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Before the
Federal Communications Commission
Washington, D.C. 20554
)
)
File Number EB-09-SE-008
In the Matter of )
NAL/Acct. No. 200932100030
Harron Communications, LP )
FRN 0016642761
)
)
NOTICE OF APPARENT LIABILITY FOR FORFEITURE AND ORDER
Adopted: January 19, 2009 Released: January 19, 2009
By the Chief, Enforcement Bureau:
I. INTRODUCTION
1. In this Notice of Apparent Liability for Forfeiture and Order ("NAL
and Order"), we find that Harron Communications, L.P.'s cable system
serving Amory, Mississippi ("Harron") apparently willfully violated
Section 76.1603(b) of the Commission's Rules ("Rules"). Specifically,
Harron failed to provide the requisite thirty (30) days advance
written notice to its customers, before implementing a change in
rates, programming services or channel positions as required under the
Rules. We conclude, pursuant to Section 503(b) of the Communications
Act of 1934, as amended ("Act"), that Harron is apparently liable for
a forfeiture in the amount of seven thousand five hundred dollars
($7,500). We also order Harron, within ninety (90) days of this NAL
and Order, to issue refunds to the customers affected by the change in
rates, programming services or channel position as explained more
fully below.
II. BACKGROUND
2. On July 19,2008, the Commission received a complaint from a customer
in Amory, Mississippi asserting that Metro Cast Communications had
transferred services from complainant's cable service. According to
the complainant, this change was made without any notice.
III. DISCUSSION
A. Harron Apparently Violated Section 76.1603(b) By Failing To Provide
Proper Notice to its Customers.
3. Based on the record before us, we find that Harron apparently
willfully violated Section 76.1603(b) by failing to notify its
customers before implementing a change in rates, programming services
or channel positions as required under the Rules.
4. Section 76.1603(b) of the Rules provides, in relevant part, as
follows:
Customers will be notified of any changes in rates, programming services
or channel positions as soon as possible in writing. Notice must be given
to subscribers a minimum of thirty (30) days in advance of such changes if
the change is within the control of the cable operator. In addition, the
cable operator shall notify subscribers 30 days in advance of any
significant changes in the other information required by S: 76.1602.
5. We find that the migration of each channel constitutes a change in
rates, programming services or channel positions under the Rules. We
also find that the migration was a change within the control of Harron
because we are unaware of external forces that would have required
Harron to make such a change, particularly without giving 30 days
notice. In our Letter of Inquiry issued to Harron on October 30, 2008,
we asked for a range of information related to the migration of
channels, including evidence that consumers were provided with the
notice required under our rules. Unfortunately, Harron failed to
produce any evidence on this point in response to our request,
including any evidence that the requisite notice was provided of the
migration that is the subject of this NAL and Order.
6. Therefore, for the reasons stated above, we find that Harron
apparently violated Section 76.1603(b) by failing to provide its
customers at least thirty (30) days notice of a change in rates,
programming services or channel positions.
B. Forfeiture Calculation
7. 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. Based on
the analysis set forth below, we conclude that Harron is apparently
liable for a forfeiture in the amount of seven thousand five hundred
dollars ($7,500) for its willful violation of Section 76.1603(b) of
the Rules.
8. Under Section 503(b)(2)(A) and Section 1.80(b)(1) of the Commission's
Rules, we may assess a cable television operator a forfeiture of up to
$32,000 for each violation or each day of a continuing violation, up
to a statutory maximum forfeiture of $325,000 for any single
continuing violation. In exercising such authority, we are required 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."
9. The Commission's Forfeiture Policy Statement and Section 1.80 of the
Rules do not establish a specific base forfeiture for violation of
Section 76.1603's notice requirements. Based on the totality of
circumstances here and the Commission's past precedent, we find that
$7,500 is an appropriate base forfeiture for failure to notify its
customers of Harron's change in service. Accordingly, we conclude that
Harron is apparently liable for a total forfeiture of $7,500 for its
willful violation of Section 76.1603(b) of the Rules.
