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Before the
Federal Communications Commission
Washington, D.C. 20554
In the Matter of )
)
Clegg Industries, Inc. ) File Number EB-05-ST-192
)
Torrance, California ) NAL/Acct. No.
) 200632980002
FRN:
0014417414
NOTICE OF APPARENT LIABILITY FOR FORFEITURE
Released: December
21, 2005
By the Acting District Director, Seattle District Office, Western
Region, Enforcement Bureau:
I. INTRODUCTION
1. In this Notice of Apparent Liability for Forfeiture
("NAL"), we find that Clegg Industries, Inc. (``Clegg'') in
Torrance, California, apparently repeatedly violated Section
302(b) of the Commissions Act of 1934, as amended (``Act''),1
and Section 2.803(a)(2) of the Commission's Rules (``Rules'')2
by importing and marketing non-authorized radio frequency
devices. We conclude, pursuant to Section 503(b) of the Act,3
Clegg is apparently liable for a forfeiture in the amount of
seven thousand dollars ($7,000).
II. BACKGROUND
2. On April 10, 2005, a Western Region agent purchased a
``Space Needle'' FM radio at the Space Needle gift shop in
Seattle, Washington. The agent noticed that the radio lacked
any labeling as required by Section 15.19(a)(1) of the Rules. 4
The unit was turned over to the Seattle District Office for
further investigation.
3. On May 18, 2005, Seattle agents visited the Space
Needle gift shop and found a number of the ``Space Needle''
model radios for sale. The agents interviewed the sales
supervisor, and advised her that the Commission required that
certain labeling be placed on the devices prior to sale. The
sale supervisor had the ``Space Needle'' model radios removed
from the shelves.
4. On June 16, 2005, the Seattle office issued a Letter of
Inquiry (``June 16, 2005 LOI'') to the Space Needle Corporation
requesting information about the ``Space Needle'' model radio
and the radios' importer. On June 24, 2005, the Seattle office
received a response from the Space Needle Corporation to the
June 16, 2005 LOI. The response stated that the importer of
the radios was Clegg Industries, Inc. located in Torrance
California and that they had received a shipment of the radios
from Clegg on March 29, 2005. The response also indicated that
the Space Needle Corporation had ceased offering for sale the
``Space Needle'' model radios on May 18, 2005 and had returned
the radios to Clegg for a refund.
5. On July 15, 2005, the Seattle Office issued a Letter of
Inquiry (``July 15, 2005 LOI'') to Clegg requesting information
about the ``Space Needle'' model radios. Specifically, the
Seattle Office asked when importation of the radios began, how
many had been imported, and whether a verification report for
the ``Space Needle'' model existed. On August 8, 2005, the
Seattle Office received a response from Clegg to the July 15,
2005 LOI. The response included a copy of the ``FCC - Test
Report from International Electrical Certification Centre
(``IECC'') Ltd.,'' which was performed at the request of the
manufacturer, Zonotec Industrial Co. Ltd and concluded that the
``Space Needle'' model radio complied with the FCC's Part 15
Rules. The verification report indicated that IECC received a
sample radio for testing on July 27, 2005 and conducted the
testing on August 2, 2005 The response also indicated that
Clegg Industries had issued a credit to the Space Needle
Corporation for the subject radios. The response did not
indicate when importation of the radios began or how many of
the radios had been imported.
III. DISCUSSION
6. 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 there under,
shall be liable for a forfeiture penalty. The term ``willful''
as used in Section 503(b) has been interpreted to mean simply
that the acts or omissions are committed knowingly.5 The term
``repeated'' means the commission or omission of such act more
than once or for more than one day.6
7. Section 302(b) of the Act provides that ``[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.''7 Section 2.803(a)(2) of the Rules
provides that ``[e]xcept as provided elsewhere in this section,
no person shall sell or lease, or offer for sale or lease
(including advertising for sale or lease), or import, ship, or
distribute for the purpose of selling or leasing or offering
for sale or lease, any radio frequency device unless ... [i]n
the case of a device that is not required to have a grant of
equipment authorization issued by the Commission, but which
must comply with the specified technical standards prior to
use, such device also complies with all applicable
administrative (including verification of the equipment or
authorization under a Declaration of Conformity, where
required), technical, labeling and identification requirements
specified in this chapter.''8
8. Section 15.3(z) of the Rules9 states that FM Broadcast
receivers are unintentional radiators. Section 15.101 of the
Rules,10 requires that unintentional radiators shall be
authorized prior to initiation of marketing and in the case of
FM Broadcast receivers, the required authorization is
verification. Section 15.19(a)(1) of the Rules states that
receivers associated with a licensed radio service, in this
case, the FM Broadcast service, shall bear the following
statement in a conspicuous location on the device:
``This device complies with part 15 of the FCC Rules.
Operation is subject to the condition that this device does
not cause harmful interference.''11
9. The ``Space Needle'' model radios sold by the Space
Needle Corporation, were purchased from the importer Clegg
Industries Inc. in March 2005. As the importer of the devices,
Clegg is deemed the responsible party, as defined in Section
2.909 of the Rules and, as such, is required to maintain the
records listed in Section 2.955 of the Rules, including the
testing information that demonstrates the device's compliance
with the verification requirements.12 Clegg's August 8, 2005
response to the Seattle Office's July 15, 2005 LOI included a
copy of a verification report for the ``Space Needle'' model
radio. The verification report indicated that the testing
laboratory received a sample radio for testing on July 27, 2005
and conducted the testing on August 2, 2005, indicating that
the testing was performed following Clegg's receipt of the July
15, 2005 LOI.
