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Before the
Federal Communications Commission
Washington, D.C. 20554
)
) File No. EB-08-SE-559
In the Matter of
) NAL/Acct. No. 200832100078
Hannspree North America, Inc.
) FRN: 0018065409
)
FORFEITURE ORDER
Adopted: March 24, 2009 Released: March 26, 2009
By the Chief, Enforcement Bureau:
I. introduction
1. In this Forfeiture Order ("Order"), we issue a monetary forfeiture in
the amount of twelve thousand four hundred and fifty dollars ($12,450)
against Hannspree North America, Inc. ("Hannspree") for the willful
and repeated violation of Section 15.117(i)(1)(iii) of the
Commission's Rules ("Rules"). The noted violations involve Hannspree's
interstate shipment of television broadcast receivers that do not
comply with the Commission's Rules regarding digital television
("DTV") reception capability.
2. On August 28, 2008, the Enforcement Bureau ("Bureau") issued a Notice
of Apparent Liability for Forfeiture ("NAL") to Hannspree in the
amount of twelve thousand four hundred and fifty dollars ($12,450).
Hanspree filed a response to the NAL on September 3, 2008.
II. BACKGROUND
3. The Commission adopted the DTV reception capability requirement in
2002. This requirement, which 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 over-the-air television reception of
digital signals just as they have provided over-the-air television
reception of analog signals.
4. Section 15.117(i)(1) of the Rules provides, "[r]esponsible parties, as
defined in S: 2.909 of this chapter, are required to equip new TV
broadcast receivers that are shipped in interstate commerce or
imported from any foreign country into the United States and for which
they are responsible to comply with the provisions of this section" in
accordance with the specified phase-in schedule. As modified by the
Commission in 2005, this phase-in schedule is 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.
5. The Commission's 2005 DTV Tuner Second Report and Order amended the
Rules to apply the DTV tuner requirement to new receivers with screen
sizes smaller than 13" on this same schedule (i.e., March 1, 2007).
Although the Commission adopted this requirement for receivers with
screen sizes smaller than 13" through the appropriate notice and
comment procedures, and modified the Rules to show March 1, 2007, as
the accelerated deadline, the Commission inadvertently failed to
delete the exception in Section 15.117(i)(2) for "units with
integrated tuners/displays that have screen sizes measuring less than
7.8 inches vertically, i.e., the vertical measurement of a screen in
the 4:3 aspect ratio that measures 13' [sic] diagonally across the
picture viewing area." The Commission subsequently corrected Section
15.117(i)(2) by striking the inappropriate language, and the DTV tuner
requirements for receivers with screen sizes less than 13" became
effective on January 30, 2008.
6. On July 8, 2008, the Bureau issued a Letter of Inquiry ("LOI") to
Hannspree regarding the company's importation and interstate shipment
of non-DTV-compliant television receivers. Hannspree filed its
response to the LOI on August 6, 2008, and stated that since March 1,
2007, it had shipped interstate more than three dozen models of
television receivers that were not equipped with DTV tuners, with
screen sizes of 10, 12, 15, or 23 inches, measured diagonally.
Hannspree stated that it shipped interstate a total of 3,735 such
receivers after March 1, 2007.
7. On August 28, 2008, the Bureau released an NAL finding that Hannspree
had violated Section 15.117(i)(1)(iii) of the Rules by shipping in
interstate commerce television receivers that were not equipped with
DTV tuners. Specifically, the NAL found that Hannspree had shipped
1,129 television receivers with screen sizes less than 25" after March
1, 2007, that failed to comply with the DTV tuner requirement. The NAL
noted that in its LOI Response, Hannspree admitted to shipping
interstate 3,375 non-DTV-compliant television broadcast receivers, but
because the DTV tuner requirement became effective for television
receivers with screen sizes measuring less than 13" only on January
30, 2008, we did not consider 2,246 receivers with screen sizes less
than 13" that Hannspree shipped prior to the effective date in
formulating our proposed forfeiture. The NAL additionally noted that
of those 1,129 television receivers, 880 had been shipped more than
one year prior to the date of the NAL, and that Section 503(b)(6)(B)
of the Act prohibits the Commission from imposing a forfeiture penalty
against a person that does not hold a broadcasting license "if the
violation occurred more than 1 year prior to the date of issuance of
the required notice or notice of apparent liability." Thus, the NAL
proposed a forfeiture only for the 249 non-DTV compliant receivers
that were shipped interstate by Hannspree within the one year period
prior to the issuance of the NAL. Using a tiered per unit approach,
Hannspree was found liable for a proposed forfeiture in the amount of
$12,450.
