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Before the
Federal Communications Commission
Washington, D.C. 20554
)
)
)
In the Matter of
) File No. EB- 06-TC-120
Hot Lead LLC
) NAL/Acct. No. 20093217007
d/b/a The Hot Lead Company
) FRN: 0016773533
Apparent Liability for Forfeiture
)
)
)
NOTICE OF APPARENT LIABILITY FOR FORFEITURE
Adopted: December 9, 2008 Released: December 9, 2008
By the Commission:
I. INTRODUCTION
1. In this Notice of Apparent Liability for Forfeiture ("NAL"), we find
that The Hot Lead LLC ("Hot Lead") apparently willfully or repeatedly
violated section 227 of the Communications Act of 1934, as amended
("Act"), and the Commission's related rules and orders, by delivering
at least nine unsolicited advertisements to the telephone facsimile
machines of at least nine consumers. Based on the facts and
circumstances surrounding these apparent violations, we find that Hot
Lead is apparently liable for a forfeiture in the amount of $51,500.
II. BACKGROUND
2. Section 227(b)(1)(C) of the Act makes it "unlawful for any person
within the United States, or any person outside the United States if
the recipient is within the United States . . . to use any telephone
facsimile machine, computer, or other device to send, to a telephone
facsimile machine, an unsolicited advertisement." The term
"unsolicited advertisement" is defined in the Act and the Commission's
rules as "any material advertising the commercial availability or
quality of any property, goods, or services which is transmitted to
any person without that person's prior express invitation or
permission in writing or otherwise." Under the Commission's rules, an
"established business relationship" exception permits a party to
deliver a message to a consumer if the sender has an established
business relationship with the recipient and the sender obtained the
number of the facsimile machine through the voluntary communication by
the recipient, directly to the sender, within the context of the
established business relationship, or through a directory,
advertisement, or a site on the Internet to which the recipient
voluntarily agreed to make available its facsimile number for public
distribution.
3. On May 5, 2006, in response to one or more consumer complaints
alleging that Hot Lead had faxed unsolicited advertisements, the
Enforcement Bureau ("Bureau") issued a citation to Hot Lead, pursuant
to section 503(b)(5) of the Act. The Bureau staff cited Hot Lead for
using a telephone facsimile machine, computer, or other device, to
send unsolicited advertisements for mortgage financing, health and
life insurance, credit and debit card services, interior shutters,
custom-logo shirts/T-shirts, fax advertising and sales leads to
telephone facsimile machines, in violation of section 227 of the Act
and the Commission's related rules and orders. The citation warned Hot
Lead that subsequent violations could result in the imposition of
monetary forfeitures of up to $11,000 per violation, and included a
copy of the consumer complaints that formed the basis of the citation.
The citation informed Hot Lead that within 30 days of the date of the
citation, it could either request an interview with Commission staff,
or could provide a written statement responding to the citation. Hot
Lead did not request an interview or otherwise respond to the
citation.
4. Despite the citation's warning that subsequent violations could result
in the imposition of monetary forfeitures, we have received additional
consumer complaints indicating that Hot Lead continued to engage in
such conduct. We base our action here specifically on complaints filed
by nine consumers establishing that Hot Lead continued to send nine
unsolicited advertisements to telephone facsimile machines after the
date of the citation.
5. Section 503(b) of the Act authorizes the Commission to assess a
forfeiture for each violation of the Act, or of any rule, regulation,
or order issued by the Commission under the Act, by a non-common
carrier or other entity not specifically designated in section 503 of
the Act. The maximum penalty for such a violation is $11,000 for a
violation occurring before September 2, 2008, and $16,000 for a
violation occurring on or after September 2, 2008. In exercising such
authority, we are to 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."
III. DISCUSSION
A. Violations of the Commission's Rules Restricting Unsolicited Facsimile
Advertisements
6. We find that Hot Lead apparently violated section 227 of the Act and
the Commission's related rules and orders by using a telephone
facsimile machine, computer, or other device to send at least nine
unsolicited advertisements to the nine consumers identified in the
Appendix. This NAL is based on evidence that nine consumers received
unsolicited fax advertisements from Hot Lead after the Bureau's
citation. The facsimile transmissions advertise mortgages, health
care, vacations, and shirts. Further, according to the complaints, the
consumers neither had an established business relationship with Hot
Lead nor gave Hot Lead permission to send the facsimile transmissions.
