Click here for Adobe Acrobat version
Click here for Microsoft Word version
********************************************************
NOTICE
********************************************************
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.
*****************************************************************
Before the
Federal Communications Commission
Washington, D.C. 20554
)
) File No. EB-07-SE-023
In the Matter of
) NAL/Acct. No. 200732100036
Syntax-Brillian Corporation
) FRN # 0016507311
)
FORFEITURE ORDER and
notice of apparent liability for forfeiture
Adopted: April 9, 2008 Released: April 10, 2008
By the Commission:
I. INTRODUCTION
1. In this Forfeiture Order and Notice of Apparent Liability for
Forfeiture, we issue a monetary forfeiture in the amount of one
million, two hundred sixty six thousand, one hundred dollars
($1,266,100) against Syntax-Brillian Corporation ("Syntax-Brillian")
for its willful and repeated violations of Sections 15.117(i)(1)(i)
and (ii) of the Commission's rules ("Rules"). These violations involve
Syntax-Brillian's importation and interstate shipment of television
receivers that do not comply with the Commission's rules regarding
digital television ("DTV") reception capability. In addition, we
propose a forfeiture in the amount of eleven thousand dollars
($11,000) against Syntax-Brillian for providing to the Commission,
during the course of staff's investigation of its violations of the
DTV tuner requirement, material factual information that is incorrect
without a reasonable basis for believing the material factual
information was correct, in willful violation of Section 1.17(a)(2) of
the Rules.
II. background
2. The Commission adopted the DTV reception capability requirement in
2002. That requirement, which also is often termed the "DTV tuner
requirement," requires that all new television broadcast receivers
that are imported into the United States or shipped in interstate
commerce be capable of receiving the signals of DTV broadcast stations
over-the-air. The DTV tuner requirement was intended to facilitate the
transition to digital television by promoting the availability of DTV
reception equipment and to protect consumers by ensuring that their
television receivers will provide off-the-air television reception of
digital signals just as they have provided off-the-air television
reception of analog signals.
3. In order to minimize the impact of the DTV tuner requirement on both
manufacturers and consumers, the Commission adopted a phase-in
schedule that applied the requirement first to receivers with the
largest screens and then to progressively smaller screen receivers and
other television receiving devices without a viewing screen, i.e.,
VCRs and DVD players. This phase-in plan was intended to allow
increasing economies of scale with production volume to be realized so
that DTV tuner costs would be lower when they were required to be
included in smaller sets and other television receiving devices. As
modified by the Commission in 2005, this phase-in schedule was as
follows:
Receivers with screen sizes 36" and above -- 50% of units imported or
shipped interstate by responsible parties were required to include DTV
tuners effective July 1, 2004; 100% of such units were required to include
DTV tuners effective July 1, 2005;
Receivers with screen sizes 25" to 35" -- 50% of units imported or shipped
interstate by responsible parties were required to include DTV tuners
effective July 1, 2005; 100% of such units were required to include DTV
tuners effective March 1, 2006;
Receivers with screen sizes less than 25" -- 100% of units imported or
shipped interstate by responsible parties were required to include DTV
tuners effective March 1, 2007; and
Other video devices (videocassette recorders (VCRs), digital video
recorders such as hard drive and DVD recorders, etc.) that receive
television signals -- 100% of units imported or shipped interstate by
responsible parties were required to include DTV tuners effective March 1,
2007.
4. In January 2007, the Enforcement Bureau's review of Customs
importation data indicated that Syntax-Brillian apparently was
importing television receivers with screen sizes 25" to 35" ("mid-size
receivers") that did not include DTV tuners after the applicable March
1, 2006 deadline. The Enforcement Bureau issued a letter of inquiry
("LOI") to Syntax-Brillian on March 8, 2007. On March 19, 2007,
Syntax-Brillian filed a response to the LOI.
5. On May 30, 2007, the Commission issued a Notice of Apparent Liability
for Forfeiture ("NAL") proposing a forfeiture against Syntax-Brillian
for its apparent willful and repeated violations of the DTV tuner
requirements. Specifically, based on the company's LOI Response, the
NAL found that after the July 1, 2005 deadline for large-size
television receivers, Syntax-Brillian made eight interstate shipments
of a total of 165 non-DTV compliant large-size screen receivers. In
addition, the NAL found that after the March 1, 2006 deadline for
mid-size screen receivers, it imported on 88 dates a total of 28,430
non-DTV-compliant mid-size receivers and made 1,765 interstate
shipments of a total of 43,892 non-DTV-compliant mid-size screen
receivers. In total, the NAL found that Syntax-Brillian imported and
shipped interstate a total of 72,622 non-DTV-compliant television
receivers on 1,861 occasions. The NAL further concluded that
violations of the DTV tuner requirement would be subject to
forfeitures on a per-unit, rather than a per model, basis because the
important public policy goal of facilitating the transition to digital
television rendered violations of the DTV tuner requirement more
egregious than violations of other equipment marketing rules. Using a
per-unit formula, the NAL therefore proposed a forfeiture of
$2,899,575 against Syntax-Brillian for its DTV tuner violations.
6. In its response to the NAL, Syntax Brillian acknowledges that it
imported and shipped interstate both large-size and mid-size receivers
that did not comply with the DTV tuner requirement. Syntax-Brillian
maintains, however, that the Commission erred in issuing the NAL
without first issuing a citation; that it did not violate the DTV
tuner requirement because it followed the Commission's "policy" of
labeling its non-DTV-compliant receivers as "HD-ready"; that the NAL
and the per-unit forfeiture methodology violate the Administrative
Procedure Act ("APA") and Syntax-Brillian's due process rights; that
the forfeiture amount is excessive, violates the Eighth Amendment to
the Constitution, and is inconsistent with Commission precedent; and
that the Commission "breached" an agreement between the FCC and
Syntax-Brillian to toll the statute of limitations for forfeiture
actions. Further, Syntax-Brillian asserts that the forfeiture should
be substantially reduced because of disclosures it made and actions it
took after it received the LOI, its history of compliance with the
Commission's rules, the lack of harm to the public, and the lack of
any allegation of misrepresentation on the part of Syntax-Brillian.
III. forfeiture order
7. The proposed forfeiture set forth in the NAL was assessed in
accordance with Section 503(b) of the Act and Section 1.80 of the
Rules, and the guidelines enunciated in the Commission's Forfeiture
Policy Statement. In assessing forfeitures, Section 503(b)(2)(E) of
the Act requires that we take into account 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. We have considered
Syntax-Brillian's claims in light of the above statutory factors, and
have determined that, with the exception of a reduction based on the
number of receivers mistakenly described as being shipped interstate
by Syntax-Brillian in its LOI Response and the number of receivers
imported by Syntax-Brillian, there is no basis for reduction of the
proposed forfeiture.
A. The Commission Was Not Required to Issue a Citation to Syntax-Brillian
Prior to Issuing the NAL.
8. We reject Syntax-Brillian's assertion that the NAL is unenforceable
because the Commission did not first issue it a citation in accordance
with Section 503(b)(5) of the Act. Section 503(b)(5) provides that
No forfeiture liability shall be determined under this subsection against
any person, if such person does not hold a license, permit, certificate,
or other authorization issued by the Commission, ... unless, prior to the
notice required by paragraph (3) of this subsection or the notice of
apparent liability required by paragraph (4) of this subsection, such
person (A) is sent a citation of the violation charged; (B) is given a
reasonable opportunity for a personal interview with an official of the
Commission, at the field office of the Commission which is nearest to such
person's place of residence; and (C) subsequently engages in conduct of
the type described in such citation.
According to Syntax-Brillian, a citation was required in this case because
it "does not hold a license, permit, certificate, or other authorization
issued by the Commission." We disagree. Under Part 15 of the Rules,
television broadcast receivers are unintentional radiators and are
required to be authorized under the verification procedure prior to the
initiation of marketing. Verification is a form of equipment authorization
"where the manufacturer makes measurements or takes the necessary steps to
insure that the equipment complies with the appropriate technical
standards." Pursuant to Section 2.909(b) of the Rules, the party
responsible for ensuring compliance of equipment with the applicable
standards is "[i]n the case of equipment subject to authorization under
the verification procedure, the manufacturer or, in the case of imported
equipment, the importer." Thus, as the manufacturer and importer of the
television receivers in question, Syntax-Brillian was the party
responsible for authorizing the television receivers under the
verification procedure. Therefore, we conclude that Syntax-Brillian holds
a Commission authorization for purposes of Section 503(b)(5).
9. In addition, we reject Syntax-Brillian's implication that verification
is not an "authorization" within the meaning of Section 503(b)(5). The
verification procedures are set forth in Subpart J of the Part 2
Rules, entitled "Equipment Authorization Procedures," and verification
is described in the rules as an "equipment authorization." Among other
things, the rules governing equipment subject to authorization under
the verification procedures specify detailed technical requirements
and measurement procedures, set forth limitations on the verification,
require the responsible party to maintain detailed records on the
equipment and provide copies of those records to the Commission upon
request, require the responsible party to provide samples of the
equipment to the Commission upon request for testing, and prescribe
identification, labeling, and user manual requirements. Absent
compliance with the comprehensive technical and administrative
requirements set forth in the rules, equipment subject to verification
is considered to be "unauthorized" and may not be marketed in the
United States.
