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Before the
Federal Communications Commission
Washington, D.C. 20554
)
In the Matter of File No. EB 07-SE-189
)
Dakota Central Telecommunications NAL/Acct. No.
Cooperative ) 200832100040
Carrington, North Dakota ) FRN # 0003759917
)
NOTICE OF APPARENT LIABILITY FOR FORFEITURE
Adopted: April 14, 2008 Released: April 16, 2008
By the Chief, Spectrum Enforcement Division, Enforcement Bureau:
I. INTRODUCTION
1. In this Notice of Apparent Liability for Forfeiture ("NAL"), we
propose a forfeiture against Dakota Central Telecommunications
Cooperative ("Dakota Central"), licensee of a Broadband Radio Service
("BRS") system and lessee of Educational Broadband Service ("EBS")
frequencies in the Brush Hill, North Dakota area, in the amount of
fifteen thousand dollars ($15,000) for operating on three EBS
channels without Commission authorization. Dakota Central acted in
apparent willful and repeated violation of Section 301 of the
Communications Act of 1934, as amended, ("Act") and Section 1.903(a)
of the Commission's Rules ("Rules").
II. BACKGROUND
2. Dakota Central is a telecommunications cooperative that provides
multichannel video programming distribution ("MVPD") and high-power
wireless broadband services over licensed BRS and leased EBS spectrum
to customers in rural North Dakota. On April 17, 2007, Dakota Central
voluntarily disclosed to the Wireless Telecommunications Bureau
("Wireless Bureau") that it had been transmitting video programming on
EBS channel C2 since approximately 1994, and had been providing
broadband access on EBS channels C3 and D3 since 2001, without
Commission authority. On April 24, 2007, Dakota Central filed a
request for Special Temporary Authority ("STA") seeking authority to
utilize EBS channels C2, C3, and D3 to continue providing its MVPD and
broadband services.
3. The Wireless Bureau subsequently referred this matter to the
Enforcement Bureau for investigation and possible enforcement action.
On August 23, 2007, the Enforcement Bureau's Spectrum Enforcement
Division issued a letter of inquiry ("LOI") to Dakota Central seeking
information regarding its operation of the channels.
4. In its September 21, 2007 response to the LOI, Dakota Central states
that it was unaware of this unauthorized activity until March 2007,
when Dakota Central retained counsel to assess its spectrum needs.
After reviewing Dakota Central's records, counsel informed Dakota
Central that it apparently was operating on three channels (EBS
Channels C2, C3 and D3) for which it was not authorized. Dakota
Central admits that it has transmitted video programming on EBS
Channel C2 continuously since 1994, and has provided broadband service
on EBS Channels C3 and D3 continuously since 2001. Dakota Central
believes that this unauthorized operation was caused by two different
employees, and asserts that, upon learning of this unauthorized
activity, it immediately took steps to obtain Commission authority to
operate. It met with Wireless Bureau staff to disclose the violation,
filed an STA to request authority to operate, filed a request for
waiver of certain related Commission's rules, conducted an audit of
its BRS licenses and EBS leases, and took specific steps to ensure
future compliance with the Commission's Rules. Dakota Central also
claims to have a long history of compliance with the Commission's
Rules.
III. DISCUSSION
5. Section 301 of the Act prohibits the general use or operation of any
apparatus for the transmission of energy or communications or signals
by a radio except under, and in accordance with, a Commission granted
authorization. Section 1.903(a) of the Rules provides, in pertinent
part, that stations in the wireless station service must be operated
with a valid Commission authorization.
6. Under Section 503(b)(1)(B) of the Act, any person who is determined by
the Commission to have willfully or repeatedly failed 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 forfeiture
penalty. To impose such a forfeiture penalty, the Commission must
issue a notice of apparent liability and the person against whom such
notice has been issued must have an opportunity to show, in writing,
why no such forfeiture penalty should be imposed. The Commission will
then issue a forfeiture if it finds by a preponderance of the evidence
that the person has violated the Act or a Commission rule.
7. Dakota Central admits that it has been operating on one of the EBS
channels without authority since 1994 and on two of the EBS channels
without authority since 2001. As detailed below, we find that Dakota
Central apparently willfully and repeatedly violated Section 301 of
the Act and Section 1.903(a) of the Rules by operating on three EBS
channels without Commission authorization.