C. Harron Must Issue Refunds To Customers Harmed By Its Failure To Provide
Notice.
10. Harron's change in rates, programming services or channel positions
without the required notice has harmed its customers who purchased
services based on the reasonable assumption that Harron would not be
moving significant portions of programming from standard service tiers
to digital cable tiers without providing the notice required under our
Rules. In effect, Harron's movement of programming to a digital tier
without any reduction in subscriber fees has substantially diminished
the value of the programming complainant receives. The complainant
must now pay the same monthly rate for cable service even though
complainant can view fewer channels.
11. Thus, we order Harron, within ninety (90) days of this NAL and Order,
to issue refunds to all affected customers who did not receive the
required notice as of the date of the programming change.
Specifically, Harron must provide refunds as follows:
Harron must refund the customer's subscriber fees of all affected
customers who did not receive the required notice based on the diminished
value of their service following the movement of programming without
proper notice by $0.10 per channel moved per month and reduce
complainant's rates on a going-forward basis accordingly until the notice
required under our rules has been provided.
12. In addition, we order Harron to submit to the Bureau within 30 days of
the issuance of refunds a report in the form of a letter advising the
Bureau that such refunds have been paid and that affected subscribers'
fees have been reduced as directed.
IV. ordering clauses
13. Accordingly, IT IS ORDERED, pursuant to section 503(b) of the
Communications Act of 1934, as amended, 47 U.S.C. S: 503(b)(5), and
section 1.80 of the Commission's rules, 47 C.F.R. S: 1.80, and under
the authority delegated by sections 0.111 and 0.311 of the
Commission's rules,47 C.F.R. S: 0.111, 0.311, Harron is NOTIFIED of
its APPARENT LIABILITY FOR A FORFEITURE in the amount of seven
thousand five hundred dollars ($7,500.00) for willful violation of
Section 76.1603(b) of the Rules.
14. IT IS FURTHER ORDERED that, pursuant to Section 1.80 of the Rules,
within thirty days of the release date of this Notice of Apparent
Liability for Forfeiture and Order, Harron SHALL PAY the full amount
of the proposed forfeiture or SHALL FILE a written statement seeking
reduction or cancellation of the proposed forfeiture.
15. IT IS FURTHER ORDERED that, pursuant to sections 1, 4(i), 4(j), 601,
and 629 of the Communications Act of 1934, as amended 47 U.S.C. S:S:
151, 154(i), 154(j), 521, 549, Harron must take the steps set forth in
paragraphs 10, 11, and 12 of this Notice of Apparent Liability for
Forfeiture and Order.
16. Payment of the forfeiture must be made by check or similar instrument,
payable to the order of the Federal Communications Commission. The
payment must include the NAL/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. Harron will also send electronic
notification on the date said payment is made to Kathy.Berthot@fcc.gov
and to JoAnnLucanik@fcc.gov.
17. The response, if any, must be mailed to the Office of the Secretary,
Federal Communications Commission, 445 12th Street, S.W., Washington,
D.C. 20554, ATTN: Enforcement Bureau - Spectrum Enforcement Division,
and must include the NAL/Acct. No. referenced in the caption.
18. The Commission will not consider reducing or canceling a forfeiture in
response to a claim of inability to pay unless the petitioner submits:
(1) federal tax returns for the most recent three-year period; (2)
financial statements prepared according to generally accepted
accounting practices; or (3) some other reliable and objective
documentation that accurately reflects the petitioner's current
financial status. Any claim of inability to pay must specifically
identify the basis for the claim by reference to the financial
documentation submitted.
19. IT IS FURTHER ORDERED that a copy of this Notice of Apparent Liability
for Forfeiture and Order shall be sent by first class mail and
certified mail return receipt requested to that a copy of this Notice
of Apparent Liability for Forfeiture and Order shall be sent by first
class mail and certified mail return receipt requested to Ryan F.
