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                               February 14, 2012

                                                                    DA 12-212



   Mr. Jeremy R. Sheets

   c/o Mr. Martin E. Crandall

   Clark Hill PLC

   500 Woodward Ave., Suite 3500

   Detroit, MI 48226-3435

   Re: Notice of Debarment

   File No. EB-11-IH-1122

   Dear Mr. Sheets:

   The Federal Communications Commission (Commission) hereby notifies you
   that, pursuant to Section 54.8 of its rules, you are prohibited from
   participating in the schools and libraries universal service support
   mechanism (E-Rate program) for three years from either the date of your
   receipt of this Notice of Debarment, or of its publication in the Federal
   Register, whichever is earlier in time (Debarment Date).

   On October 18, 2011, the Commission's Enforcement Bureau (Bureau) sent you
   a Notice of Suspension and Initiation of Debarment Proceeding (Notice of
   Suspension) that was published in the Federal Register on November 7,
   2011. The Notice of Suspension suspended you from participating in
   activities associated with or relating to the E-Rate program and described
   the basis for initiating debarment proceedings against you, the applicable
   debarment procedures, and the effect of debarment.

   As discussed in the Notice of Suspension, as president and co-owner of CMS
   Internet LLC (CMS), you devised and participated in a scheme to defraud
   the E-Rate program, which resulted in a loss to the program of up to
   $70,000. Specifically, you made materially false representations that
   induced two school districts to steer E-rate contracts to CMS; and you
   paid the school applicants' share of E-Rate expenses with purported
   "donations" and "leasing payments." Furthermore, you failed to disclose
   that you purchased ineligible goods and services with E-Rate funds.
   Finally, you obstructed a 2007 federal grand jury investigation by
   instructing a CMS employee to testify falsely about receiving gifts and to
   destroy computer records. As a result of your conviction for wire fraud,
   the United States District Court for the Western District of Michigan
   sentenced you to serve 15 months in federal prison, followed by two years
   of supervised release for defrauding the E-Rate program. The court also
   prohibited you from "having any involvement with any government-backed or
   federally-regulated programs during the course of supervision." The court
   ordered you to pay a $12,000 criminal fine in addition to paying Universal
   Service Administration Company (USAC) $115,534 in restitution. Pursuant to
   Section 54.8(c) of the Commission's rules, your conviction of criminal
   conduct in connection with the E-Rate program serves as a basis for your

   In accordance with the Commission's debarment rules, you were required to
   file with the Commission any opposition to your suspension or its scope,
   or to your proposed debarment or its scope, no later than 30 calendar days
   from either the date of your receipt of the Notice of Suspension or of its
   publication in the Federal Register, whichever date occurred first. The
   Commission did not receive any such opposition.

   For the foregoing reasons, you are debarred from participating in the
   E-Rate program for three years from the Debarment Date. During this
   debarment period, you are excluded from participating in any activities
   associated with or related to the E-Rate program, including the receipt of
   funds or discounted services through the E-Rate program, or consulting
   with, assisting, or advising applicants or service providers regarding the
   E-Rate program.


   Theresa Z. Cavanaugh

   Acting Chief

   Investigations and Hearings Division

   Enforcement Bureau

   cc: Johnnay Schrieber, Universal Service Administrative Company (via

   Rashann Duvall, Universal Service Administrative Company (via e-mail)

   Jason C. Turner, Antitrust Division, United States Department of Justice
   (via email)

   Jennifer M. Dixton, Antitrust Division, United States Department of
   Justice (via email)

   Meagan D. Johnson, Antitrust Division, United States Department of Justice
   (via email)

   47 C.F.R. S: 54.8(g) (2010). See also 47 C.F.R. S: 0.111 (delegating
   authority to the Enforcement Bureau to resolve universal service
   suspension and debarment proceedings).

   Letter from Theresa Z. Cavanaugh, Acting Chief, Investigations and
   Hearings Division, Enforcement Bureau, Federal Communications Commission,
   to Jeremy R. Sheets, Notice of Suspension and Initiation of Debarment
   Proceeding, DA 11-1733, 26 FCC Rcd 14408 (Inv. & Hearings Div., Enf. Bur.
   2011) (Attachment 1).

   76 Fed. Reg. 68760  (Nov. 7, 2011).

   Notice of Suspension, 26 FCC Rcd at 14409.




   See United States v. Jeremy R. Sheets, Criminal Case No. 1:10-cr-380, 
   Judgment (W.D. Mi. 2011).

   Id. A condition of your supervised release includes forfeiting all
   monetary claims pending under contract with other E-Rate school
   applicants. Telephone Conversation with Jason Turner, Lead Counsel, Dep't
   of Justice, Antitrust Division (Aug. 10, 2011).

   Supra note 5.

   47 C.F.R. S: 54.8(c).

   Id. S:S: 54.8 (e)(3), (4). Any opposition had to be filed no later than
   November 17, 2011.

   Id. S:S: 54.8(e)(5), (g).

   47 C.F.R. S:S: 54.8(a)(1), (5), (d).

   Jeremy R. Sheets

   February 14, 2012

   Page 3



                               Enforcement Bureau

                      Investigations and Hearings Division