8. Section 1.80 of the Rules establishes a base forfeiture amount of
$4,000 for unauthorized use of a frequency. Section 503(b)(2)(C) of
the Act, however, authorizes the Commission to assess against an
entity that is neither a broadcaster nor a common carrier a maximum
forfeiture of $11,000 for each violation, or each day of a continuing
violation, up to a statutory maximum forfeiture of $97,500 for any
single continuing violation. In determining the appropriate forfeiture
amount, Section 503(b)(2)(E) of the Act directs the Commission 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."
9. Section 503(b)(6) of the Act bars the Commission from proposing a
forfeiture for apparent violations that occurred more than one year
prior to the date of this NAL, but does not prohibit us from assessing
whether Dakota Central's conduct prior to that time period apparently
violated the provisions of the Act and Rules and from considering such
conduct in determining the appropriate forfeiture amount for
violations that occurred within the one-year statutory period.
Therefore, the forfeiture amount proposed herein takes into account
the continuing nature of Dakota Central's apparent violations, but
relates to the company's operation of the three channels within the
last year.
10. Consistent with precedent, we find that Dakota Central's unauthorized
use of the three channels constitutes separate and continuing
violations, warranting the assessment of separate base forfeiture
amounts. Having weighed the statutory factors enumerated above, we
find that the circumstances presented warrant an upward adjustment of
the aggregate base forfeiture amount of $12,000 ($4,000 for each of
the three unauthorized channels used).
11. Specifically, the record establishes that Dakota Central has
transmitted video programming on EBS Channel C2 continuously since
1994, and has operated broadband service on EBS Channels C3 and D3
continuously since 2001. Given that Dakota Central's apparent
violation spanned a significant period, we find it appropriate to
upwardly adjust the $4,000 base forfeiture amount to $6,000 for each
of Channels C3 and D3, and $8,000 for Channel C2, resulting in an
aggregate proposed forfeiture in the amount of $20,000 for Dakota
Central's willful and repeated violations of Section 301 of the Act
and Section 1.903(a) of the Rules.
12. Finally, we find, however, that a downward adjustment of the proposed
forfeiture from $20,000 to $15,000 is warranted. Specifically, we find
the downward adjustment to be appropriate based on Dakota Central's
voluntary disclosures of the violations to Commission staff prior to
any Commission inquiry or initiation of enforcement action, and
because, outside of the subject violations, Dakota Central has a prior
history of compliance.
IV. ORDERING CLAUSES
13. 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, Dakota Central
Telecommunications Cooperative IS hereby NOTIFIED of its APPARENT
LIABILITY FOR A FORFEITURE in the amount of fifteen thousand dollars
($15,000) for willfully and repeatedly violating Section 301 of the
Act and Section 1.903(a) of the Rules.
14. IT IS FURTHER ORDERED that, pursuant to Section 1.80 of the Rules,
within thirty days of the release date of this Notice of Apparent
Liability for Forfeiture, Dakota Central Telecommunications
Cooperative SHALL PAY the full amount of the proposed forfeiture or
SHALL FILE a written statement seeking reduction or cancellation of
the proposed forfeiture.
15. 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/Account Number and FRN Number referenced
above. Payment by check or money order may be mailed to Federal
Communications Commission, P.O. Box 979088, St. Louis, MO 63197-9000.
Payment by overnight mail may be sent to U.S. Bank - Government
Lockbox #979088, SL-MO-C2-GL, 1005 Convention Plaza, St. Louis, MO
63101. Payment by wire transfer may be made to ABA Number 021030004,
receiving bank TREAS/NYC, and account number 27000001. For payment by
credit card, an FCC Form 159 (Remittance Advice) must be submitted.
When completing the FCC Form 159, enter the NAL/Account number in
block number 23A (call sign/other ID), and enter the letters "FORF" in
block number 24A (payment type code). Requests for full payment under
an installment plan should be sent to: Chief Financial Officer --
Financial Operations, 445 12th Street, S.W., Room 1-A625, Washington,
D.C. 20554. Please contact the Financial Operations Group Help Desk at
1-877-480-3201 or Email: ARINQUIRIES@fcc.gov with any questions
regarding payment procedures.