Pearson, Executive Vice President and General Counsel, Harron
Communications, L.P., 70 East Lancaster Avenue, Frazer, PA 19355 and
to its counsel, J. Christopher Redding, Esq., Dow Lohnes PLLC, 1200
New Hampshire Avenue, NW, Suite 800 Washington, DC 20036-6802.
FEDERAL COMMUNICATIONS COMMISSION
Kris Anne Monteith
Chief, Enforcement Bureau
47 C.F.R. S: 76.1603(b).
47 U.S.C. S: 503(b).
MetroCast Communications" and "MetroCast Cablevision" cable systems and
subsidiaries of Harron Communications, L.P.
See 08-C00036840-1.
47 C.F.R. S: 76.1603(b).
Letter from Kathryn S. Berthot, Chief, Spectrum Enforcement Division,
Enforcement Bureau, Federal Communications Commission to Ryan F. Pearson,
Executive Vice President and General Counsel, Harron Entertainment Company
(Oct. 30, 2008) ("LOI").
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).
47 U.S.C. S: 503(b)(2)(A), 47 C.F.R. S: 1.80(b)(1). The Commission has
repeatedly amended Section 1.80(b)(1) of the Rules to increase the maximum
forfeiture amounts, in accordance with the inflation adjustment
requirements contained in the Debt Collection Improvement Act of 1996, 28
U.S.C. S: 2461. Most recently, the Commission raised the maximum
forfeitures applicable to cable operators, broadcast licensees, and
applicants for such authority from $32,500 to $37,500 for a single
violation, and from $325,000 to $375,000 for a continuing violation. See
Inflation Adjustment of Maximum Forfeiture Penalties, 73 Fed. Reg. 44663,
44664 (July 31, 2008). The new forfeiture limits will take effect
September 2, 2008 and do not apply to this case.
47 U.S.C. S: 503(b)(2)(E). See also 47 C.F.R. S: 1.80(b)(4), Note to
paragraph (b)(4): Section II. Adjustment Criteria for Section 503
Forfeitures.
See The Commission's Forfeiture Policy Statement and Amendment of Section
1.80 of the Rules to Incorporate the Forfeiture Guidelines, Report and
Order, 12 FCC Rcd 17087, 17115 (1997), recon. denied, 15 FCC Rcd 303
(1999) ("Forfeiture Policy Statement").
The Commission has substantial discretion, however, in proposing
forfeitures. See, e.g., InPhonic, Inc., Order of Forfeiture and Further
Notice of Apparent Liability, 22 FCC Rcd 8689, 8699 (2007); Globcom, Inc.
d/b/a Globcom Global Commun., Order of Forfeiture, 21 FCC Rcd 4710,
4723-24 (2006). We may apply the base forfeiture amounts described in the
Forfeiture Policy Statement and the Commission's rules, or we may depart
from them altogether as the circumstances demand See 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 also Northland Cable Television, Inc., Memorandum Opinion and Order
and Notice of Apparent Liability for Forfeiture, 23 FCC Rcd 7865 (Media
Bur. 2008) (proposing $20,000 forfeiture for apparent violations of
Section 76.1603 and other rules); Northland Cable Television, Inc.,
Memorandum Opinion and Order and Notice of Apparent Liability for
Forfeiture, 23 FCC Rcd 7872 (Media Bur. 2008) (same).
Thus, for example, if Harron migrated a channel and did not provide proper
notice for nine months, it must refund $0.90 to each affected customer.
$0.10 is our best estimate of the relevant license fee per channel. We
note that Harron did not provide actual per channel license fees as
required by the LOI. The Bureau will reconsider the appropriate license
fee per channel should Harron submit a petition for reconsideration that
includes evidence that the license fees of the affected channels are lower
than $0.10 per month.
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(continued....)
Federal Communications Commission DA 09-129
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Federal Communications Commission DA 09-129