial harm, and repeated or continuous
violation. We find that the multiple contest violations in this case
that occurred on various dates between April 17 through July 2, 2003
with respect to the Golden Nugget Contest, and the violation on August
17, 2003 with respect to the Station Anniversary Contest, demonstrate
a pattern of violative conduct with regard to the Licensee's
administration of its contests. We further find that the Station's
conduct with respect to the Golden Nugget Contest was particularly
egregious, in that multiple prizes were awarded to and received by
Station employees or their family members or friends. Accordingly, we
find that an upward adjustment of the base forfeiture amount is
appropriate in this case and propose a forfeiture of $12,000 for the
Licensee's apparent violations of Section 73.1216 of the Commission's
III. ORDERING CLAUSES
16. ACCORDINGLY, IT IS ORDERED, 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, that Multicultural Radio Broadcasting
Licensee, LLC, is hereby NOTIFIED of its APPARENT LIABILITY FOR
FORFEITURE in the amount of $12,000 for willfully and repeatedly
violating Sections 73.1216 of the Commission's rules.
17. IT IS FURTHER ORDERED, pursuant to Section 1.80 of the Commission's
rules, that within thirty (30) days of the release of this Notice,
Multicultural Radio Broadcasting Licensee, LLC, SHALL PAY the full
amount of the proposed forfeiture or SHALL FILE a written statement
seeking reduction or cancellation of the proposed forfeiture.
18. Payment of the forfeiture must be made by mailing a check or similar
instrument, payable to the order of the Federal Communications
Commission. The payment MUST INCLUDE the FCC Registration Number
("FRN") and the NAL/Acct. No. specified in the caption of this NAL.
Payment by check or money order may be mailed to Forfeiture Collection
Section, Finance Branch, 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
19. The response, if any, must be mailed to Hillary S. DeNigro, Chief,
Investigations and Hearings Division, Enforcement Bureau, Federal
Communications Commission, 445 12th Street, S.W, Room 4-C330,
Washington, D.C. 20554 and MUST INCLUDE the NAL/Acct. No. referenced
20. The Commission will not consider reducing or canceling a forfeiture in
response to a claim of inability to pay unless the respondent 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 respondent'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.
21. Requests for payment of the full amount of the NAL under an
installment plan should be sent to: Associate Managing Director -
Financial Operations, 445 12th Street, S.W., Room 1-A625, Washington,
22. IT IS FURTHER ORDERED that the complaint filed by the Complainant IS
GRANTED to the extent indicated herein, and the complaint proceeding
IS HEREBY TERMINATED..
23. IT IS FURTHER ORDERED that a copy of this Notice shall be sent, by
Certified Mail/Return Receipt Requested, to Multicultural Radio
Broadcasting Licensee, LLC, 449 Broadway, New York, NY 10013, and to
its counsel, Mark Lipp, Esq., Wiley Rein & Fielding LLP, 1776 K
Street, NW, Washington, D.C. 20006 .
FEDERAL COMMUNICATIONS COMMISSION
Hillary S. DeNigro
Chief, Investigations and Hearings Division
See 47 U.S.C. S: 503.
See 47 C.F.R. S: 1.80.
47 C.F.R. S: 73.1216.
See Letter from Complainant to Judy Lancaster, Attorney, Investigations
and Hearings Division, Enforcement Bureau, Federal Communications
Commission, dated January 8, 2006 ("Complaint"). Because the Complainant
requested anonymity, we will not use the complainant's name in this Order.
A transcript of a portion of a recording that accompanied the Complaint is
referenced herein as the "Transcript."
See id at 1.
See Complaint at 2.
See id. at 1. The Complaint included a recording of a Station promotion
during which Ms. Kuen states that five television sets will be awarded as
prizes in the Station Anniversary Contest.
See Letter from Jennifer Lewis, Assistant Chief, Investigations and
Hearings Division, Enforcement Bureau, to Multicultural Radio Broadcasting
Licensee, LLC, dated October 31, 2006 (the "LOI").
See Letter from Yvonne Liu to Marlene H. Dortch, Secretary, Federal
Communications Commission, dated January 3, 2007 (the "LOI Response").
See LOI Response at 1.
See id. at 8, Attachment A.
See id. at 2.
See id. at 8, Attachment A.
See id. at 2.
See Letter from Jennifer Lewis, Assistant Chief, Investigations and
Hearings Division, Enforcement Bureau to Multicultural Radio Broadcasting
Licensee, Inc., dated March 19, 2007 ("Supplemental LOI").
See Letter from Yvonne S. Liu, Vice President and Assistant Secretary,
Multicultural Radio Broadcasting Licensee, LLC to Marlene H. Dortch,
Secretary, Federal Communications Commission, dated March 30, 2007.
See Supplemental LOI Response at 2-3.
See id. (wherein the License also admits that an additional contest prize
was donated by a winner to another employee).
See id. See also id. at 3 ("Ruby Kuen, Judy Lin, Kenny Ki, Sun Huang,
Alice Liu and Ning Gao were notified of the policy by Kevin Chu . . .").
See id. at 2.
See 47 U.S.C. S: 503(b)(1).
See 47 U.S.C. S:503(b); 47 C.F.R. S: 1.80(f). See also Saga Communications
of New England, LLC, Notice of Apparent Liability for Forfeiture, 22 FCC
Rcd 4206 (EB 2007); NM Licensing LLC, Notice of Apparent Liability for
Forfeiture, 21 FCC Rcd 7916 (EB 2006) (forfeiture paid).
See, e.g., SBC Communications, Inc., Forfeiture Order, 17 FCC Rcd 7589,
7591, P: 4 (2002) (forfeiture paid).