The faxes at issue here therefore fall within the definition of an
"unsolicited advertisement." Based on the entire record, including
the consumer complaints, we conclude that Hot Lead apparently violated
section 227 of the Act and the Commission's related rules and orders
by sending nine unsolicited advertisements to nine consumers'
facsimile machines.
B. Proposed Forfeiture
7. We find that Hot Lead is apparently liable for a forfeiture in the
amount of $51,500. Although the Commission's Forfeiture Policy
Statement does not establish a base forfeiture amount for violating
the prohibition against using a telephone facsimile machine to send
unsolicited advertisements, the Commission has previously considered
$4,500 per unsolicited fax advertisement to be an appropriate base
amount. We apply that base amount to each of seven of the apparent
violations. In addition, where the consumer requests the company to
stop sending facsimile messages, and the company continues to send
them, the Commission has previously considered $10,000 per unsolicited
fax advertisement the appropriate forfeiture for such egregious
violations. Here, two consumers specifically requested that Hot Lead
cease sending facsimiles. Notwithstanding these requests, an
additional two facsimiles were sent to these consumers. We therefore
apply the $10,000 amount to each of these two apparent violations.
Thus, a total forfeiture of $51,500 is proposed. Hot Lead will have
the opportunity to submit evidence and arguments in response to this
NAL to show that no forfeiture should be imposed or that some lesser
amount should be assessed.
IV. CONCLUSION AND ORDERING CLAUSES
8. We have determined that The Hot Lead LLC apparently violated section
227 of the Act and the Commission's related rules and orders by using
a telephone facsimile machine, computer, or other device to send at
least nine unsolicited advertisements to the nine consumers identified
in the Appendix. We have further determined that The Hot Lead LLC is
apparently liable for a forfeiture in the amount of $51,500.
9. Accordingly, IT IS ORDERED, pursuant to section 503(b) of the Act, 47
U.S.C. S: 503(b), and section 1.80 of the rules, 47 C.F.R. S: 1.80,
that The Hot Lead LLC is hereby NOTIFIED of this APPARENT LIABILITY
FOR A FORFEITURE in the amount of $51,500 for willful or repeated
violations of section 227(b)(1)(C) of the Communications Act, 47
U.S.C. S: 227(b)(1)(C), sections 64.1200(a)(3) of the Commission's
rules, 47 C.F.R. S: 64.1200(a)(3), and the related orders described in
the paragraphs above.
10. IT IS FURTHER ORDERED THAT, pursuant to section 1.80 of the
Commission's rules, within twenty (20) days of the release date of
this Notice of Apparent Liability for Forfeiture, The Hot Lead LLC
SHALL PAY the full amount of the proposed forfeiture or SHALL FILE a
written statement seeking reduction or cancellation of the proposed
forfeiture.
11. 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). The Hot Lead LLC will also send
electronic notification on the date said payment is made to
Johnny.drake@fcc.gov. 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.
12. The response, if any, must be mailed both to the Office of the
Secretary, Federal Communications Commission, 445 12th Street, SW,
Washington, DC 20554, ATTN: Enforcement Bureau - Telecommunications
Consumers Division, and to Colleen Heitkamp, Chief, Telecommunications
Consumers Division, Enforcement Bureau, Federal Communications
Commission, 445 12th Street, SW, Washington, DC 20554, and must
include the NAL/Acct. No. referenced in the caption.
13. 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.
14. IT IS FURTHER ORDERED that a copy of this Notice of Apparent Liability
for Forfeiture shall be sent by Certified Mail Return Receipt
Requested and by regular mail to: The Hot Lead LLC, Attention: Mr.
Greg Horne, 16901 Dallas Parkway, Addison, Texas 75001; The Hot Lead
Company, Attention: Mr. Greg Horne, 1400 Preston Road #300, Plano,
Texas 75903; and The Hot Lead Company, Attention: Mike Horne, Manager,
PO Box 12057, Las Vegas, NV 89112.