10. Moreover, we note that there is no doubt that Congress intended to
subject television equipment manufacturers to full and immediate
forfeiture liability by virtue of the 1978 amendments. Congress
enacted the citation procedure in Section 503(b)(5) in 1978 in
conjunction with certain other amendments to the forfeiture provisions
of Section 503. One of the 1978 amendments extended the forfeiture
provisions of Section 503(b) to cover any person subject to any
provision of the Act or the Rules. The legislative history of the 1978
amendments makes clear that Congress intended to include
communications equipment manufacturers within the Commission's
forfeiture authority. Further, at the time of the 1978 amendments,
television receivers were subject to authorization under the
certification procedure, which is a written authorization issued by
the Commission upon application to the Commission.
11. Additionally, the legislative history of Section 503(b)(5) indicates
that the citation requirement is intended as a
special procedural protection ... for those persons who will be made
subject to forfeiture liability for the first time and who are presumed to
be unaware of Commission regulations .... This special citation procedure
and interview requirement protects persons who would otherwise be subject
to immediate forfeiture for willful violations such as altering electronic
devices which emit electromagnetic radiation (such as garage door openers
or electronic water heaters or electronic ovens) in violation of FCC
rules.
In light of Congress' clear intention to extend the Commission's
forfeiture authority to equipment manufacturers, Congress cannot
reasonably be understood to have intended to include equipment
manufacturers, which had been subject to regulation by the Commission for
more than 15 years prior to the 1978 amendments, among the class of
individuals likely to be unaware of their obligations under the Rules and
in need of a special procedural protection in the forfeiture context.
12. When the Commission subsequently relaxed the equipment authorization
rules in 1984 to permit authorization of television receivers and
certain other devices under the verification procedure, it clearly did
not intend to limit or reduce its future ability to take enforcement
action. Rather, the Commission's objective was to reduce the amount of
time needed for an applicant to obtain an equipment authorization for
certain types of equipment that is less likely to generate harmful
interference, while affording the Commission the flexibility to
concentrate its resources where they are most needed. To ensure
continued compliance of the verified equipment with applicable
regulations, the Commission instituted an equipment sampling program
and emphasized that it intended to use its enforcement authority under
the Act, "especially the direct forfeiture authority contained in
Section 503 and implemented in Section 1.80 of the Rules, to the
greatest extent possible when noncompliance is found by our sampling
program." Accordingly, we conclude that Syntax-Brillian, an equipment
manufacturer that acknowledges that it was aware of the DTV tuner
requirements, was not entitled to a citation prior to issuance of the
NAL.
B. Syntax-Brillian's Labeling of its Receivers as "HD-Ready" Did Not
Satisfy the DTV Tuner Requirement.
13. We find no merit in Syntax-Brillian's argument that it did not violate
the DTV tuner requirement because it "complied with the law by
disclosing the functional limitations of the receivers."
Syntax-Brillian states that its labeling of its receivers, which had
the capability to tune and decode digital satellite and cable signals
with an external tuner, as "HD Ready" was "consistent with established
industry practices and informal Commission guidance." Syntax-Brillian
claims, in this regard, that
[b]eginning in 2002 through May 2007, the Commission's policy was that it
was not a violation to manufacture and market receivers that do not
include the capability to tune over-the-air broadcast digital signals
where the receivers are paired with digital cable or direct broadcast
satellite service and the functional limitation is disclosed.
In support of this claim, Syntax-Brillian quotes the following statement
in the DTV Review Second Report and Order:
In the Report and Order/Further Notice, we observed that digital
television receivers, i.e. devices with integrated displays as opposed to
set-top receiving devices that do not include displays, could be marketed
that do not have the capability to receive over-the-air broadcast signals.
For example, receivers intended only for use in receiving digital cable or
direct broadcast satellite service might not include the capability to
tune over-the-air broadcast television signals ....
Syntax-Brillian notes that the Commission had requested comment on whether
to "require any digital television receivers that cannot receive
over-the-air digital signals to carry a label informing consumers of this
limitation on the receivers' functionality" but concluded in the DTV
Review Second Report and Order that it would not, at that time, require
such a label. Syntax-Brillian further notes that in 2004 and again in 2005
the Commission declined to promulgate a labeling requirement to disclose
functional limitations, but encouraged responsible parties to clearly
label new television receivers or employ other means to inform consumers
whether or not specific models are able to receive over-the-air digital
signals. Thus, according to Syntax-Brillian, at the time of its alleged
violations the Commission had publicly acknowledged that manufacturers
could import and ship receivers with functional limitations with a
disclosure of the limitation. Syntax-Brillian maintains that because the
Commission did not adopt specific labeling requirements until May 2007,
Syntax-Brillian acted reasonably in placing an "HD-Ready" label on its
receivers.
14. We disagree. First, the DTV tuner requirement clearly and
unequivocally requires all new TV broadcast receivers that are
imported into the United States or shipped in interstate commerce to
be capable of receiving the signals of DTV broadcast stations
over-the-air in accordance with the schedule set forth in the
Commission's rules. Syntax-Brillian's contention that the Commission
had a "policy" of permitting the importation and interstate shipment
of non-DTV-compliant television receivers provided that the receiver's
functional limitation is disclosed is specious. Syntax-Brillian's
interpretation would allow manufacturers to continue importing and
shipping interstate non-DTV-compliant receivers indefinitely,
completely undermining the clear language and objectives of the DTV
tuner requirement. Syntax-Brillian's interpretation also is
inconsistent with a reasonable reading of the Commission's orders. It
is clear that, in the sentence from the DTV Review Second Report and
Order quoted by Syntax-Brillian, the Commission was considering
whether to adopt labeling requirements for television receivers
without any capability to receive over-the-air broadcast signals.
Indeed, in the sentence following the one quoted, the Commission
stated that "while we are not aware that any such receivers are being
marketed at this time, such devices would be permissible under our
rules" because "[t]he all-channel reception provisions of Section
15.117(b) of the rules, and indeed the ACRA authority underlying those
provisions, would not apply to receivers that did not have any
capability for receiving broadcast signals over-the-air." The
receivers manufactured, imported and shipped interstate by
Syntax-Brillian, by contrast, have the capability to receive broadcast
signals over-the-air and, therefore, are required to comply with the
DTV tuner requirement.
15. Moreover, while the Commission did consider whether to adopt labeling
requirements for receivers capable of receiving over-the-air broadcast
signals in 2004 and in 2005, prior to the complete phase-in of the DTV
tuner requirement for mid-sized receivers, the Commission did not
adopt any labeling requirements at that time, and nothing in those
decisions even remotely suggests that labeling or some other
functional limitation disclosure was an acceptable substitute for
compliance with the DTV tuner requirement. We note that the labeling
requirement ultimately adopted by the Commission in May 2007 applies
to the retail sale of analog-only television receivers from inventory,
a situation not covered by our DTV tuner requirement. It cannot
reasonably be read to allow importation and interstate shipment of
receivers that do not comply with our DTV tuner requirement after the
applicable deadlines. Finally, contrary to Syntax-Brillian's argument,
the April 2006 tip sheet on "Buying a Digital Television" does not
represent a public acknowledgment by the Commission that manufacturers
could import and ship interstate receivers without DTV tuners with a
disclosure of the limitation. The tip sheet provides "basic
information about DTV to assist consumers;" it contains no information
or guidance regarding manufacturer compliance with the DTV tuner
requirement or Commission policy on equipment labeling.
C. The NAL and the Proposed Forfeiture Do Not Violate the Administrative
Procedure Act ("APA") or Syntax-Brillian's Due Process Rights.
16. We reject Syntax-Brillian's argument that it is arbitrary and
capricious and an abuse of discretion under the APA for the Commission
to impose a forfeiture in this case because most of the violations
occurred between March 1, 2006 and June 1, 2006. Syntax-Brillian notes
that it was "substantially compliant" with the original July 1, 2006
deadline by which responsible parties were to comply with the DTV
tuner requirement for mid-size television receivers. Further, it
asserts that it was arbitrary and capricious, and an abuse of
discretion, for the Commission to accelerate the mid-size receiver
deadline because it did not provide a reasoned basis for doing so.
17. Syntax-Brillian's argument is effectively an untimely petition for
reconsideration of the DTV Tuner Report and Order, and a collateral
attack on the rule underpinning the NAL. The filing of petitions for
reconsideration in rulemaking proceedings is governed by Section 1.429
of the Rules, which requires a petition for reconsideration to be
"filed within 30 days from the date of public notice of such action."
Petitions for reconsideration of the DTV Tuner Report and Order were,
therefore, due on August 5, 2005. The predecessor companies to
Syntax-Brillian (Syntax Groups Corporation and Brillian Corporation)
did not file a petition for reconsideration, though they had notice
and opportunity to do so. Thus, Syntax-Brillian's NAL Response will be
considered an untimely petition for reconsideration of the DTV Tuner
Report and Order that must be denied. Moreover, the Commission has
previously decided that indirect challenges to Commission decisions
adopted in proceedings in which the right to review has expired, such
as the instant one, are considered impermissible collateral attacks
and are properly denied.
18. In addition to rejecting Syntax-Brillian's claim that accelerating the
mid-size receiver deadline violates the APA on procedural grounds, we
disagree with the substance of its argument that we did not provide a
reasoned justification in the DTV Tuner Report and Order for
accelerating the 100 percent compliance date for mid-size receivers.
