Click here for Adobe Acrobat version
Click here for Microsoft Word version
This document was converted from Microsoft Word.
Content from the original version of the document such as
headers, footers, footnotes, endnotes, graphics, and page numbers
will not show up in this text version.
All text attributes such as bold, italic, underlining, etc. from the
original document will not show up in this text version.
Features of the original document layout such as
columns, tables, line and letter spacing, pagination, and margins
will not be preserved in the text version.
If you need the complete document, download the
Microsoft Word or Adobe Acrobat version.
Federal Communications Commission
Washington, D.C. 20554
In the Matter of
J.J. MacKay Canada Ltd.
File No.: EB-SED-14-00014850
Acct. No.: 201432100019
NOTICE OF APPARENT LIABILITY FOR FORFEITURE
Adopted: May 12, 2014 Released: May 12, 2014
By the Chief, Spectrum Enforcement Division, Enforcement Bureau:
* WE PROPOSE A PENALTY OF $11,000 AGAINST J.J. MACKAY CANADA LTD. (MACKAY) FOR ITS APPARENTLY UNLAWFUL MARKETING OF A PARKING METER THAT CONTAINS A RADIO frequency device that had not been properly authorized and the user manual for which failed to disclose certain required information to consumers. We take this action as part of our duty to ensure that radio frequency devices marketed in the United States comply with the Commission's technical standards and other requirements so that they do not cause harmful interference to authorized radio communications.
* AS DISCUSSED BELOW, MACKAY'S MARKETING OF THE GUARDIAN SOLO SINGLE-SPACE PARKING METER (GUARDIAN SOLO) IN THE UNITED STATES APPARENTLY VIOLATED SECTION 302(B) OF COMMUNICATIONS ACT OF 1934, AS AMENDED (ACT); former Section 2.803(a) of the Commission's Rules (Rules); and current Sections 15.201(b) and 15.105(b) of the Rules.
* II. BACKGROUND
* MacKay designs, develops, and manufactures parking control products, including the Guardian SOLO. On August 23, 2013, the Enforcement Bureau (Bureau) received a complaint alleging that MacKay's Guardian SOLO was not properly authorized and that the device also did not comply with consumer disclosure requirements. In response to the complaint, the Bureau's Spectrum Enforcement Division (Division) issued a Letter of Inquiry (LOI) to MacKay on January 8, 2014, directing the company to submit a sworn written response to a series of questions relating to its marketing of the Guardian SOLO.
On March 10, 2014, MacKay responded to the LOI. According to MacKay, the Guardian SOLO is a "smart" parking meter that accepts electronic payments made with credit cards, smart cards, or Near Field Communications-enabled mobile device applications. In addition, the Guardian SOLO enables municipalities and other parking space operators to manage their parking resources by providing up-to-date electronic information about meter use and payments. MacKay explains that it obtained FCC certification in 2011 for the Guardian SOLO and that it continually refined the device's design; MacKay had assumed that the refinements, once implemented, would be considered "permissive changes" under the Rules. MacKay acknowledges, however, that one modification made in July 2012 -- i.e., the relocation of the antenna to improve the performance of the device's contactless reader -- increased the field strength rating previously authorized in the device's 2011 certification and, thereby, necessitated a new FCC certification for the device, which it received on April 5, 2013.
MacKay admits that it began marketing the modified device in the United States before it received the new FCC certification, but it asserts that none of the devices were actually sold. In addition, MacKay admits that the user manual accompanying the Guardian SOLO did not include the consumer disclosure language required by Section 15.105(b) of the Rules -- warning, among other things, that improper use of the device could cause potential harmful interference to radio communications -- until sometime in February 2014. MacKay claims, however, that its error was unintentional and that it was moving quickly to fix the error by adding appropriate text to the next version of its user manual and destroying all copies of the non-compliant manuals in its possession.
* III. DISCUSSION
* A. Marketing of Unauthorized Equipment
Pursuant to Section 302(b) of the Act, "[n]o 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." Former Section 2.803(a)(1) of the Rules -- which was effective during the relevant period here -- prohibited the marketing of radio frequency devices unless, in the case of a device subject to certification, the device has first been properly authorized, identified, and labeled in accordance with the Rules. Former Section 2.803(e)(4) of the Rules defined "marketing" as the "sale or lease, or offering for sale or lease, including advertising for sale or lease, or importation, shipment or distribution for the purpose of selling or leasing or offering for sale or lease." Furthermore, because the Guardian SOLO can be configured to use a variety of components that intentionally emit radio frequency energy, the device is classified as an intentional radiator. Pursuant to Section 15.201(b) of the Rules, an intentional radiator must be authorized in accordance with the Commission's certification procedures described in Sections 2.1031 - 2.1060 of the Rules prior to marketing.