16. The response, if any, must be mailed to the Office of the Secretary,
Federal Communications Commission, 445 12th Street, S.W., Washington,
D.C. 20554, ATTN: Enforcement Bureau - Spectrum Enforcement Division,
and must include the NAL/Acct. No. referenced in the caption.
17. 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; 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.
18. 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 Dakota Central's counsel, Stephen E.
Coran, Esq., 1615 L Street, N.W., Suite 1325, Washington DC 20036.
FEDERAL COMMUNICATIONS COMMISSION
Kathryn S. Berthot
Chief, Spectrum Enforcement Division
Enforcement Bureau
47 U.S.C. S: 301.
47 C.F.R. S: 1.903(a).
File No. 0003004682 (filed Apr. 24, 2007). To date, the Wireless Bureau
has not acted on the pending STA.
See Letter from Kathryn S. Berthot, Chief, Spectrum Enforcement Division,
Enforcement Bureau, Federal Communications Commission to Mr. Keith A.
Larson, General Manager, Dakota Central Telecommunications Cooperative
(August 23, 2007).
See Letter from Stephen E. Coran, Counsel for Dakota Central
Telecommunications Cooperative to Katherine Power, Esq., Spectrum
Enforcement Division, Enforcement Bureau, Federal Communications
Commission (September 21, 2007) ("LOI response").
Id. at 3.
Id. at 2.
Id. at 2. Dakota Central states that the employee who must have initiated
transmission of video programming on EBS channel C2 in 1994 has since been
fired for cause. It further states that the provision of broadband service
on EBS channels C3 and D3 was initiated in 2001 on the advice of its
consulting engineer, who "suggested that there was vacant spectrum that
could be used until such time as the Commission lifted the `freeze' on
filing applications for EBS licenses." Id. at 2.
On April 25, 2007, Dakota Central filed a waiver request which proposed a
spectrum plan under which the unauthorized operation could be relocated to
other spectrum, negating the need for the STA. On May 24, 2007, the
Wireless Bureau placed this waiver request on public notice. Wireless
Telecommunications Bureau Seeks Comment on Request by Dakota Central
Telecommunications Cooperative for Waiver of the Requirement to Transition
to the New BRS/EBS Band Plan and for Special Temporary Authority on
Certain EBS Channels in Brush Hill, North Dakota, Public Notice, 22 FCC
Rcd 9371 (Wireless Tel. Bur., Broadband Div. 2007). This waiver request is
still pending.
LOI response at 4-5. To ensure its future compliance, Dakota Central
limited the commencement of operations on any spectrum to one person and
posted all BRS licenses and EBS leases at the transmit site so that field
personnel would be better aware of authorized channels and operating
parameters.
Id. at 6.
47 U.S.C. S: 503(b)(1)(B); 47 C.F.R. S: 1.80(a)(1). Section 312(f)(1) and
(2) of the Act defines "willful" as "the conscious and deliberate
commission or omission of [any] act, irrespective of any intent to
violate" the law, and defines "repeated" as "the commission or omission of
such act more than once" and if continuous "more than one day." 47 U.S.C.
S: 312(f)(1) and (2). The legislative history of Section 312(f)(1) and (2)
clarifies that the definitions of willful and repeated apply to both
Sections 312 and 503(b) of the Act. See H.R. Rep. No. 97-765, 97th Cong.
2d Sess. 51 (1982). Consistent with the legislative history, the
Commission has so interpreted the terms in the Section 503(b) context.
See, e.g., Southern California Broadcasting Co., Memorandum Opinion and
Order , 6 FCC Rcd 4387, 4388 (1991); National Weather Networks, Inc.,
Notice of Apparent Liability for Forfeiture, 21 FCC Rcd 3922, 3925 (Enf.
Bur., Spectrum Enf. Div., 2006).
See 47 U.S.C. S: 503(b); 47 C.F.R. S: 1.80(f).
See, e.g., SBC Communications, Inc., Forfeiture Order, 17 FCC Rcd 7589,
7591 (2002).
