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                            Before the
                Federal Communications Commission
                      Washington, D.C. 20554

In the Matter of                )  File No. EB -00-IH-0053
America's Tele-Network Corp.    )  NAL/Acct. No. x32080024


   Adopted: July 27, 2000               Released:  August 1, 

By the Commission:

                      I.  INTRODUCTION

     1.  In this Notice of Apparent Liability for Forfeiture 
("NAL"), we find that America's Tele-Network Corp. 
(``ATNC'') has apparently violated section 254(d) of the 
Communications Act of 1934, as amended (the ``Act''), and 
section 54.706 of the Commission's rules by willfully and 
repeatedly failing to contribute to universal service 
support programs. 1  Based on our review of the facts and 
circumstances in this case, we conclude that ATNC is 
apparently liable for a forfeiture in the amount of one 
hundred fifty-four thousand dollars ($154,000).

                       II.  BACKGROUND

     2.  In 1996, Congress amended the Act to require that:

     Every telecommunications carrier that provides 
     interstate telecommunications services shall 
     contribute, on an equitable and nondiscriminatory 
     basis, to the specific, predictable, and 
     sufficient mechanisms established by the 
     Commission to preserve and advance universal 
In implementing section 254, the Commission authorized the 
Universal Service Administrative Company (``USAC'') to 
administer universal service support mechanisms and to 
perform billing and collection functions.3  As to these 
matters, the Commission directed USAC to distribute, receive 
and process the Universal Service Worksheet (now the 
Telecommunications Reporting Worksheet) (``Worksheet''), 
which is used to report certain categories of revenue for 
the purpose of calculating a carrier's universal service 
contribution, and to adjust carriers' contributions in 
accordance with factors established by the Commission.4  In 
addition, the Commission gave USAC the authority to bill carriers monthly, with the first 
payment being due in February 1998.5  To foster compliance 
with universal service requirements, the Commission's rules 
provide that a carrier's failure ``to submit required . . . 
contributions may subject the contributor to the enforcement 
provisions of the Act and any other applicable law.''6   

     3.  ATNC filed its first Worksheet in February 1998.  
Based upon information in the Worksheet, USAC sent ATNC an 
invoice dated February 25, 1998, which set forth ATNC's 
liability to the universal service funds for high cost and 
low income areas, school and libraries, and rural health 
care.  The invoice stated that payment of the contribution, 
which at that time totaled $45,637.44, was due by March 17, 
1998.  ATNC failed to submit the required contribution.  
Beginning in March 1998,7 USAC repeatedly contacted ATNC and 
informed ATNC of its delinquency in making universal service 
contributions.  Notwithstanding USAC's invoices and repeated 
contacts, ATNC made no payments in 1998 or 1999.

     4.  ATNC's apparent recalcitrance continued into 2000.  
In February 2000, the Enforcement Bureau sent a letter to 
ATNC, which explained that ATNC was the subject of a 
potential enforcement action.8  In its response, ATNC 
expressly stated that it was ``withholding payments'' due to 
its belief that ``universal service support programs and 
contribution assessments are unconstitutional and invalid,'' 
despite acknowledging that the U.S. Court of Appeals for the 
Fifth Circuit had found otherwise. 9  In subsequent 
responses to further staff inquiries,10 ATNC claimed, among 
other things, that its non-payment occurred because its 
customers failed to pay specific line item charges for 
universal service.11  Nonetheless, ATNC acknowledged that it regularly received from its billing agent a pre-set 
percentage of the amounts billed to customers and that the 
billed amounts included the universal service line item.12  

     5.  Notwithstanding its arguments seeking to justify 
its prior failures to pay, ATNC submitted to USAC a 
contribution of $208,984.58 on May 8, 2000, and two 
additional contributions of $48,051.38 and $10,000 on June 
6, 2000.  On July 18, 2000, USAC received from ATNC another 
payment of $56,962.76.  Accounting for ATNC's most recent 
payments, ATNC currently owes $964,808.52, which consists of 
required contributions and late payment penalties billed 
through June 2000.        