Our June 2005 decision to accelerate the compliance deadline for
mid-size DTV receivers was reached following a rulemaking proceeding
initiated by a Petition for Rulemaking submitted by the Consumer
Electronics Association and the Consumer Electronics Retailers
Association ("CEA-CERC"). Key to our decision was that manufacturers
commenting in that proceeding indicated they supported accelerating
the date by which 100 percent of mid-size television receivers would
be required to include a DTV tuner from July 1, 2006 to March 1, 2006
and could equip 100 percent of new mid-size television receivers with
DTV tuners by March 1, 2006. Based on the record developed in the
rulemaking, we determined that the general population of television
manufacturers would be able to meet the new deadline. Syntax-Brillian
has given us no persuasive reason to revisit that determination.
19. Syntax-Brillian also argues that the NAL violates its Fifth Amendment
due process rights because it proposes a forfeiture "without having
previously articulated a coherent legal standard permitting
Syntax-Brillian to measure the efficacy of its labeling disclosure
which the NAL rejects as inadequate." As discussed above, however, the
standard Syntax-Brillian was required to follow is contained in
Section 15.117 of our Rules and is clearly articulated.
Syntax-Brillian failed to follow this standard. Accordingly, we reject
Syntax-Brillian's due process argument.
D. The Tiered, Per-Unit Formula Used to Calculate the Proposed Forfeiture
Does Not Violate the APA or Due Process.
20. We find, contrary to Syntax-Brillian's argument, that the tiered,
per-unit formula articulated in the NAL does not substantively amend
the DTV tuner regulations without notice and comment and, therefore,
does not violate the APA. Syntax-Brillian maintains that the
Commission had numerous opportunities in the DTV rulemaking proceeding
to issue public notice and request comment on the method of
calculating sanctions proposed in the NAL and that "it knew full well
... that the violations are not contemplated in the Forfeiture Policy
Statement."
21. The APA does not mandate that the Commission issue notice and request
comment each time it proposes a forfeiture or a forfeiture approach
for rule violations not specifically contemplated at the time the
Forfeiture Policy Statement was adopted. The forfeiture guidelines set
forth in the Forfeiture Policy Statement are intended to provide a
degree of predictability and uniformity to the forfeiture process.
Nevertheless, the Commission retains its discretion to assess
forfeitures on an individual, case-by-case basis under its general
forfeiture authority in Section 503 of the Act. As noted in the NAL,
Section 503 authorizes us to assess forfeitures to entities such as
Syntax-Brillian of up to $11,000 for each violation, or each day of a
continuing violation, up to a statutory maximum of $97,500 for a
single act or failure to act. Pursuant to Section 503(b), weighing the
factors set forth in the statute, the Commission may determine the
appropriate forfeiture within the range permitted by the statute.
Thus, Syntax-Brillian had full notice under the APA that the maximum
potential forfeiture for each violation - that is, each unit shipped
or imported in violation of the DTV tuner requirement - could be the
statutory maximum.
22. We also reject Syntax-Brillian's assertion that our decision to adopt
a tiered, per-unit formula for calculating forfeitures for violations
of the DTV tuner requirement arbitrarily and capriciously rejects a
per model approach without adequate justification. Syntax-Brillian
claims that the only factor cited by the Commission to support a
finding that the violation was egregious is the assertion that the
company imported and shipped interstate a large number of
non-compliant television receivers, and points out that the quantity
of violations was miscalculated. We disagree. As we stated in the NAL,
we consider violations of the DTV tuner requirement to be more
egregious, in general, than other types of equipment marketing cases
because this requirement promotes an important public policy goal of
helping to facilitate the transition to digital television. Without a
digital-to-analog converter box, consumers using analog devices like
those imported and shipped by Syntax-Brillian will be unable to
receive most broadcast television signals after February 17, 2009.
Thus, our assessment that the seriousness of DTV tuner requirement
violations warrants a per-unit approach does not rest on the number of
units imported or shipped interstate by any one responsible party in
violation of the DTV tuner requirement, but, rather, on the conclusion
that calculating proposed forfeitures on a per model basis would
result in forfeiture amounts that are not commensurate with the
seriousness of the violation and may not effectively deter future
violations. We further concluded that, to reflect the increasing
seriousness of the violation as the number of non-compliant units
shipped or imported rises, we would apply an increased per-unit
forfeiture as the total number of violations increases and crosses
certain thresholds or tiers.
23. Syntax-Brillian also asserts that the tiered, per-unit forfeiture
scheme is excessive, unlawfully duplicative, and an abuse of our
discretion because it considers importing and interstate shipping of a
single receiver as separate violations. Specifically, Syntax-Brillian
argues that the NAL proposes forfeitures "for multiple . . .
individual equipment violation[s] without explanation" that are
"unprecedented" and "an abuse of discretion." Section 15.117 clearly
imposes two distinct prohibitions on responsible parties: it prohibits
either importing or shipping interstate television receivers that do
not contain digital tuners. We find, however, that treating the
importation and subsequent interstate shipment of the same television
receiver as two separate violations is unnecessary. Given that the DTV
tuner rule is meant to ensure that all television receiving devices
are equipped with a digital tuner, we conclude that the purpose of the
rule will best be served by treating the importation and subsequent
interstate shipment of the same receiver as a single violation. In
future forfeiture actions taken for violations of the DTV tuner
requirement, we will assess the facts of each case in determining how
best to enforce the requirements of Section 15.117 using this
interpretation. Because we cannot determine how many of the units
imported by Syntax-Brillian were not subsequently shipped interstate,
we will not impose a forfeiture against Syntax-Brillian for the 3,466
non-DTV-compliant receivers it imported.
24. We find no merit, however, in Syntax-Brillian's argument that the NAL
is predicated on the Commission's unwarranted rejection of the
statutory maximum and is devoid of any explanation as to why the
statutory maximum would not encourage compliance. As stated in the
NAL, Section 503 authorizes us to assess forfeitures against entities
such as Syntax-Brillian of up to $11,000 for each violation, or each
day of a continuing violation, up to a statutory maximum of $97,500
for a single act or failure to act. Each separate interstate shipment
of a non-DTV-compliant receiver by Syntax-Brillian constituted a
separate violation subject to the statutory maximum forfeiture.
Because the per-unit forfeiture amounts proposed against
Syntax-Brillian did not exceed $175 per unit, this conclusion stands
whether that relevant maximum forfeiture amount is $11,000 or $97,500.
Thus, the tiered, per-unit approach established in the NAL results in
a forfeiture amount that is actually significantly lower than the
maximum potential forfeiture.
25. Further, we find unpersuasive Syntax-Brillian's argument that the
per-unit forfeiture approach is excessive relative to the forfeitures
proposed by the Commission for "substantially more egregious" DTV
labeling violations. In support of this argument, Syntax-Brillian
notes that in the recent DTV labeling NALs, the Commission proposed an
$8,000 base forfeiture amount per unlabeled model or device. We
disagree with Syntax-Brillian that DTV labeling violations are more
egregious than DTV tuner violations. The failure of a manufacturer to
comply with the DTV tuner requirement, which has been in place in some
form for more than five years and is intended to limit the
availability of analog-only television receivers, is substantially
more egregious than the failure of a retailer to comply with the DTV
labeling requirements, which permit the sale of analog-only receivers,
as long as consumers are fully informed about the limitations of those
devices. Although the DTV tuner requirement and the DTV labeling
requirement both address the issue of consumer harm, we consider
violations of the DTV tuner requirement to be more egregious because
that requirement is fundamental to a successful DTV transition: it
prevents non-compliant, analog-only television receivers from entering
the stream of commerce in the first place. By contrast, the DTV
labeling requirement is primarily informational in nature. It
mitigates the harm resulting from the sale of analog-only television
receivers from pre-March 1, 2007 inventory, which will eventually be
exhausted, by requiring retailers to disclose the limitations of the
devices to consumers at the point of sale.
26. Finally, we disagree with Syntax-Brillian's assertion that "the
per-unit policy injects uncertainty into the forfeiture process in a
manner completely at odds with the Commission's stated objectives." As
discussed above, the guidelines set forth in the Forfeiture Policy
Statement were intended to provide a degree of predictability and
uniformity to the forfeiture process, but the Commission has
substantial discretion in proposing forfeitures. Furthermore, the
per-unit forfeiture methodology will provide consistency and
predictability in any future cases involving violations of the DTV
tuner requirements.
E. The Proposed Forfeiture Is Not Inconsistent with Commission Precedent.
27. We reject Syntax-Brillian's argument that the proposed forfeiture
departs from prior Commission cases imposing large forfeitures based
on conduct deemed to be egregious. In particular, Syntax-Brillian
cites our recent decision in Behringer. Syntax-Brillian asserts that
Behringer's conduct was far more egregious given the quantity of
affected models and units in Behringer and the fact that Behringer
continued to violate the rules after the investigation had begun,
which resulted in a forfeiture of $1,000,000, approximately one-third
of the amount proposed against Syntax-Brillian. Syntax-Brillian also
cites several slamming and other cases involving "deceptive business
practices," asserting that the forfeiture proposed here is vastly more
substantial than any assessed against companies which actively
deceived consumers after the Commission specifically warned them not
to do so.