47 C.F.R. S: 1.80.
47 U.S.C. S: 503(b)(2)(C). The Commission twice amended Section 1.80(b)(3)
of the Rules, 47 C.F.R. S: 1.80(b)(3), to increase the maximum forfeiture
amounts, in accordance with the inflation adjustment requirements
contained in the Debt Collection Improvement Act of 1996, 28 U.S.C. S:
2461. See Amendment of Section 1.80 of the Commission's Rules and
Adjustment of Forfeiture Maxima to Reflect Inflation, Order, 15 FCC Rcd
18221 (2000) (adjusting the maximum statutory amounts from $10,000/$75,000
to $11,000/$87,500); Amendment of Section 1.80 of the Commission's Rules
and Adjustment of Forfeiture Maxima to Reflect Inflation, Order, 19 FCC
Rcd 10945 (2004) (adjusting the maximum statutory amounts from
$11,000/$87,500 to $11,000/$97,500); see also 47 C.F.R. S: 1.80(c).
47 U.S.C. S: 503(b)(2)(E). See also 47 C.F.R. S: 1.80(b)(4), Note to
paragraph (b)(4): Section II. Adjustment Criteria for Section 503
Forfeitures.
47 U.S.C. S: 503(b)(6).
See, e.g., Globcom, Inc. d/b/a Globcom Global Communications, Notice of
Apparent Liability for Forfeiture and Order, 18 FCC Rcd 19893, 19903
(2003), forfeiture ordered, Forfeiture Order, 21 FCC Rcd 4710 (2006);
Roadrunner Transportation, Inc., Forfeiture Order, 15 FCC Rcd 9669,
9671-71 (2000); Bureau D'Electronique Appliquee, Inc., Notice of Apparent
Liability for Forfeiture, 20 FCC Rcd 3445, 3447-48 (Enf. Bur., Spectrum
Enf. Div., 2005), forfeiture ordered, 20 FCC Rcd 17893 (Enf. Bur.,
Spectrum Enf. Div, 2005).
See Global Radio, Inc., Notice of Apparent Liability for Forfeiture,
NAL/Acct. No. 200332940003 (Enf. Bur., San Diego Office, released March 8,
2003), forfeiture ordered, 19 FCC Rcd 18575 (Enf. Bur. 2004) (finding the
operation on three unauthorized frequencies constitutes three separate
violations).
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, 17112 (1997), recon. denied, 15 FCC Rcd 303
(1999) (noting that the we "retain the discretion to issue a higher or
lower forfeiture" than the base forfeiture amounts set forth in our Rules
and our Forfeiture Guidelines).
See Domtar Industries, Inc., Notice of Apparent Liability for Forfeiture,
21 FCC Rcd. 13811 (Enf. Bur., Spectrum Enf. Div., 2006) (proposing an
upward adjustment for operation of a Private Land Mobile Radio system
without any Commission authorization for more than five years).
See 47 C.F.R. S: 1.80(b)(4), Note to paragraph (b)(4): Section II.
Adjustment Criteria for Section 503 Forfeitures.
See Petracom of Texarkana, LLC, Forfeiture Order, 19 FCC Rcd 8096,
8097-8098 (Enf. Bur., 2004) (reducing a forfeiture based on the licensee's
voluntarily disclosure to Commission staff of the violations prior to
inspection by field agent); Journal Broadcasting Corp., Notice of Apparent
Liability for Forfeiture, 20 FCC Rcd 18211, 18214 (Enf. Bur., Spectrum
Enf. Div., 2005) (reducing a proposed forfeiture based on the licensee's
voluntary disclosure of the violation to Commission staff prior to
Commission inquiry).
See Sutro Corporation, Memorandum Opinion and Order, 19 FCC Rcd 15274
(2004); Blountstown Communications, Inc., Memorandum Opinion and Order, 22
FCC Rcd 1097 (Enf. Bur. 2007) (both reducing a forfeiture based on the
licensee's past history of compliance).
47 C.F.R. S:S: 0.111, 0.311, 1.80.
See 47 C.F.R. S: 1.1914.
Id.
Federal Communications Commission DA 08-869
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Federal Communications Commission DA 08- 869