                      III.  DISCUSSION

     6.  We conclude that ATNC is apparently liable for 
forfeiture for willful and repeated violations of section 
254 of the Act and the Commission's rules governing 
universal service contributions.  From February 1998 until 
May 2000, ATNC failed to pay any portion of its universal 
service obligations.  Beginning in May 2000, ATNC has paid a 
little more than 25 percent of the total amount owed.  As 
noted above, section 254(d) of the Act and sections 54.706 
and 54.709 of the Commission's rules require that interstate 
telecommunications carriers make universal service 
contributions in the amount calculated by USAC. 13  We find 
that ATNC's failure to make the required contributions is 
both willful and repeated.  The term ``willful'' means that 
the violator knew that it was taking the action in question, 
irrespective of any intent to violate the Commission's 
rules,14 and ``repeated'' means more than once.15  
Considering the record before us, it appears that ATNC was 
not only aware of its obligation to contribute to universal 
service programs, it deliberately chose not to meet that 

     7.  Section 503(b)(1)(B) of the Act provides that any 
person who willfully or repeatedly fails to comply with the 
Act or the Commission's rules shall be liable for a 
forfeiture penalty.16  Section 503(b)(2)(B) of the Act 
authorizes the Commission to assess a forfeiture of up to 
$110,000 for each violation, or each day of a continuing 
violation, up to a statutory maximum of $1,100,000 for a 
single act or failure to act.17  In assessing a forfeiture, 
we 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 such other 
matters as justice may require.18  

     8.  Although ATNC's delinquency has continued since 
March 1998, we limit the scope of this NAL to ATNC's 
apparent failures to make the contributions assessed in USAC 
invoices for November and December 1999, each of which 
sought a monthly contribution of $62,671.52 for the 
universal service programs. Although, in the past, we have 
sanctioned carriers for failure to make the required 
universal service contributions for only one month of a 
continuing violation, we expressly stated that: 

     [I]n light of the accumulating record of non-
     compliance, we are prepared to impose 
     substantially greater forfeitures in the future. . 
     . .  [O]ur future notices likely will cover 
     greater periods of non-payment than a single month 
     . . . [and] will be based on some variant of [our] 
     formula, which includes, as a component of the 
     forfeiture, one half of the unpaid contribution 
     amount for the period in question.19   

     9.  Taking into account the factors listed in section 
503(b)(2)(D) of the Act,20 as well as Commission precedent, 
we find ATNC apparently liable for a forfeiture of $154,000.  
This forfeiture consists of three components.  First, we 
have assessed a base figure of $40,000 as a general penalty 
of $20,000 for each of the two violations at issue.21  As we 
noted in the ConQuest Forfeiture Order, it is necessary to 
set a base figure designed to deter delinquencies regardless 
of their amount.22  Second, consistent with the ConQuest 
Forfeiture Order, we have added to the base amount of 
$40,000 an amount equal to one half of the unpaid $125,442 
universal service contributions for the months of November 
and December 1999, or an addition of $62,671.23  We have 
imposed this component of the forfeiture to illustrate that 
a delinquent carrier's culpability and the consequential 
damage it causes to the goal of universal service may vary 
with the size of the contributions it fails to make.24  
Finally, as explained in greater detail below, because we 
believe that ATNC's violations are both egregious and 
intentional, we have applied an upward adjustment of 
$51,329, slightly less than 50 percent of the sum of the 
first two components.     10.  The Act and Commission's rules provide a framework 
for adjusting the forfeiture amounts imposed depending on 
the facts and circumstances of the particular case.25  Here, 
it appears that ATNC deliberately chose for more than two 
years to pay nothing toward universal service.  During that 
period, ATNC failed to respond to USAC's invoices, telephone 
calls and letters.  Moreover, even after the Commission 
notified ATNC of potential enforcement action, ATNC 
initially sought to justify its failures to pay by arguing 
that the universal service program was unconstitutional even 
while acknowledging that the only court decision it 
referenced had concluded otherwise.  Subsequently, in 
responding to a staff inquiry, ATNC shifted its defense by 
claiming that its failures to pay resulted from a notice 
appearing on LEC bills stating that non-payment of long 
distance charges would not result in interruption of local 
service.  ATNC asserts that this notice encouraged customers 
either to withhold payment of charges imposed on behalf of 
ATNC, or to seek refunds of such charges.  While it appears 
that some customers may have withheld payment or sought 
refunds, it also appears that ATNC received substantial 
income from its billing agent on a regular basis.  Only when 
it appeared that enforcement action was imminent did ATNC 
start making payments.  However, even then, ATNC made no 
commitment to pay off its arrearage, and its current payment 
pattern provides no assurance that it will do so any time in 
the foreseeable future.  In sum, it appears that ATNC's 
failures to pay, prior to May 2000, were in defiant 
disregard of its obligations.  Moreover, while ATNC's recent 
payments have been encouraging, its efforts to shift to 
others the blame for its apparent violations and the absence 
of a plan to eliminate its arrearage, reflect a continued 
disregard for its universal service obligations.  In this 
regard, we emphatically reject ATNC's attempt to blame 
others for its failures to contribute to universal service.   
     11.  Although ATNC's failure to make payment in other 
months represents independent violations of the Act and our 
rules, we do not find apparent liability for these apparent 
violations at this time.  Nevertheless, we note that these 
violations could form the basis for additional notices of 
apparent liability.26  If ATNC continues to violate our 
universal service rules, such violations could result in 
future NALs proposing substantially greater forfeitures, or 
could result in issuance of a show cause order to revoke 
ATNC's operating authority.27  
                    IV.  ORDERING CLAUSES