8. In its response to the NAL, Hannspree requests that if we find that
any of the 249 non-DTV compliant receivers were imported prior to
March 1, 2007, and sold by Hannspree in their two California-based
retail stores from their inventory, then we should reduce the amount
of the proposed forfeiture accordingly.
III. Discussion
9. The forfeiture amount proposed in this case was assessed in accordance
with Section 503(b) of the Act, Section 1.80 of the Rules, and 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.
10. We have considered Hannspree's response to the NAL in light of the
above statutory factors, our Rules, and the Forfeiture Policy
Statement. We conclude that Hannspree willfully and repeatedly
violated Section 15.117(i)(1)(iii) of the Rules and that no mitigating
circumstances warrant cancellation or further reduction of the
proposed forfeiture amount. Specifically, Hannspree admitted in its
response to the LOI that of the 1,129 non-DTV-compliant television
receivers imported between March 1, 2007 and August 6, 2008, the date
of its LOI response, 249 non-DTV-compliant receivers were shipped
interstate within the one-year period prior to the issuance of the
NAL. We note further that in its response to the NAL, Hannspree does
not dispute that it violated Section 15.117(i)(1)(iii) of the Rules by
shipping a total of 249 non-DTV-compliant television receivers in
interstate commerce after the effective deadline of March 1, 2007 for
receivers with screens 13" or larger, and after January 30, 2008 for
receivers with screens that are smaller than 13".
11. Hannspree in its response to the NAL seeks a reduction of the proposed
forfeiture to the extent that it should be considered a retailer in
addition to an importer, and to the extent that we find that any of
its non-DTV-compliant television receiver sales were made from
inventory that was imported into the United States prior to the March
1, 2007 deadline. While Hannspree is correct in its assertion that the
Rules do not bar responsible parties from retail sales of
non-DTV-compliant receivers after the March 1, 2007 deadline, as long
as those sales are conducted in compliance with the labeling
requirements of Section 15.117(k), that Section provides no exemption
from the separate and distinct prohibition on the importation or
interstate shipment of non-DTV-compliant television receivers set
forth in Section 15.117(i), which is the subject rule violation before
us in this proceeding.
12. Therefore, Hannspree has not demonstrated that a reduction or
cancellation of the proposed forfeiture is warranted. Accordingly, we
find that Hannspree has willfully and repeatedly violated Section
15.117(i)(1)(iii) of the Rules, and that a forfeiture in the amount of
$12,450 is appropriate, and that Hannspree is not entitled to a
reduction in the amount proposed by the NAL.
IV. ORDERING CLAUSES
13. Accordingly, IT IS ORDERED that, pursuant to Section 503(b) of the
Act, and Sections 0.111, 0.311 and 1.80(f)(4) of the Rules, Hannspree
North America, Inc. IS LIABLE FOR A MONETARY FORFEITURE in the amount
of twelve thousand four hundred and fifty dollars ($12,450) for
willful and repeated violation of Section 15.117(i)(1)(iii) of the
Rules.
14. 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. Hannspree North America, Inc. will also
send electronic notification on the date said payment is made to
Deborah Broderson at Deborah.Broderson@fcc.gov and to Ricardo Durham
at Ricardo.Durham@fcc.gov.
15. IT IS FURTHER ORDERED that a copy of this Order shall be sent by First
Class and Certified Mail Return Receipt Requested to Mr. Eric Hsu,
Hannspree North America, Inc., 14450 Myford Road, Suite 100, Irvine,
California 92606.
FEDERAL COMMUNICATIONS COMMISSION
Kris Anne Monteith
Chief, Enforcement Bureau
47 C.F.R. S: 15.117(i)(1)(iii).
See 47 C.F.R. S: 15.3(w) (defining a television broadcast receiver as "a
device designed to receive television pictures that are broadcast
simultaneously with sound on the television channels authorized under part
73 of this chapter.")
Hannspree North America, Inc., Notice of Apparent Liability for
Forfeiture, 23 FCC Rcd 12902 (Enf. Bur. 2008) ("NAL").