28. While we acknowledge that Behringer involved a significant volume of
unauthorized models and units, we note that all but two of the models
at issue in Behringer were ultimately found to comply with applicable
technical standards. In contrast, the devices manufactured, imported
and shipped interstate by Syntax-Brillian do not comply with the DTV
tuner requirement. Thus, the harm to consumers resulting from
Syntax-Brillian's non-compliance makes this case substantially more
egregious than Behringer. Furthermore, contrary to Syntax-Brillian's
suggestion, we are not required to issue prior warnings or find that
it deceived consumers in order to find that its violations were
egregious. We concluded in the NAL that the DTV tuner requirement
promotes the important public policy goal of facilitating the
transition to digital television and that violations of this
requirement therefore are egregious. Syntax-Brillian has given us no
persuasive reason to revisit that finding. Although Syntax-Brillian,
unlike the manufacturer in Behringer and other cases that
Syntax-Brillian cites, may not have actively deceived consumers after
a specific Commission warning, Section 503(b)(2)(E) of the Act
requires that we take into account multiple factors in assessing
forfeitures, and we cannot conclude based on consideration of a single
factor that the sanction here is inconsistent with Commission
precedent.
29. We also reject Syntax-Brillian's assertion that the per-unit
forfeiture scheme articulated in the NAL violates the Excessive Fines
Clause of the Eighth Amendment because it is "indefinite, unlimited
and grossly disproportionate" to the DTV violation cited in the NAL.
In support of this argument, Syntax-Brillian cites United States v.
Bajakajian, where the government sought the forfeiture of the entire
amount of currency ($357,144) possessed by a defendant who violated a
statute requiring that the export of more than $10,000 outside the
United States be reported. Noting that the defendant's crime was
solely a reporting offense, that the violation was unrelated to any
other illegal activities, and that the harm caused by the reporting
failure was minimal, the Court concluded that forfeiture of the entire
amount of the exported currency would be grossly disproportionate to
the gravity of the reporting failure. The instant case, by contrast,
involves a violation of the substantive requirement to include a DTV
tuner in receivers imported and shipped interstate. Given that this
requirement is critical to the successful transition to digital
television and the harm to consumers that results from non-compliance,
we do not believe that the per-unit forfeiture approach results in a
forfeiture amount that is grossly disproportionate to the gravity of
the violation. Nor does the per-unit forfeiture methodology produce an
indefinite or unlimited forfeiture. Rather, as discussed above, the
forfeiture amount is limited by the statutory maximum set forth in
Section 503(b)(2)(D) of the Act.
F. New Information Provided by Syntax-Brillian Warrants Adjustment of the
Forfeiture Amount.
30. We agree that, in some aspects, the NAL overstates the number of units
imported and shipped interstate in violation of the DTV tuner
requirement. Specifically, Syntax-Brillian believes that the number of
non-compliant units shipped interstate should be reduced from 14,894
units to 4,282 to reflect the following: 1) use of the correct Tolling
Date of April 30 rather than April 27 requires the elimination of 156
non-compliant units shipped interstate; 2) 3,370 of the number of
units cited in the NAL were intrastate rather than interstate
shipments; and 3) 7,086 of the non-compliant units shipped interstate
should be eliminated from the number of units used to calculate the
forfeiture because the Tolling Agreement was breached and is therefore
unenforceable. Additionally, Syntax-Brillian states that the number of
units imported is 3,466, not 7,175 as stated in the NAL, and that
number should be reduced by 3,102 to reflect the unenforceability of
the Tolling Agreement.
31. As a threshold matter, the number of non-compliant units within the
Statute of Limitations was predicated on use of an April 30 tolling
date, not April 27 as maintained by Syntax-Brillian. Therefore, there
is no need to reduce the number of non-compliant units shipped
interstate by the 156 units cited by Syntax-Brillian. As to the second
point regarding intrastate shipments, the forfeiture proposed in the
NAL was based on the information submitted by Syntax-Brillian in its
LOI Response, which characterized all of the shipments as interstate.
Based on Syntax-Brillian's new representations in its NAL Response
that 3,370 of the units that the company originally characterized as
interstate shipments are actually intrastate shipments, we find it
appropriate to reduce the number of units shipped interstate by that
amount.
32. Syntax-Brillian also disagrees with the number of receivers identified
in the NAL, 7,175, as having been imported within the statute of
limitations. It believes that the number is actually 3,466. After
further reviewing Syntax-Brillian's LOI Response, and based on new
information provided by Syntax-Brillian in its NAL Response which
shows that 1,390 units listed in the LOI Response as imports were not
actually imported into the United States, we concur with
Syntax-Brillian that the number of units imported within the statute
of limitations in violation of the DTV tuner requirement is 3,466.
However, for the reasons noted above, we will not impose a forfeiture
against Syntax-Brillian for this violation.
33. Syntax-Brillian's arguments concerning the Tolling Agreement lack
merit. On April 30, 2007, after Syntax-Brillian raised the possibility
of settlement, the Commission executed a Tolling Agreement with it.
Syntax-Brillian's argument is, essentially, that the Commission
breached the April 30, 2007 Tolling Agreement by issuing the NAL
rather than entering into a consent decree with it. However, a Tolling
Agreement is not a bilateral contract between the Commission and a
party that obligates the Commission to enter into a Consent Order.
Instead, a Tolling Agreement is simply a tool used to facilitate
consent decree negotiations by extending the amount of time available
for the Commission and the signatory party to conduct negotiations.
The Tolling Agreement explicitly states that "[t]he Commission has
made no promises, representations, or inducements of any kind to
Syntax-Brillian in connection with this Tolling Agreement."
Furthermore, the Tolling Agreement provides that "Syntax-Brillian
further understands and agrees that it shall not rely on the Tolled
Period in any administrative or judicial proceeding in which it may
argue that the issuance of a notice of apparent liability for
forfeiture or such other proposed action or action by the Commission
or its delegated authority arising from the investigation ... is
barred by the statute of limitations." Thus, Syntax-Brillian has no
basis for arguing either that the Commission breached the Tolling
Agreement or that expiration of the limitations period bars the
Commission from sanctioning it for actions that occurred during the
Tolled Period. We also note that Syntax-Brillian's argument that the
staff misled or deceived it lacks merit: the Commission's course of
action was largely due to Syntax-Brillian's inaction. Five weeks after
meeting with Commission staff, Syntax-Brillian had neither responded
to a request from staff for information concerning additional
non-DTV-compliant receivers that it imported into the United States
nor presented any consent decree proposal. Accordingly, the Commission
issued the NAL. For all of these reasons, we decline to reduce the
number of DTV receivers shipped interstate by 7,086 as requested by
Syntax-Brillian on the ground of the Tolling Agreement's alleged
unenforceability.
34. After removing the 3,370 DTV receivers now found to have been shipped
intrastate rather than interstate as reported in Syntax-Brillian's LOI
Response and the 3,466 DTV receivers Syntax-Brillian imported into the
United States, the total number of units upon which we base the
forfeiture issued today is 11,524 (14,894-3,370 shipped interstate).
Applying the forfeiture calculation methodology outlined in the NAL
results in a forfeiture of $1,266,100.
G. Syntax-Brillian Has Presented No Mitigating Factors Warranting Further
Reduction of the Proposed Forfeiture.
35. As discussed below, we find that Syntax-Brillian's additional
arguments do not warrant any further reduction of the proposed
forfeiture. Specifically, Syntax-Brillian states that the forfeiture
should be reduced because it has no history of violations of either
the DTV tuner requirement or any other Rule, the period of
non-compliance was brief and ceased before the NAL was issued, it
discontinued importation and interstate shipment of non-compliant
models prior to the issuance of the NAL, it made good faith
disclosures after the NAL was issued, it implemented corrective
measures, and discontinued all the models cited in the NAL before the
Commission initiated its investigation. Further, Syntax-Brillian
states that there have been no allegations of misrepresentation by it,
that there has been no harm to the public, the majority of its
violations occurred between March 1, 2006 and July 1, 2006, and that,
as a small business, it was unable to meet the accelerated deadline of
March 1, 2006 for mid-size DTV receivers.
36. Syntax-Brillian states, correctly, that a party's prior history of
compliance with our Rules is one factor that is used when determining
a forfeiture amount. However, forfeitures are not automatically
increased or decreased on a factor-by-factor basis. Instead, we
consider the record of an investigation as a whole and the particular
facts of a case. As long as there is a rational relationship between
the factors used in arriving at a forfeiture and the level of the
forfeiture, we may decline to assign any weight to a particular factor
in a given case. In this case, because the DTV tuner requirement has
been found to be central to the successful transition from analog to
digital television, we found that violations of the DTV tuner
requirement were more egregious than violations of other equipment
marketing rules. For this reason, we established the per-unit
forfeiture guideline and articulated it in the NAL. Our goal was to
keep non-compliant television receivers out of the stream of commerce.
Given the egregious nature of Syntax-Brillian's violations and the
importance of the DTV tuner requirement, we cannot conclude that
Syntax-Brillian's prior history of compliance warrants any reduction
in forfeiture because to do so would result in a forfeiture that is
not commensurate with the gravity of its offense. Therefore, we will
not reduce the proposed forfeiture because of Syntax-Brillian's prior
history of compliance.