FEDERAL COMMUNICATIONS COMMISSION
Marlene H. Dortch
Secretary
APPENDIX
Complainants and Violation Dates
Complainant received facsimile advertisements Violation Date(s)
Kim Donaldson 12/11/2007
Carrie Balkcom 12/15/2007
Michael Wallworck 12/21/2007
Albert Chi 12/21/2007
Heather Halliday 12/22/2007
Michael Garcia 12/30/2007
Jim Cole 12/31/2007
Complainant received facsimile advertisements Violation Date(s)
after requesting no more be sent
Joe Agrusa 12/12/2007
Jeff Deakins, CSX Transportation 12/22/2007
See 47 U.S.C. S: 503(b)(1). The Commission has the authority under this
section of the Act to assess a forfeiture against any person who has
"willfully or repeatedly failed to comply with any of the provisions of
this Act or of any rule, regulation, or order issued by the Commission
under this Act ...." See also 47 U.S.C. S: 503(b)(5) (stating that the
Commission has the authority under this section of the Act to assess a
forfeiture penalty against any person who does not hold a license, permit,
certificate or other authorization issued by the Commission or an
applicant for any of those listed instrumentalities so long as such person
(A) is first issued 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 nearest to the person's
place of residence; and (C) subsequently engages in conduct of the type
described in the citation).
According to publicly available information, Hot Lead is also doing
business as The Hot Lead Company. Therefore, all references in this NAL to
"Hot Lead" encompass Hot Lead as well as The Hot Lead Company. Hot Lead
has offices at 16901 Dallas Parkway, Addison, Texas 75001. The Hot Lead
Company has offices at 1400 Preston Road #300, Plano, Texas 75903. Mr.
Greg Horne, is listed as the contact person for both Hot Lead and The Hot
Lead Company. Hot Lead also lists as a principal Mike Horne, Manager, PO
Box 12057, Las Vegas, NV 89112. Accordingly, all references in this NAL to
"Hot Lead" also encompass the foregoing individuals and all other
principals and officers of the entity noted herein, as well as the
corporate entities themselves.
See 47 U.S.C. S: 227(b)(1)(C); 47 C.F.R. S: 64.1200(a)(3); see also
Rules and Regulations Implementing the Telephone Consumer Protection Act
of 1991, Report and Order and Third Order on Reconsideration, 21 FCC Rcd
3787 (2006).
47 U.S.C. S: 227(b)(1)(C); 47 C.F.R. S: 64.1200(a)(3).
47 U.S.C. S: 227(a)(4); 47 C.F.R. S: 64.1200 (f)(13).
An "established business relationship" is defined as a prior or existing
relationship formed by a voluntary two-way communication "with or without
an exchange of consideration, on the basis of an inquiry, application,
purchase or transaction by the business or residential subscriber
regarding products or services offered by such person or entity, which
relationship has not been previously terminated by either party." 47
C.F.R. S: 64.1200(f)(5).
See 47 U.S.C. S: 227(b)(1)(C); 47 C.F.R. S: 64 (a)(3)(i), (ii).
Citation from Kurt A. Schroeder, Deputy Chief, Telecommunications
Consumers Division, Enforcement Bureau, File No. EB-06-TC-120 issued to
Hot Lead on May 5, 2006.
See 47 U.S.C. S: 503(b)(5) (authorizing the Commission to issue citations
to non-common carriers for violations of the Act or of the Commission's
rules and orders).
Commission staff mailed the citation to 16901 Dallas Parkway, Addison,
Texas 75001 and 1400 Preston Road #300, Plano, Texas 75903. See n.2,
supra.