47 C.F.R. S: 73.1216.
47 C.F.R. S: 73.1216, Note 1(b).
Id. In addition to the required broadcast announcements, disclosure of the
material terms may be made in a non-broadcast manner. Id.
See WMJX, Inc., Decision, 85 FCC 2d 251, 269 (1981) (holding that proof of
actual deception is not necessary to find violations of contest rules, and
that the licensee, as a public trustee, has an affirmative obligation to
prevent the broadcast of false, misleading or deceptive contest
announcements); Amendment of Part 73 of the Commission's Rules Relating to
Licensee-Conducted Contests, Report and Order, 60 FCC 2d 1072 (1976).
See Headliner Radio, Inc., Memorandum Opinion and Order, 8 FCC Rcd 2962
(Mass Media Bur. 1993) (finding that the airing of a misleading
advertisement concerning a licensee's contest violated the Commission
contest rules because the contest was not then conducted "substantially as
announced or advertised"); Lincoln Dellar, Memorandum Opinion and Order, 8
FCC Rcd 2582, 2585 (Mass Media Bur. 1993) (finding that the cancellation
of a pre-announced contest violated the pertinent Commission rules because
the contest was not then conducted "substantially as announced").
Honeyradio, Inc., Memorandum Opinion and Order, 69 FCC 2d 833 (1978),
quoting Licensee-Conducted Contests, Proposed Rulemaking, 40 Fed. Reg.
26692 (1975) (holding licensee responsible for mistakes made during its
conduct of a contest, and affirming forfeiture and denying petition for
reconsideration of a letter of admonishment for violation of the
See id. 1, 3 (Multicultural denies that Station employees received prizes
from the Sunny Plaza Contest.). See id.
See id. at 1.
See id. at Attachment B.
See id. at 2.
See 47 C.F.R. S: 73.1216, Note 1(b).
See LOI Response at 2, Attachment A (which also notes that an unidentified
participant gave his or her prize to Ms. Kuen, the host of the Station
program broadcasting the contest).
See id. at Attachment A.
See 47 C.F.R. S: 73.1216, Note 1(b). See also Capstar TX Limited
Partnership, Notice of Apparent Liability for Forfeiture, 20 FCC Rcd 10636
(Enf. Bur. 2005) (forfeiture paid) (overstating the value of a contest
prize violates Section 73.1216); Clear Channel Broadcasting Licenses,
Inc., Notice of Apparent Liability for Forfeiture, 21 FCC Rcd 6808
(Investigations & Hearings Div. 2006) (forfeiture paid) ("In enforcing
[Section 73.1216], the Enforcement Bureau has repeatedly held that
licensees are responsible for broadcasting accurate statements as to the
nature and value of contest prizes, and will be held accountable for any
announcement that tends to mislead the public."); Duchossois
Communications Company of Maryland, Inc., Notice of Apparent Liability for
Forfeiture, 11 FCC Rcd 5785 (1996) (finding that a licensee violated
Section 73.1216 by (1) failing to award all prizes advertised; and (2)
when the Licensee gave station employees tickets that had been advertised
as prizes for the public); Randall T. Odeneal, Notice of Apparent
Liability, 7 FCC Rcd 4474 (MMB 1992) (finding a violation of Section
73.1216 when only part of a contest's prize money was awarded because the
non-licensee responsible for paying the prize money did not do so).
See Transcript, supra note 4.
See Mississippi Valley Broadcasting, Inc., Order on Reconsideration, 13
FCC Rcd 5891 (Mass Med. Bur. 1997) ("Whenever conducting a contest
involving a co-sponsor, licensees are responsible for awarding the
announced contest prize when a co-sponsor fails to do so.").
See 47 C.F.R. S: 73.1216(b).
See 47 C.F.R. S: 73.1216, Note 1(b).
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, 17113 (1997), recon. denied 15 FCC Rcd. 303
(1999) ("Forfeiture Policy Statement"); 47 C.F.R. S: 1.80(b).
See 47 U.S.C. S: 503(b)(2)(D).
See 47 U.S.C. S: 503(b)(2)(D); 47 C.F.R. 1.80(a)(4).
See WMGO Broadcasting, Notice of Apparent Liability for Forfeiture, DA
07-959 (rel. Inv. & Hrgs. Div March 2, 2007) (The station was found to
have violated Section 73.1206 by broadcasting telephone conversations over
the air without authorization on three different dates, resulting in a
proposed forfeiture of $8,000. The proposed forfeiture was based on an
upward adjustment of $4,000 that was added to a base forfeiture amount of
$4,000 for the unauthorized broadcast of a telephone conversation)
(petition for recons. pending).
See 47 C.F.R. S: 73.1216. See also Forfeiture Policy Statement; Clear
Channel Broadcasting Licenses, Inc., Notice of Apparent Liability for
Forfeiture, 21 FCC Rcd 6808 (EB 2006) (imposing $6,000 forfeiture for
violation of Section 72.1216 in a single contest) (forfeiture paid); AMFM
Radio Licenses LLC, et al, Notice of Apparent Liability for Forfeiture, 19
FCC Rcd 5005 (2004) (maximum forfeiture imposed for each of multiple
indecency rule violations) (forfeiture paid).
See 47 U.S.C. S: 503(b).
See 47 C.F.R. S:S: 0.111, 0.311 and 1.80.
See 47 C.F.R. S:S: 73.1216, 1.17 and 73.1015.
See 47 C.F.R. S: 1.1914.
For purposes of the forfeiture proceeding initiated by this NAL,
Multicultural Radio Broadcasting Licensee, LLC shall be the only party to
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Federal Communications Commission DA 07-4992
Federal Communications Commission DA 07-4992