37. Additionally, we decline to consider Syntax-Brillian's actions as
mitigating the proposed forfeiture because it implemented corrective
measures, made its disclosures, and ceased importing and shipping
non-DTV compliant television receiver models only after the Commission
initiated an investigation of non-compliant DTV receivers that were
imported by Syntax-Brillian. Such corrective actions taken after the
Commission initiates an investigation, while laudable and important,
are not a mitigating factor warranting reduction of a forfeiture.
38. Syntax-Brillian also asserts that the forfeiture should be reduced
because no allegation of misrepresentation has been made against it.
Misrepresentation is considered a separate violation that is typically
assessed at the statutory maximum for the service provided by the
violator. It is not one of the statutory factors used to increase or
decrease forfeitures and we, therefore, decline to consider this as a
factor in mitigation of the forfeiture.
39. We also reject Syntax-Brillian's public harm argument. Syntax-Brillian
is correct that, under normal circumstances, the majority of end users
of DTV receivers will not be affected by the DTV transition because
they receive video programming via cable or satellite. Nevertheless,
as discussed above, we believe that the importation and interstate
shipment of non-DTV-compliant receivers after the applicable deadlines
does result in harm to consumers. As we stated in the Second Periodic
DTV Review 2007, consumers expect that television equipment purchased
today has the capability to receive over-the-air broadcast now and
will continue to have that capability even after the completion of the
DTV transition. Continued importation and interstate shipment of
non-DTV-compliant television receivers causes consumer disruption and
confusion inconsistent with a smooth transition to digital
broadcasting, misleads consumers who may be unaware of the transition
to digital broadcast, may lead to loss of service, and could impede
the dissemination of emergency information in case of disaster.
Therefore, we will not reduce the proposed forfeiture as
Syntax-Brillian requests.
40. Finally, Syntax-Brillian states that, as a small business formed
shortly before the March 1, 2006 deadline, it was unable to meet the
revised deadline for mid-size DTV receivers and that most of its
violations occurred between March 1, 2006 and July 1, 2006. However,
Syntax-Brillian represents the merger of two companies, both of which
were involved with manufacturing and distributing television receiving
equipment prior to the merger. Both companies, therefore, had notice
of both the original and modified deadlines for compliance with the
DTV tuner requirement. Furthermore, as previously discussed, our June
2005 decision to accelerate the compliance deadline for mid-size DTV
receivers was based on our determination in a rulemaking proceeding
that the general population of television manufacturers would be able
to meet the new deadline. Syntax-Brillian's assertion of its status as
a small business is insufficient for us to conclude that they are not
properly included in that general population of television
manufacturers. In this regard, Syntax-Brillian has not specifically
explained why such status prevented its compliance, and, as discussed
above, neither Syntax-Brillian nor its predecessors raised any
concerns about compliance with the Commission in a timely manner.
41. In accelerating the 100 percent compliance date, we also determined
that maintaining the requirement that 50 percent of mid-size
television receivers be equipped with DTV tuners by July 1, 2005,
rather than eliminating that benchmark completely, would best serve
our goal of advancing the DTV transition by stemming the flow of
analog-only television receivers as quickly as possible. Thus,
Syntax-Brillian should already have been preparing to meet the 50
percent compliance date, which occurred only three weeks after release
of the DTV Tuner Report and Order, when it received notice of the
acceleration of the 100 percent compliance date. While it is factually
correct, then, that it was "substantially in compliance" with the
original 100 percent compliance date of July 1, 2006 and most of its
violations occurred between March 1, 2006 and July 1, 2006,
Syntax-Brillian has not persuaded us that accelerating the deadline
placed an undue burden on it that justifies reducing the proposed
forfeiture. Therefore, we affirm our finding in the NAL that
Syntax-Brillian's status as a small business is not a factor in
mitigation of the forfeiture amount.
IV. notice of apparent liability for forfeiture
A. Syntax-Brillian Violated Section 1.17(a)(2) of the Rules.
42. Section 1.17(a)(2) of the Rules provides that no person may provide,
in any written statement of fact, "material factual information that
is incorrect or omit material information that is necessary to prevent
any material factual statement that is made from being incorrect or
misleading without a reasonable basis for believing that any such
material factual statement is correct and not misleading." Any person
who has received a letter of inquiry from the Commission or its staff
or is otherwise the subject of a Commission investigation is subject
to this rule. In expanding the scope of Section 1.17 in 2003 to
include written statements that are made without a reasonable basis
for believing the statement is correct and not misleading, the
Commission explained that this requirement was intended to more
clearly articulate the obligations of persons dealing with the
Commission, ensure that they exercised due diligence in preparing
written submissions, and enhance the effectiveness of the Commission's
enforcement efforts. Thus, even absent an intent to deceive, a false
statement may constitute an actionable violation of Section 1.17 of
the Rules if provided without a reasonable basis for believing that
the material factual information it contains is correct and not
misleading.
43. As noted above, Syntax-Brillian acknowledged in its NAL Response that
both the import and interstate shipment data in the LOI Response were
incorrect. Specifically, with respect to 1,390 non-DTV-compliant
receivers that it had listed as imports in its LOI Response,
Syntax-Brillian provided documentation with its NAL Response
indicating that these receivers were not imported into the United
States, but rather were shipped to Hong Kong. In addition, in response
to questions in the LOI requesting the number of non-DTV-compliant
receivers shipped interstate, Syntax-Brillian stated in its LOI
Response that the total number of receivers "shipped interstate ... is
identified in Exhibit 2" and "See Exhibit 3." Nowhere in the LOI
Response did Syntax-Brillian state that these Exhibits also included
intrastate shipments. In its NAL Response, however, Syntax-Brillian
for the first time identified certain of these shipments as
intrastate, rather than interstate.
44. As we have stated, parties must "use due diligence in providing
information that is correct and not misleading to the Commission,
including taking appropriate affirmative steps to determine the
truthfulness of what is being submitted. A failure to exercise such
reasonable diligence would mean that the party did not have a
reasonable basis for believing in the truthfulness of the
information." Syntax-Brillian has not articulated a reasonable basis
for its belief that the import and interstate shipment data in its LOI
Response were correct, nor has it provided any reason for its
provision of incorrect or misleading information. We think that, had
it exercised even a minimum of diligence prior to the submission of
its LOI Response, Syntax-Brillian would not have submitted incorrect
or misleading material factual information. We conclude, therefore,
that Syntax-Brillian lacked a reasonable basis for its belief that its
LOI Response was correct and not misleading in apparent violation of
Section 1.17(a)(2) of the Rules.
B. Proposed Forfeiture
45. 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. We conclude
under this standard that Syntax-Brillian has apparently willfully
violated Section 1.17(a)(2) of the Rules by providing incorrect or
misleading material factual information to Commission staff without a
reasonable basis for believing the information was correct and not
misleading during the course of staff's investigation of
Syntax-Brillian's violations of the DTV tuner requirement.
46. Pursuant to the Commission's Forfeiture Policy Statement and Section
1.80(b)(4) of the Rules, the base forfeiture amount for
misrepresentation or lack of candor is the statutory maximum, or, in
this case, $11,000. In determining the appropriate forfeiture amount,
we may adjust the base amount upward or downward by considering the
factors enumerated in Section 503(b)(2)(E) of the Act, including "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." Considering all of the enumerated factors and the particular
circumstances of this case, we find that the maximum permitted
forfeiture of $11,000 is warranted here for Syntax-Brillian's apparent
willful violation of Section 1.17(a)(2). The Commission has stated
that "[we rely] heavily on the truthfulness and accuracy of the
information provided to us. If information submitted to us is
incorrect, we cannot properly carry out our statutory
responsibilities." Syntax-Brillian's failure to exercise due diligence
to ensure that the information provided in its LOI Response was
correct and not misleading hampered our ability to properly carry out
our statutory responsibilities and consumed scarce Commission
resources. Accordingly, we conclude that Syntax-Brillian is apparently
liable for an $11,000 forfeiture.
V. conclusion
47. We have examined Syntax-Brillian's NAL Response pursuant to the
statutory factors prescribed by Section 503(b)(2)(E) of the Act and in
conjunction with the Forfeiture Policy Statement. As a result of our
review, we conclude that Syntax-Brillian willfully and repeatedly
violated Sections 15.117(i)(1)(i) and (ii) of the Commission's Rules,
by importing into the United States and shipping interstate DTV
receivers that do not comply with the DTV tuner requirement. We also
find that Syntax-Brillian is not entitled to any reduction of the
forfeiture amount proposed in the NAL, except as discussed above with
respect to those units found to have been shipped intrastate rather
than interstate and those units imported into the United States.
Further, we find Syntax-Brillian apparently liable for willful
violation of Section 1.17(a)(2) for providing incorrect or misleading
material factual information without a reasonable basis for believing
the information was correct and not misleading. We propose a
forfeiture of $11,000 for this violation.
VI. ordering clauses
48. Accordingly, IT IS ORDERED that, pursuant to Section 503(b) of the
Act, and Section 1.80 of the Rules, Syntax-Brillian Corporation, IS
LIABLE FOR A MONETARY FORFEITURE in the amount of one million, two
hundred sixty six thousand, one hundred dollars ($1,266,100) for
willfully and repeatedly violating Sections 15.117(i)(1)(i) and (ii)
of the Rules.