The record in this case establishes that MacKay marketed the modified Guardian SOLO in the United States by offering the device for sale, distributing what it describes as "marketing materials" for the device, and shipping dozens of the modified devices to potential customers before obtaining FCC certification. Accordingly, we find that MacKay apparently willfully and repeatedly violated Section 302(b) of the Act, former Section 2.803(a)(1) of the Rules, and Section 15.201(b) of the Rules.
* B. Marketing of Radio Frequency Devices Without the Required Consumer Disclosure
The Guardian SOLO is classified as a Class B digital device. Pursuant to Section 15.105(b) of the Rules, the user manual for a Class B digital device must include a warning to consumers of the device's potential for causing interference to other radio communications and also provide a list of steps that could possibly eliminate the interference. Specifically, Section 15.105(b) of the Rules states that the user manual for Class B digital devices must include the following consumer disclosure language:
* Note: This equipment has been tested and found to comply with the limits for a Class B digital device, pursuant to part 15 of the FCC Rules. These limits are designed to provide reasonable protection against harmful interference in a residential installation. This equipment generates, uses and can radiate radio frequency energy and, if not installed and used in accordance with the instructions, may cause harmful interference to radio communications. However, there is no guarantee that interference will not occur in a particular installation. If this equipment does cause harmful interference to radio or television reception, which can be determined by turning the equipment off and on, the user is encouraged to try to correct the interference by one or more of the following measures:
* -- Reorient or relocate the receiving antenna.
* -- Increase the separation between the equipment and receiver.
* -- Connect the equipment into an outlet on a circuit different from that to which the receiver is connected.
* -- Consult the dealer or an experienced radio/TV technician for help.
It is undisputed that MacKay failed to provide the foregoing disclosure in the user manuals while it was actively marketing the Guardian SOLO. Indeed, in its LOI Response, MacKay admits that after it received the new certification for the Guardian SOLO, the user manual for the device did not include the consumer disclosure required by Section 15.105(b) of the Rules. Accordingly, we find that MacKay apparently willfully and repeatedly violated Section 302(b) of the Act, former Section 2.803(a)(1) of the Rules, and Section 15.105(b) of the Rules.
* C. Proposed Forfeiture
Section 503(b) of the Act provides that any person who willfully or repeatedly fails to comply substantially with the terms and conditions of any license, or willfully or repeatedly fails to comply with any of the provisions of the Act or of any rule, regulation, or order issued by the Commission thereunder, shall be liable for a forfeiture penalty. Section 312(f)(1) of the Act defines "willful" as the "conscious and deliberate commission or omission of [any] act, irrespective of any intent to violate" the law. The legislative history to Section 312(f)(1) of the Act clarifies that this definition of willful applies to both Sections 312 and 503(b) of the Act, and the Commission has so interpreted the term in the Section 503(b) context. The Commission may also assess a forfeiture for violations that are merely repeated, and not willful. The term "repeated" means the commission or omission of an act more than once or for more than one day. Based on the record before us, we conclude that MacKay is apparently liable for a forfeiture for its apparent willful and repeated violations of Section 302(b) of the Act, former Section 2.803(a)(1) of the Rules, and Sections 15.201(b) and 15.105(b) of the Rules.
In determining the appropriate forfeiture amount, Section 503(b)(2)(E) of the Act directs us to consider factors such as "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." Section 1.80(b) of the Rules sets a base forfeiture amount of $7,000 for the marketing of unauthorized equipment. The Commission typically imposes a $7,000 base forfeiture for marketing devices that do not comply with applicable technical requirements of the Rules or that are not authorized by an equipment authorization, as in this case. In addition, the Commission has determined that a base forfeiture of $4,000 is warranted for marketing devices that have been authorized, but have been marketed without the required consumer disclosures.
In applying the applicable statutory factors, we also consider whether there is any basis for a downward adjustment of the proposed forfeiture. Here, we find none. We decline to downwardly adjust the forfeiture on the grounds that MacKay's marketing efforts during the relevant period did not result in any actual sales of the Guardian SOLO. The fact that its marketing efforts did not result in the sale of the devices does not mitigate the violation because the term "marketing" expressly includes MacKay's activities: advertising, offers for sale, and shipment and distribution of the devices. Even if the majority of its marketing efforts occurred after the Guardian SOLO was properly authorized, as MacKay asserts, that does not excuse or mitigate any illegal marketing that took place before receiving FCC authorization. In addition, the fact that MacKay may have come into compliance with the consumer disclosure requirements approximately one month after the company received the LOI also does not warrant a reduction of the proposed forfeiture amount. As we have repeatedly stated, corrective measures implemented after the Commission has initiated an investigation or taken enforcement action do not nullify or mitigate past violations. Similarly, MacKay's assertion that the failure to include the required consumer language was "unintentional" does not justify a downward adjustment. As the Commission has held, violations resulting from inadvertent error are willful violations that generally do not warrant a downward adjustment of a proposed forfeiture.