     12.  Accordingly, IT IS ORDERED THAT, pursuant to 
section 503(b) of the Act,28 and section 1.80 of the 
Commission's rules,29 America's Tele-Network Corp. is hereby 
amount of one hundred fifty-four thousand dollars ($154,000) 
for violating the Act and the Commission's rules requiring 
regular contributions for universal service. 

     13.  IT IS FURTHER ORDERED THAT, pursuant to section 
1.80 of the Commission's rules,30 within thirty days of this 
NOTICE OF APPARENT LIABILITY, America's Tele-Network Corp. 
SHALL PAY the full amount of the proposed forfeiture or 
SHALL FILE a written statement seeking reduction or 
cancellation of the proposed forfeiture.

     14.  Payment of the forfeiture may be made by credit 
card through the Commission's Credit and Debt Management 
Center at (202) 418-1995 or by mailing a check or similar 
instrument, payable to the order of the Federal 
Communications Commission, to the Forfeiture Collection 
Section, Finance Branch, Federal Communications Commission, 
P.O. Box 73482, Chicago, Illinois 60673-7482.  The payment 
should note the NAL/Acct. No. referenced above.

     15.  The response, if any, must be mailed to the 
Federal Communications Commission, Enforcement Bureau, 
Investigations and Hearings Division, 445 12th Street, S.W., 
Washington, D.C. 20554 and MUST INCLUDE THE NAL/Acct. No. 
referenced above.  

     16.  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 

     17.  Requests for payment of the full amount of this 
Notice of Apparent Liability under an installment plan 
should be sent to: Chief, Credit and Debt Management Center, 
445 12th Street, S.W., Washington, D.C. 20554.31  

     18.  IT IS FURTHER ORDERED THAT a copy of this NOTICE 
OF APPARENT LIABILITY shall be sent by Certified Mail Return 
Receipt Requested to America's Tele-Network Corp. in care of 
Charles H. Helein, Esq., The Helein Law Group, P.C., 8180 
Greensboro Drive, Suite 700, McLean, Virginia 22102, and to 
720 Hembree Place, Roswell, Georgia 30076, attention: John 
W. Little.



                         Magalie Roman Salas

1  47 U.S.C.  254(d); 47 C.F.R.  54.706.

2  47 U.S.C.  254(d). 

3  See Amendment of Parts 54 and 69 - Changes to Board of 
NECA, Inc., 12 FCC Rcd 18400, 18415 (1997) (``NECA Changes 
Order''); 47 C.F.R.  54.702(b).

4  See NECA Changes Order, 12 FCC Rcd at 18424-25; 47 C.F.R. 
 54.709(a)(1-3), 54.711(a). 

5  See Amendment of Part 54 - Universal Service, 12 FCC Rcd 
22423, 22425 (1997); 47 C.F.R.  54.709(a)(4-5). 

6  47 C.F.R.  54.713. 