49. Payment of the forfeiture shall be made in the manner provided for in
Section 1.80 of the Rules within 30 days of the release of this Order.
If the forfeiture is not paid within the period specified, the case
may be referred to the Department of Justice for collection pursuant
to Section 504(a) of the Act. 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 the 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. A request for
full payment under an installment plan should be sent to: Associate
Managing Director - Financial Operations, 445 12th Street, SW, Room
1-A625, Washington, D.C. 20554.
50. IT IS FURTHER ORDERED that, pursuant to Section 503(b) of the Act, and
Section 1.80 of the Rules, Syntax-Brillian Corporation, IS hereby
NOTIFIED of its APPARENT LIABILITY FOR A FORFEITURE in the amount of
eleven thousand dollars ($11,000) for its apparent willful violation
of Section 1.17(a)(2) of the Rules.
51. IT IS FURTHER ORDERED that, pursuant to Section 1.80 of the Rules,
within thirty days of the release date of this Further Notice of
Apparent Liability for Forfeiture, Syntax-Brillian Corporation SHALL
PAY the full amount of the proposed forfeiture or SHALL FILE a written
statement seeking reduction or cancellation of the proposed
forfeiture.
52. 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.
53. The response to the forfeiture proposed for Syntax-Brillian's apparent
violation of Section 1.17(a)(2) of the Rules, 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.
54. 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 submitted.
55. IT IS FURTHER ORDERED that a copy of this Order shall be sent by First
Class Mail and Certified Mail Return Receipt Requested to Mr. Vincent
F. Sollitto, Chairman and CEO, Syntax-Brillian Corporation, 1600 N.
Desert Drive, Tempe, AZ, 85281 and Andrew M. Beato, Esq., Stein,
Mitchell & Mezines, L.L.P., 1100 Connecticut Avenue, N.W., Washington,
D.C. 20036.
FEDERAL COMMUNICATIONS COMMISSION
Marlene H. Dortch
Secretary
47 C.F.R. S:S: 15.117(i)(1)(i) and 15.117(i)(1)(ii).
47 C.F.R. S: 1.17(a)(2).
Review of the Commission's Rules and Policies Affecting the Conversion to
Digital Television, Second Report and Order and Second Memorandum Opinion
and Order, 17 FCC Rcd 15978, 15996 P: 40 (2002) ("DTV Review Second Report
and Order").
DTV reception capability involves more circuitry than just a tuner. To
provide this capability requires a tuner to receive the digital signal, an
MPEG decoder/formatter, and associated processing capability and memory.
See Requirements for Digital Television Receiving Capability, Report and
Order and Further Notice of Proposed Rulemaking, 20 FCC Rcd 11196, 11196
P: 1 n. 2 (2005) ("DTV Tuner Report and Order").
DTV Review Second Report and Order, 17 FCC Rcd at 15996 P: 40. The DTV
tuner requirement also applies to other devices such as television
interface devices that do not include a viewing screen, e.g., devices such
as VCRs and DVD players that are intended to provide audio-video signals
to a video monitor and that have an antenna or antenna terminals that can
be used for off-the-air television reception. See 47 C.F.R. S:
15.117(i)(1)(i).
Id. at 15979. In this latter regard, the DTV tuner requirement ensures
that the intent of the All Channel Receiver Act of 1962 ("ACRA"), P.L. No.
87-529, 76 Stat. 150, is fulfilled. The ACRA, which is codified at 47
U.S.C. S: 303(s), states that the Commission shall "[h]ave authority to
require that apparatus designed to receive television pictures broadcast
simultaneously with sound be capable of adequately receiving all
frequencies allocated by the Commission to television broadcasting." See
DTV Review Second Report and Order, 17 FCC Rcd at 15589 P: 24 n. 44.
Id. at 15996 P: 40.
Id. at 15996-97 P: 41.
In June 2005, the Commission modified the rules to advance the date on
which 100% of new television receivers with screen sizes 25-36" that are
imported or shipped interstate must include DTV tuners from July 1, 2006
to March 1, 2006. DTV Tuner Report and Order, 20 FCC Rcd at 11203 P: 16.
Subsequently, in November 2005, the Commission modified the rules to
advance the date on which 100% of new television receivers with screen
sizes 13-24" and certain other television receiving devices such as VCRs
and digital video recorders that are imported or shipped interstate must
include DTV tuners from July 1, 2007 to March 1, 2007. See Requirements
for Digital Television Receiving Capability, Second Report and Order, 20
FCC Rcd 18607, 18614 P: 19 (2005) ("DTV Tuner Second Report and Order").
The Commission also amended the rules to apply the DTV tuner requirement
to new receivers with screen sizes smaller than 13" on this same schedule.
Id. at 18616 P: 25.
The DTV tuner requirement applies to "responsible parties," as defined in
Section 2.909 of the Rules. 47 C.F.R. S: 2.909. Under Section 2.909, the
party responsible for equipment such as television receivers that is
subject to our "verification" equipment authorization procedure is the
manufacturer or, in the case of imported equipment, the importer. If
subsequent to manufacture and importation, the equipment is modified by
any party not working under the authority of the responsible party, the
party performing the modification becomes the new responsible party.
No radio frequency device may be imported into the Customs territory of
the United States unless the importer or ultimate consignee declares that
the device meets one of the conditions for entry specified in Section
2.1204 of the Rules, 47 C.F.R. S: 2.1204. See 47 C.F.R. S: 2.1203. Such
import declarations are filed with the U.S. Customs and Border Patrol on
FCC Form 740, or electronically where electronic filing is available. 47
C.F.R. S: 2.1205. The Enforcement Bureau, in turn, receives this
importation data from Customs and uses it to monitor compliance with the
DTV tuner requirements and other requirements applicable to radio
frequency devices.
See Letter from Kathryn S. Berthot, Chief, Spectrum Enforcement Division,
Enforcement Bureau to Vincent F. Sollitto, Jr., Chairman and CEO,
Syntax-Brillian U.S.A., Inc. (March 8, 2007) ("LOI").
See Letter from Andrew M. Beato, Esq. Counsel for Syntax-Brillian U.S.A.,
Inc. to Kathryn Berthot, Spectrum Enforcement Division, Enforcement Bureau
(March 19, 2007) ("LOI Response").
See Syntax-Brillian Corporation, Notice of Apparent Liability for
Forfeiture, 22 FCC Rcd 10530 (2007) ("NAL").
See Reply in Opposition to Notice of Apparent Liability for Forfeiture
(October 31, 2007) ("NAL Response").
"HDTV-ready" or "HD-ready" generally refers to television monitors or
receivers that can display HDTV programming when attached to a separate
HDTV tuner, HD cable set-top box or HD satellite set-top-box receiver.
Syntax-Brillian also asserts that the DTV tuner requirement is beyond the
scope of the Commission's authority. NAL Response at 7, n. 3. Since
Syntax-Brillian makes no argument on this point beyond this assertion, we
will not address this issue further.
47 U.S.C. S: 503(b).
47 C.F.R. S: 1.80.
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 (1997), recon. denied, 15 FCC Rcd 303 (1999) ("Forfeiture
Policy Statement").
47 U.S.C. S: 503(b)(2)(E).
NAL Response at 25.
See 47 U.S.C. S: 503(b)(5); see also 47 C.F.R. 1.80(d).
NAL Response at 25.
47 C.F.R. S: 15.101(a).
47 C.F.R. S: 2.902.
47 C.F.R. S: 2.909(b).
See 47 C.F.R. S:S: 2.901-2.1093.
See, e.g., 47 C.F.R. S: 15.101(a).
See generally 47 C.F.R. S:S: 15.101-15.123.
See 47 C.F.R. S: 2.952.
See 47 C.F.R. S: 2.955.
See 47 C.F.R. S: 2.956.
See 47 C.F.R. S:S: 2.954, 15.19 and 15.21.
47 C.F.R. S: 15.101(a); see also Behringer USA, Inc., Notice of Apparent
Liability for Forfeiture, 21 FCC Rcd 1820, 1825 P: 15 (2006), forfeiture
ordered, 22 FCC Rcd 10451 (2007) ("Behringer") (forfeiture paid).
See Communications Act Amendments of 1978, Pub. L. No. 95-234, 92 Stat. 33
(1978).
S. Rep. No. 95-580, at 1 (1977).
Id. at 2, 6.
See 47 C.F.R. S: 2.907.
S. Rep. No. 95-580, at 9.
See Amendment of the Regulations to Expand the Notification and
Verification Equipment Authorization Procedures, Report and Order, 96 FCC
2d 948, 949 (1984) ("Verification Report and Order").
Id. at 954.
Id. at 953. Cf. Amendment of Part 76 of the Commission's Rules and
Regulations Concerning the Cable Television Certificate of Compliance
Process, Report and Order, 69 FCC 2d 697, 704 (1978) (clarifying that the
registration statement adopted for cable television operators in lieu of
the certification process was sufficient authorization under Section 503
such that a forfeiture may be imposed without prior issuance of a
citation). See also Implementation of P.L. 97-257, Amendment of Section
1.80(d) of the Commission's Rules and Regulations, Letter, 100 FCC 2d 968,
970 (1985) (affirming the denial of a petition for declaratory ruling
seeking a ruling that, prior to the 1982 amendments to Section 503, cable
operators were entitled to the initial warning protections provided in
Section 503(b)(5) because they were not in the category of "licensees,
permittees, holders of certificates, or of other authorizations" listed in
that subsection).