Therefore, after applying the factors set forth in Section 503(b)(2)(E) of the Act, Section 1.80 of the Rules, and the Forfeiture Policy Statement to the instant case, we conclude that MacKay is apparently liable for a forfeiture in the amount of $11,000.
* IV. Ordering CLauses
Accordingly, IT IS ORDERED that, pursuant to Section 503(b) of the Act and Sections 0.111, 0.311 and 1.80 of the Rules, J.J. MacKay Canada Ltd. IS hereby NOTIFIED of its APPARENT LIABILITY FOR A FORFEITURE in the amount of eleven thousand dollars ($11,000) for willful and repeated violations of Section 302(b) of the Communications Act of 1934, as amended, former Section 2.803(a) of the Commission's rules, and Sections 15.201(b) and 15.105(b) of the Commission's rules.
IT IS FURTHER ORDERED that, pursuant to Section 1.80 of the Commission's rules, within thirty (30) calendar days of the release date of this Notice of Apparent Liability for Forfeiture, J.J. MacKay Canada Ltd. SHALL PAY the full amount of the proposed forfeiture or SHALL FILE a written statement seeking reduction or cancellation of the proposed forfeiture consistent with paragraph 18 below.
Payment of the forfeiture must be made by check or similar instrument, wire transfer, or credit card, and must include the NAL/Account number and FRN referenced above. J.J. MacKay Canada Ltd. shall send electronic notification of payment to Jennifer Burton at Jennifer.Burton@fcc.gov and JoAnn Lucanik at JoAnn.Lucanik@fcc.gov on the date said payment is made. Regardless of the form of payment, a completed FCC Form 159 (Remittance Advice) must be submitted. When completing the FCC Form 159, enter the Account Number in block number 23A (call sign/other ID) and enter the letters "FORF" in block number 24A (payment type code). Below are additional instructions that J.J. MacKay Canada Ltd. should follow based on the form of payment it selects:
* Payment by check or money order must be made payable to the order of the Federal Communications Commission. Such payments (along with the completed Form 159) must be mailed to Federal Communications Commission, P.O. Box 979088, St. Louis, MO 63197-9000, or sent via overnight mail to U.S. Bank - Government Lockbox #979088, SL-MO-C2-GL, 1005 Convention Plaza, St. Louis, MO 63101.
* Payment by wire transfer must be made to ABA Number 021030004, receiving bank TREAS/NYC, and Account Number 27000001. To complete the wire transfer and ensure appropriate crediting of the wired funds, a completed Form 159 must be faxed to U.S. Bank at (314) 418-4232 on the same business day the wire transfer is initiated.
* Payment by credit card must be made by providing the required credit card information on FCC Form 159 and signing and dating the Form 159 to authorize the credit card payment. The completed Form 159 must then be mailed to Federal Communications Commission, P.O. Box 979088, St. Louis, MO 63197-9000, or sent via overnight mail to U.S. Bank - Government Lockbox #979088, SL-MO-C2-GL, 1005 Convention Plaza, St. Louis, MO 63101.
Any request for making full payment over time under an installment plan should be sent to: Chief Financial Officer -- Financial Operations, Federal Communications Commission, 445 12th Street, SW, Room 1-A625, Washington, DC 20554. If J.J. MacKay Canada Ltd. has any questions regarding payment procedures, it should contact the Financial Operations Group Help Desk by phone, 1-877-480-3201, or by e-mail, ARINQUIRIES@fcc.gov.
The written statement seeking reduction or cancellation of the proposed forfeiture, if any, must include a detailed factual statement supported by appropriate documentation and affidavits pursuant to Sections 1.16 and 1.80(f)(3) of the Rules. The written statement must be mailed to the Office of the Secretary, Federal Communications Commission, 445 12th Street, S.W., Washington, DC 20554, ATTN: Enforcement Bureau - Spectrum Enforcement Division, and must include the NAL/Account Number referenced in the caption. The statement must also be e-mailed to Jennifer Burton at Jennifer.Burton@fcc.gov and JoAnn Lucanik at JoAnn.Lucanik@fcc.gov. 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.
IT IS FURTHER ORDERED that a copy of this Notice of Apparent Liability for Forfeiture shall be sent by first class mail and certified mail, return receipt requested, to George MacKay, President, J.J. MacKay Canada Ltd., 1342 Abercrombie Road, New Glasgow, Nova Scotia, Canada B2H 5C6, and to Patrick O'Donnell, Esquire, Wiltshire & Grannis, LLP, Counsel for J.J. MacKay Canada Ltd., 1200 18th Street, N.W., 12th Floor, Washington, DC 20036.
* FEDERAL COMMUNICATIONS COMMISSION
John D. Poutasse
Chief, Spectrum Enforcement Division