Following the issuance of the citation, the Commission continued to
receive complaints from multiple consumers alleging that Hot Lead faxed
unsolicited advertisements to them. These complaints, received after the
Commission's citation, resulted initially in the issuance of two Notices
of Apparent Liability for Forfeiture against Hot Lead: on August 14, 2007
in the amount of $2,168,500, The Hot Lead LLC, Notice of Apparent
Liability For Forfeiture, 22 FCC Rcd 15924 (2007), and on December 26,
2007 in the amount of $423,000, The Hot Lead LLC, Notice of Apparent
Liability For Forfeiture, 22 FCC Rcd 22212 (2007). Accordingly, on March
19, 2008, the Commission issued a Forfeiture Order to Hot Lead based on
these NALs in the amount of $2,591,500, The Hot Lead LLC, Forfeiture
Order, 23 FCC Rcd 5282 (2008) Subsequent additional complaints resulted in
the issuance of three additional Notices of Apparent Liability for
Forfeiture against Hot Lead: in the amount of $695,000, The Hot Lead LLC,
Notice of Apparent Liability For Forfeiture, 23 FCC Rcd 8982 (2008); in
the amount of $739,500, The Hot Lead LLC, Notice of Apparent Liability For
Forfeiture, 23 FCC Rcd 11674 (2008); and in the amount of $47,000, The Hot
Lead LLC, Notice of Apparent Liability For Forfeiture, FCC 08-261,
released Nov. 5, 2008. To date, Hot Lead has not filed a response to any
of these NALs or to the Forfeiture Order.
See Appendix for a listing of the consumer complaints against Hot Lead
requesting Commission action.
We note that evidence of additional instances of unlawful conduct by Hot
Lead may form the basis of subsequent enforcement action.
Section 503(b)(2)(C) provides for forfeitures up to $10,000 for each
violation in cases not covered by subparagraph (A) or (B), which address
forfeitures for violations by licensees and common carriers, among others.
See 47 U.S.C. S: 503(b). In accordance with the inflation adjustment
requirements contained in the Debt Collection Improvement Act of 1996,
Pub. L. 104-134, Sec. 31001, 110 Stat. 1321, the Commission implemented an
increase of the maximum statutory forfeiture under section 503(b)(2)(C)
first to $11,000 and more recently to $16,000. See 47 C.F.R. S:1.80(b)(3);
Amendment of Section 1.80 of the Commission's Rules and Adjustment of
Forfeiture Maxima to Reflect Inflation, 15 FCC Rcd 18221 (2000)
(forfeiture maximum for this type of violator set at $11,000); Amendment
of Section 1.80(b) of the Commission's Rules and Adjustment of Forfeiture
Maxima to Reflect Inflation, 19 FCC Rcd 10945 (2004) (amendment of section
1.80(b) to reflect inflation left the forfeiture maximum for this type of
violator at $11,000); Amendment of Section 1.80(b) of the Commission's
Rules, Adjustment of Forfeiture Maxima to Reflect Inflation, 23 FCC Rcd
9845 (2008) (amendment of section 1.80(b) to reflect inflation increased
the forfeiture maximum for this type of violator to $16,000).
47 U.S.C. S: 503(b)(2)(D); 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, 17100-01 para. 27 (1997)
(Forfeiture Policy Statement), recon. denied, 15 FCC Rcd 303 (1999).
See, e.g., complaint dated December 12, 2007, from Joe Agusa (stating that
he has never done any business with the fax advertiser, never made an
inquiry or application to the fax advertiser, never gave permission for
the company to send the fax, and requested the company not to fax an
advertisement). The complainants involved in this action are listed in the
Appendix.
See 47 U.S.C. S: 227(a)(4); 47 C.F.R. S: 64.1200(f)(13) (definition
previously at S: 64.1200(f)(10)).
See Get-Aways, Inc., Notice of Apparent Liability For Forfeiture, 15 FCC
Rcd 1805 (1999); Get-Aways, Inc., Forfeiture Order, 15 FCC Rcd 4843
(2000); see also US Notary, Inc., Notice of Apparent Liability for
Forfeiture, 15 Rcd 16999 (2000); US Notary, Inc., Forfeiture Order, 16 FCC
Rcd 18398 (2001); Tri-Star Marketing, Inc., Notice of Apparent Liability
For Forfeiture, 15 FCC Rcd 11295 (2000); Tri-Star Marketing, Inc.,
Forfeiture Order, 15 FCC Rcd 23198 (2000).
See Carolina Liquidators, Inc., Notice of Apparent Liability for
Forfeiture, 15 FCC 16837, 16842 (2000); 21st Century Fax(es) Ltd., AKA
20th Century Fax(es), 15 FCC Rcd 24406, 24411 (2000).
See 47 U.S.C. S: 503(b)(4)(C); 47 C.F.R. S: 1.80(f)(3).
47 C.F.R. S: 1.80.
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Federal Communications Commission FCC 08-268
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Federal Communications Commission FCC 08-268