We note that the Commission has never previously addressed the legislative
history set forth above or determined whether verification constitutes an
"authorization" for purposes of Section 503(b)(5). To the extent that FCC
precedent suggests a conclusion contrary to the one that we reach here, we
hereby overrule such precedent on the basis of the preceding analysis.
See, e.g., Implementation of Sections 255 and 251(a)(2) of the
Communications Act of 1934, 16 FCC Rcd 6417, 6464-65 (1999) (explaining
that, for purposes of assessing forfeitures for violations of Section 255,
a manufacturer "who does not hold any authorization from the Commission
and is not otherwise engaged in activity for which such authorization is
required is in a markedly different position than a common carrier against
whom the Commission may assess a forfeiture for section 255 violations
without first issuing a citation and providing an opportunity for
corrective action."); In the Matter of Rocky Mountain Radar, 12 FCC Rcd
22453 (1997) (citation issued for manufacture and marketing of radar
jamming devices in violation of Act and Commission rules) (subsequent
history omitted).
NAL Response at 31.
Id. at 32 (emphasis added).
Id.
Id. (quoting DTV Review Second Report and Order, 17 FCC Rcd at 16003 P:
56).
Id. (quoting DTV Review Second Report and Order, 17 FCC Rcd at 16003-4 P:
56, 59).
Id. at 33-34.
Id. at 34.
Id.
47 C.F.R. S: 15.117(i)(1). See supra P:P: 2-3.
DTV Review Second Report and Order, 17 FCC Rcd at 16003 P: 56 and n. 86
(emphasis added).
See DTV Tuner Report and Order, 20 FCC Rcd at 11204 P: 19; Second Periodic
Review of the Commission's Rules and Policies Affecting the Conversion to
Digital Television, Report and Order, 19 FCC Rcd 18279, 18351-53 P:P:
166-68 (2004) ("Second Periodic Review").
See Second Periodic Review of the Commission's Rules and Policies
Affecting the Conversion to Digital Television, Second Report and Order,
22 FCC Rcd 8776 , 8782-83 P: 3 (2007) ("Second Periodic DTV Review 2007").
NAL Response at 34-37, citing http://www.dtv.gov/dtvtipsheet.pdf (stating
that "DTV equipment may be purchased as an all-in-one or component
solution. `Integrated' DTV sets with built-in tuners are an all-in-one
solution for DTV - they include a digital tuner to receive over-the-air
DTV broadcasts and a monitor to display the programming. A `component'
solution includes a DTV monitor (screen) without a DTV tuner (these
monitors are sometimes labeled `HD Ready'). Monitors must be paired with a
cable or satellite set-top box, or stand-alone DTV tuner.").
http://www.dtv.gov/dtvtipsheet.pdf.
NAL Response at 40.
Id.
Id. at 40-41.
47 C.F.R. S: 1.429(d).
The DTV Tuner Report and Order was published in the Federal Register on
July 6, 2005. See 70 Fed. Reg. 38800 (July 6, 2005). Therefore, a timely
petition for reconsideration of the DTV Tuner Report and Order should have
been filed not later than August 5, 2005.
See, e.g., MCI Telecommunications Corp. v. Pacific Northwest Bell
Telephone Co., Memorandum Opinion and Order, 5 FCC Rcd 216, 228, n.38
(1990), recon. denied, 5 FCC Rcd 3463 (1990), appeal dismissed sub nom.
Mountain States Tel. and Tel. Co. v. FCC, 951 F.2d 1259 (10th Cir. 1991)
(per curiam).
DTV Tuner Report and Order, 20 FCC Rcd at 11196 P: 1.
Id. at 11204 P: 20.
See also infra P:P: 41-42.
NAL Response at 44.
See supra P:P: 13-15.
See, e.g., General Elec. Co. v. U.S. E.P.A., 53 F.3d 1324, 1329 (D.C. Cir.
1995) (under fair notice principle, which is grounded in due process but
has now been incorporated into administrative law, an agency may impose
civil or criminal liability provided that "a regulated party acting in
good faith would be able to identify, with `ascertainable certainty,' the
standards with which the agency expects parties to conform." (citing
Satellite Broadcasting Co. v. FCC, 824 F.2d 1, 3 (D.C. Cir. 1987); Diamond
Roofing Company, Inc. v. Occupational Safety and Health Review Comm'n, 528
F.2d 645, 649 (5th Cir. 1976)).
Id. at 48.
Id.
See Forfeiture Policy Statement, 12 FCC Rcd at 17092-93 P: 8.
See Forfeiture Policy Statement, 12 FCC Rcd at 17099 P: 23; see also 47
C.F.R. S:1.80(b)(4) ("The Commission and its staff may use these
guidelines in particular cases [, and] retain the discretion to issue a
higher or lower forfeiture than provided in the guidelines, to issue no
forfeiture at all, or to apply alternative or additional sanctions as
permitted by the statute.") (emphasis added).
NAL, 22 FCC Rcd at 10534-35 P: 11.
See 47 U.S.C. S: 503(b); 47 C.F.R. S: 1.80(a), (b); see also Forfeiture
Policy Statement, 12 FCC Rcd at 17100-1
P: 27.
See Globcom, Inc. d/b/a Globom Global Commun., Order of Forfeiture, 21 FCC
Rcd 4710, 4723 P: 35 (2006) ("Globcom").
NAL Response at 49.
Id. at 49-50 (citing NAL, 22 FCC Rcd at 10535 n. 39). We address
Syntax-Brillian's arguments concerning the calculation of the number of
violations at P:P: 31-35, infra.
NAL, 22 FCC Rcd at 10535 P: 13.
Id.
NAL Response at 50-51.
Id.
See also infra P: 33.
NAL Response at 51.
NAL, 22 FCC Rcd at 10534-35 P: 11.
NAL Response at 51.
Id. We note that the NALs cited by Syntax-Brillian were issued by the
Enforcement Bureau, not the Commission. See, e.g., RadioShack Corporation,
Notice of Apparent Liability for Forfeiture, 22 FCC Rcd 18437 (Enf. Bur.
2007) (response received).
Second Periodic DTV Review 2007, 22 FCC Rcd at 8784 P: 14.
Id. at 52 (citing Forfeiture Policy Statement, 12 FCC Rcd at 17101 P: 29
("the predictability in the forfeiture process is an important objective
and adherence to the guidelines is a method to achieve this goal")).
See, e.g., InPhonic, Inc., Order of Forfeiture and Further Notice of
Apparent Liability, 22 FCC Rcd 8689, 8699
P: 24 (2007); Globcom, 21 FCC Rcd at 4723-24 P:P: 36-37.
See NAL, 22 FCC Rcd at 10535 n. 36 (noting that "this forfeiture
calculation methodology is consistent and predictable when applied to
different factual scenarios").
NAL Response at 53.
Id.
Id. at 53-55.
Id. at 5755-56 (citing Webnet Communications, Inc. Notice of Apparent
Liability for Forfeiture, 17 FCC Rcd 11603 (2002); Vista Group
International, Inc., Notice of Apparent Liability for Forfeiture, 14 FCC
Rcd 13814 (1999); All American Telephone Company, Inc., Notice of Apparent
Liability for Forfeiture, 13 FCC Rcd 15040 (1998); Amer-I-Net Services
Corporation, Notice of Apparent Liability for Forfeiture, 13 FCC Rcd 22055
(1998); Brittan Communications International Corp., Notice of Apparent
Liability for Forfeiture, 14 FCC Rcd 296 (1998); NOS Communications, Inc.
and Affinity Network Incorporated, Notice of Apparent Liability for
Forfeiture 16 FCC Rcd 8133 (2001); and Business Discount Plan, Notice of
Apparent Liability for Forfeiture, 14 FCC Rcd 340 (1998)).
Behringer, 21 FCC Rcd at 1823 P: 8; 22 FCC Rcd at 10459 P: 18.
NAL, 22 FCC Rcd at 10535 P: 13.
NAL Response at 53, n. 91. The Eighth Amendment states: "Excessive bail
shall not be required, nor excessive fines imposed, nor cruel and unusual
punishments inflicted." U.S. Const. amend. VIII.
534 U.S. 321 (1998) ("Bajakajian"). Syntax-Brillian also cites Austin v.
United States, 509 U.S. 602, 622-623 (1993) ("Austin") (remanding the case
to the Court of Appeals after finding the Court of Appeals should have
considered petitioner's claims that the forfeiture was excessive within
the meaning of the Eight Amendment) and Alexander v. United States, 509
U.S. 544, 559 (1993) ("Alexander") (addressing only the question of
whether the Eighth Amendment applied and, finding that it did, remanding
the case to the Court of Appeals). Neither Austin nor Alexander provides
any support for Syntax-Brillian's argument that the NAL's proposed
forfeiture violates the Eighth Amendment as they do not discuss the
standard to be used to make this determination.
Bajakajian, 534 U.S. at 339-340.