7  USAC's records reflect a total of 17 contacts or 
attempted contacts between March 1998 and February 2000. 

8  Letter from David H. Solomon, Chief, Enforcement Bureau, 
to America's Tele-Network Corp. dated February 16, 2000. 

9  Letter from Charles H. Helein, Esq., counsel for ATNC, to 
James W. Shook, Investigations and Hearings Division, 
Enforcement Bureau, dated February 25, 2000, citing Texas 
Office of Public Utility Counsel v. FCC, 183 F.3d 393 (5th 
Cir. 1999) (subsequent history omitted).

10  Letter from David H. Solomon, Chief, Enforcement Bureau, 
to America's Tele-Network Corp. dated April 20, 2000.  
Letter from David H. Solomon, Chief, Enforcement Bureau, to 
America's Tele-Network Corp. dated May 3, 2000. 

11  Letter from John W. Little, President, to Charles W. 
Kelley, Chief, Investigations and Hearings Division, 
Enforcement Bureau, dated April 28, 2000.  Letter from 
Charles H. Helein, Esq., counsel for ATNC, to Charles W. 
Kelley, Chief, Investigations and Hearings Division, 
Enforcement Bureau, dated May 15, 2000.  

12  Documentation supplied by ATNC and its billing agent 
indicates that ATNC does not bill its customers directly.  
Rather, ATNC sells its customer accounts to the billing 
agent, which pays ATNC roughly 70 percent of the gross 
amount ATNC's customers will be billed for its service 
(amounts, which, according to ATNC's Worksheets, exceeded 
millions of dollars for calendar years 1998 and 1999).  The 
billing agent, in turn, sells the accounts to the local 
exchange carriers (LECs) whose customers use ATNC.  The LECs 
bill their own customers and include ATNC's charges.  On a 
regular basis, ATNC and its billing agent adjust the amounts 
to be paid to ATNC according to the amounts actually paid to 
the LECs (and then by the LECs to the billing agent) with 
respect to the charges assessed on behalf of ATNC.

13  47 U.S.C. 254(d); 47 C.F.R.  54.706, 54.709. 

14  See Jerry Szoka, 14 FCC Rcd 9857, 9865 (1999); Southern 
California Broadcasting Co., 6 FCC Rcd 4387 (1991). 

15  See Hale Broadcasting Corp., 79 FCC 2d 169, 171 (1980). 

16  47 U.S.C.  503(b)(1)(B); 47 C.F.R.  1.80(a)(2). 

17  47 U.S.C.  503(b)(2)(B); 47 C.F.R.  1.80(b)(2). 

18  47 U.S.C.  503(b)(2)(D).  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, 17100-01 (1997), recon. denied, 15 FCC Rcd 303 
(1999) (``Forfeiture Guidelines''). 

19  ConQuest Operator Services Corp., 14 FCC Rcd 12518, 
12528 (1999) (``ConQuest Forfeiture Order'').  See also 
Intellicall Operator Services, FCC 00-261, released July 27, 
2000 (Notice of Apparent Liability); Matrix Telecom, Inc., 
FCC 00-262, released July 27, 2000 (Notice of Apparent 

20  47 U.S.C.  503(b)(2)(D). 

21  See ConQuest Forfeiture Order, 14 FCC Rcd at 12527 (The 
Commission determined that $20,000 should be the general 
penalty for failure to pay the assessed universal service 
contribution in a timely manner). 

22  See id.

23  Id. 

24  See id., at  19. 

25  See 1.80(b)(4) of the Commission's rules and 
accompanying note, 47 C.F.R. 1.80(b)(4).  See also 
Forfeiture Guidelines, 12 FCC Rcd at 17100-01 (``[T]he 
adjustment factors we evaluate in considering the actions of 
the violator include egregious misconduct, ability or 
inability to pay, intentional violations, prior violation of 
the same or other requirements, good faith or voluntary 
disclosure, and history of overall compliance.  47 U.S.C.  
503(b)(2)(D).  In sum, although the base amount is the 
starting point in assessing a forfeiture, the forfeiture may 
be decreased below the base amount or increased to the 
statutory maximum when the adjustment criteria are 
considered based on the facts of the case''). 

26  ConQuest Forfeiture Order, 14 FCC Rcd at 12527. 

27  See CCN, Inc. et al., 12 FCC Rcd 8547 (1997) (the 
``Fletcher Companies'').

28  47 U.S.C.  503.

29  47 C.F.R.  1.80.

30  Id. 

31 See 47 C.F.R.  1.1914.