10. Clegg imported and marketed the ``Space Needle''
model radios in March 2005, several months prior to their
verification. Additionally, the units did not have the
required labeling. The violation occurred on more than one
day, therefore, it was repeated. Based on the evidence before
us, we find that Clegg apparently repeatedly violated Section
302(b) of the Act and Section 2.803(a)(2) of the Rules by
importing and marketing a non-authorized radio frequency
device.
11. Pursuant to The Commission's Forfeiture Policy
Statement and Amendment of Section 1.80 of the Rules to
Incorporate the Forfeiture Guidelines, ("Forfeiture Policy
Statement"), and Section 1.80 of the Rules,13 the base
forfeiture amount for importing or marketing unauthorized
equipment is $7,000.14 In assessing the monetary forfeiture
amount, we must also 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 violations,
and with respect to the violator, the degree of culpability,
and history of prior offenses, ability to pay, and other such
matters as justice may require.15 Applying the Forfeiture
Policy Statement, Section 1.80, and the statutory factors to
the instant case, we conclude that Clegg is apparently liable
for a $7,000 forfeiture.
12. A review of Clegg's website reveals that Clegg also
imports and markets at least six other models of FM receivers
that do not appear to have an FCC authorization.16 Therefore,
we will require Clegg to file a report with the Acting District
Director of the Seattle Office detailing, for each of the
models imported and marketed by Clegg, how each model complies
with the authorization and verification requirements of Section
2.803 of the Rules, and the labeling requirements of Section
15.19 of the Rules.
IV. ORDERING CLAUSES
13. Accordingly, IT IS ORDERED that, pursuant to Section
503(b) of the Communications Act of 1934, as amended, and
Sections 0.111, 0.311, 0.314 and 1.80 of the Commission's
Rules,17 Clegg Industries, Inc. is hereby NOTIFIED of this
APPARENT LIABILITY FOR A FORFEITURE in the amount of seven
thousand dollars ($7,000) for repeatedly violating Section
302(b) of the Act, and Section 2.803(a)(2) of the Rules.
14. IT IS FURTHER ORDERED that, pursuant to Section 1.80
of the Commission's Rules, within thirty days of the release
date of this Notice of Apparent Liability for Forfeiture, Clegg
Industries, Inc. SHALL PAY the full amount of the proposed
forfeiture or SHALL FILE a written statement seeking reduction
or cancellation of the proposed forfeiture.
15. IT IS FURTHER ORDERED that Clegg Industries SHALL
FILE, within thirty (30) days of the release of this Notice, a
report with the Acting District Director, Seattle Office,
concerning Clegg Industries Inc.'s efforts to comply with the
Commission's authorization, verification and labeling Rules,
as detailed above.
16. 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 above. 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 Bank, and account
number 911-6106.
17. The response, if any, must be mailed to Federal
Communications Commission, Enforcement Bureau, Western Region,
Seattle District Office, 11410 NE 122nd Way, Suite 312,
Kirkland, Washington 98034-6927 and must include the NAL/Acct.
No. referenced in the caption.
18. 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
("GAAP"); 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 submitted.
19. Requests for payment of the full amount of this
Notice of Apparent Liability under an installment plan should
be sent to: Associate Managing Director - Financial Operations,
Room 1A625, 445 12th Street, S.W., Washington, D.C. 20554.18
20. IT IS FURTHER ORDERED that a copy of this Notice of
Apparent Liability for Forfeiture shall be sent by Certified
Mail, Return Receipt Requested, and regular mail, Clegg
Industries Inc., at its address of record.
FEDERAL COMMUNICATIONS COMMISSION
Kristine A. McGowan
Acting District Director
Seattle District Office
Western Region
Enforcement Bureau
_________________________
147 U.S.C. § 302a(b).
247 C.F.R. § 2.803(a)(2).
347 U.S.C. § 503(b).
447 C.F.R. § 15.19(a)(1).
5Section 312(f)(1) of the Act, 47 U.S.C. § 312(f)(1), which
applies to violations for which forfeitures are assessed under
Section 503(b) of the Act, provides that "[t]he term 'willful',
when used with reference to the commission or omission of any
act, means the conscious and deliberate commission or omission of
such act, irrespective of any intent to violate any provision of
this Act or any rule or regulation of the Commission authorized
by this Act...." See Southern California Broadcasting Co., 6 FCC
Rcd 4387 (1991).
6Section 312(f)(2) of the Act, 47 U.S.C. § 312(f)(2), which also
applies to violations for which forfeitures are assessed under
Section 503(b) of the Act, provides that "[t]he term 'repeated',
when used with reference to the commission or omission of any
act, means the commission or omission of such act more than once
or, if such commission or omission is continuous, for more than
one day.''
747 U.S.C. § 302a(b).
847 C.F.R. § 2.803(a)(2).
947 C.F.R. § 15.3(z).
10 47 C.F.R. § 15.101(a).
1147 C.F.R. § 15.19(a)(1).
1247 C.F.R. §§ 2.909, 2.955.
1347 C.F.R. § 1.80.
1412 FCC Rcd 17087 (1997), recon. denied, 15 FCC Rcd 303 (1999);
47 C.F.R. §1.80.
1547 U.S.C. § 503(b)(2)(D).
16 See http://www.cleggonline.com/
1747 C.F.R. §§ 0.111, 0.311, 0.314, and 1.80.
18See 47 C.F.R. § 1.1914.