NAL Response at 30 (citing Tolling Agreement, File No. EB-07-SE-023,
executed by and between William H. Davenport, Assistant Chief, Enforcement
Bureau, Federal Communications Commission, and Michael J. Miller, General
Counsel, Syntax-Brillian Corporation (April 30, 2007) ("Tolling
Agreement")).
Id.
Id.
In its response to questions 1(c) and 2(c) of the LOI, which requested the
number of certain mid-size receivers shipped interstate, Syntax-Brillian
stated that the total number of receivers "shipped interstate after March
1, 2006, is identified in Exhibit 2." LOI Response at 2, 6 (emphasis
added). Similarly, in response to question 3(c) of the LOI, which
requested the total number of large-size receivers shipped interstate,
Syntax-Brillian stated "See Exhibit 3." LOI Response at 8. Nowhere in its
LOI Response did Syntax-Brillian state that either Exhibit 2 or Exhibit 3
also included intrastate shipments. Further, Syntax-Brillian did not
explain in its NAL Response why it included intrastate shipments in its
LOI Response.
NAL Response at 30.
Id.
It appears that the NAL erroneously included certain negative importations
listed by Syntax-Brillian in its LOI response, i.e., television receivers
that were imported into the United States but then were subsequently
exported. Exclusion of these receivers results in a reduction of the total
number of receivers imported from 7, 175 to 4,856.
In its NAL Response, Syntax-Brillian provided documentation, including
invoices, packing lists and purchase orders, which indicate that 1,390
units that it had listed as imports in its LOI Response were in fact
shipped to Hong Kong, rather than the United States.
See supra P: 23.
NAL Response at 30, 61.
Id. at 61 (where Syntax-Brillian states that it "performed" by executing
the Tolling Agreement based on its understanding that this meant no NAL
would issue).
In the Matter of Local Phone Service, Inc., Notice of Apparent Liability
for Forfeiture, 21 FCC Rcd 9974, 9976-79 P: 5, n. 19 and P: 13 (2006)
("Local Phone Service NAL").
Tolling Agreement at P: 6(c).
Id. at P: 6(a).
Specifically, the staff had requested that Syntax-Brillian provide
information regarding its importation and interstate shipment of its Model
LT20S receiver, a 20" television receiver that includes an analog tuner.
According to Customs importation data, Syntax-Brillian imported 788 units
of the LT20S receiver on March 3, 2007, after the March 1, 2007 deadline
to cease importing non-DTV-compliant receivers with screen sizes less than
25". Subsequent to issuance of the NAL, Syntax-Brillian confirmed that it
did import units of the LT20S receiver after March 1, 2007, but indicated
that these units were distributed to Syntax-Brillian employees and were
not sold. Since these units were not imported for sale in the United
States, they do not come within the purview of Section 15.117(i)(1)(iii).
See, e.g., Local Phone Service NAL, 21 FCC Rcd at 9976 P: 5, n. 19.
NAL Response at 30.
We derived this amount as follows: (1000 units * $50/unit) + (1500 units *
$75/unit) + (2500 units * $100/unit) + (5000 units * $125/unit) + (1,524
units * $150/unit) = $1,266,100. See NAL, 22 FCC Rcd at 10535 P: 13-15.
NAL Response at 58-60.
NAL Response at 58-60.
See Forfeiture Policy Statement, 12 FCC Rcd at 17099 P: 23; see also 47
C.F.R. S:1.80(b)(4) ("The Commission and its staff may use these
guidelines in particular cases [, and] retain the discretion to issue a
higher or lower forfeiture than provided in the guidelines, to issue no
forfeiture at all, or to apply alternative or additional sanctions as
permitted by the statute.") (emphasis added).
See, e.g., SBC Communications, Inc. v. FCC, 373 F.3d 140, 151-52 (D.C.
Cir. 2004) (finding that, even though the FCC considered, but may not have
assigned any weight to, each of the factors in section 503(b)(2)(E), as
long as there is a "rational relationship between [the factors used] and
the extent of the fine" its application of the statutory factors is
reasonable).
NAL, 22 FCC Rcd at 10535 P: 13.
Id. at 10535-36 P: 15.
See, e.g., All American Telephone, Inc., Forfeiture Order, 16 FCC Rcd
16601, 16609-10 P: 19 (2001) (history of compliance not a mitigating
factor warranting reduction of forfeitures assessed for slamming
violations by a common carrier because of the egregious nature of the
violations).
See e.g., United States Cellular Corporation, Notice of Apparent Liability
for Forfeiture, 22 FCC Rcd 16424 P: 14 (2007) (remedial efforts taken by a
wireless carrier after the deadline for compliance with the E911 95
percent handset penetration requirement not a mitigating factor warranting
reduction of forfeiture) (forfeiture paid); AT&T Wireless Services, Inc.,
Forfeiture Order, 17 FCC Rcd 21866, 21875-6 P:P: 26-28 (2002) (remedial
action to correct tower painting violation was not a mitigating factor
warranting reduction of forfeiture); Seawest Yacht Brokers, Forfeiture
Order, 9 FCC Rcd 6099, 6099 P: 7 (1994) (corrective action taken to comply
with the Rules is expected, and does not mitigate any prior forfeitures or
violations).
NAL Response at 59.
Forfeiture Policy Statement, 12 FCC Rcd at 17098 P: 21; see also 47 C.F.R.
S: 1.17.
NAL Response at 50 n. 85, 59-60.
Id. at 50 n. 85 (citing Second Periodic DTV Review 2007 at P: 14).
Id. at P: 1.
Id. at P:P: 4-5, 11-12.
NAL Response at 58, 60.
According to Syntax-Brillian's website, the Syntax Groups Corporation was
founded in May 2003 and the Brillian Corporation was founded in 1997. See
http://www.syntaxbrillian.com/company/history.html.
NAL, 22 FCC Rcd at 10537 P: 19.
See supra P: 18; see also DTV Tuner Report and Order, 20 FCC Rcd at 11196
P:P: 1, 20.
Id. at 11203 P: 17.
47 C.F.R. S: 1.17(a)(2).
47 C.F.R. S: 1.17(b)(4).
In the Matter of Amendment of Section 1.17 of the Commission's Rules
Concerning Truthful Statements to the Commission, Report and Order, 18 FCC
Rcd 4016, 4016-17 P: 1-2, 4021 P: 12 (2003), recon. denied, Memorandum
Opinion and Order, 19 FCC Rcd 5790, further recon. denied, Memorandum
Opinion and Order, 20 FCC Rcd 1250 (2004) ("Amendment of Section 1.17").
See id. at 4017 P: 2 (stating that the revision to Section 1.17 is
intended to "prohibit incorrect statements or omissions that are the
result of negligence, as well as an intent to deceive").
NAL Response at 30; see also supra P:P: 31-35.
NAL Response at 30.
LOI Response at 2, 6, and 8.
NAL Response at 30, Exhibit 1.
Amendment of Section 1.17, 18 FCC Rcd at 4021 P: 12.
See, e.g., In re Applications of Citicasters License, L.P., et al.,
Memorandum Opinion and Order and Notice of Apparent Liability, 22 FCC Rcd
19324, 19338 P: 40 (2007) (forfeiture paid) (finding that a licensee's
false certification that it had not violated the Act or any Commission
rules during the preceding license term had no reasonable basis but was
not made with the intent to deceive Commission and, therefore, violated
Section 1.17(a)(2) of the rules) ("Citicasters").
47 U.S.C. S: 503(b)(1)(B); 47 C.F.R. S: 1.80(a)(1).
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).
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. 47 U.S.C. S: 312(f)(1). The legislative history of
Section 312(f)(1) of the Act clarifies that this definition of willful
applies to both Sections 312 and 503(b) of the Act, H.R. Rep. No. 97-765,
97th Cong. 2d Sess. 51 (1982), and the Commission has so interpreted the
term in the Section 503(b) context. See Southern California Broadcasting
Co., Memorandum Opinion and Order, 6 FCC Rcd 4387, 4388 (1991), recon.
denied, 7 FCC Rcd 3454 (1992) ("Southern California").
See Forfeiture Policy Statement, 12 FCC Rcd at 17113; 47 C.F.R. S:
1.80(b)(4), Note to Paragraph (b)(4): Section I. Base Amounts for Section
503 Forfeitures.
See 47 U.S.C. S: 503(b)(2)(D) (setting forth the statutory maximum
forfeiture for entities other than broadcasters and common carriers). See
also 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 forfeiture amounts for entities other than
broadcasters and common carriers to $11,000/$97,500). See also
Citicasters, 22 FCC Rcd at 19339 P: 43 (using the base forfeiture amount
for misrepresentation/lack of candor as the base forfeiture for violation
of Section 1.17 of the rules).
See Forfeiture Policy Statement, 12 FCC Rcd at 17100; 47 C.F.R. S:
1.80(b)(4).
In the Matter of Amendment of Section 1.17 of the Commission's Rules
Concerning Truthful Statements to the Commission, Notice of Proposed
Rulemaking,17 FCC Rcd, 3296, 3297 P: 3 (2002).
47 U.S.C. S: 503(b).
47 C.F.R. S: 1.80.
47 U.S.C. S: 504(a).
See 47 C.F.R. S: 1.1914.
Id.
(Continued from previous page)
(continued....)
Federal Communications Commission FCC 08-109
3
Federal Communications Commission FCC 08-109