Letter from Eric Hsu, Vice President Operations, Hannspree North America,
Inc. to Kathryn Berthot, Chief, Spectrum Enforcement Division, Enforcement
Bureau, Federal Communications Commission (September 3, 2008) ("NAL
Response").
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 (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
n.2 (2005) ("DTV Tuner Report and Order").
DTV Review Second Report and Order, 17 FCC Rcd at 15996. 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 with an antenna or antenna terminals that can be used for
over-the-air television reception. See 47 C.F.R. S: 15.117(i)(1)(iv).
DTV Review Second Report and Order, 17 FCC Rcd 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 ...". Id. at 15589-91.
47 C.F.R. S: 15.117(i)(1).
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.
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, 18614-16 (2005) ("DTV Tuner Second Report and Order").
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(b),
the party responsible for equipment such as television receivers that are
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.
See Third Periodic Review of the Commission's Rules and Policies Affecting
the Conversion to Digital Television, Report and Order, 23 FCC Rcd 2994,
3081 (2007).
See Third Periodic Review of the Commission's Rules and Policies Affecting
the Conversion to Digital Television, Final Rule, 73 Fed. Reg. 5634 (Jan.
30, 2008).
See Letter from Kathryn S. Berthot, Chief, Spectrum Enforcement Division,
Enforcement Bureau, Federal Communications Commission, to Hannspree North
America, Inc. (July 8, 2008) ("LOI").
See Letter from Eric Hsu, Vice-President of Operations, Hannspree North
America, Inc., to Kathryn S. Berthot, Chief, Spectrum Enforcement
Division, Enforcement Bureau, Federal Communications Commission (August 6,
2008) ("LOI Response").
Id. at 1. Specifically, Hannspree shipped interstate the following models
of television receivers that are not equipped with DTV tuners:
DT07-10U1-000; DT12-10U1-000; F001-15U1-000; F609-15U1-0011;
F617-15U1-000; F629-10U1-000; F633-10U1-000; F637-10U1-000; F651-12U1-000;
K206-10U1-005; K206-10U1-010; K209-10U1-000; K212-10U1-000B;
K223-10U1-000; K226-10U1-000; LT09-10U1-000; LT09-10U1-0001;
LT13-23U1-001; ST02-15U1-019; ST02-15U1-030; ST03-15U1-000; ST06-15U1-000;
ST08-10U1-000; ST09-10U1-011; ST23-10U1-000; ST35-15U1-003; ST35-15U1-015;
ST35-15U1-022; ST35-15U1-0071; ST35-15U1-0111; ST35-15U1-0211;
ST35-15U1-0251; ST35-15U1-0261; ST35-15U1-0281; ST35-15U1-0301;
ST43-15U1-000; ST54-10U1-000; ST59-23U1-001.
Id. at 3.
See id. at Exhibit A. In response to a request to provide a list of
non-DTV-compliant receivers shipped in interstate commerce during this
period, Hannspree provided data showing its shipment of 5,518 units. Of
this number, 1,759 units were actually equipped with DTV tuners and an
additional 24 units were in fact exported rather than shipped interstate;
thus, Hannspree shipped in interstate commerce a total of 3,735 receivers
that did not contain DTV tuners. Id.
See NAL, 23 FCC Rcd at 12905.
47 U.S.C. S: 503(b)(6)(B).
See NAL, 23 FCC Rcd at 12907.
In its NAL Response, in addition to asking for a reduction in the proposed
forfeiture, Hannspree also requested Bureau guidance on the following
three topics: 1) if the Rules bar intrastate sales of analog receivers
after March 1, 2007; 2) if the Rules allow overseas sales of analog
receivers; and 3) if sales of analog receivers after March 1, 2007 are
permitted if the unit is sold with a converter box. These inquiries do not
relate to the issues before the Bureau pursuant to the NAL, and appear to
seek a declaratory ruling on the provisions of Section 15.117. To address
those issues in this proceeding would therefore be inappropriate. We note,
however, that the second issue was implicitly answered in the NAL, which
excluded the 24 receivers that Hannspree reported exporting, rather than
shipping in interstate commerce, from its calculation of the total number
of non-DTV-compliant receivers that were the basis for the forfeiture. See
id. at 12904 n.17.
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).
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 Sections 312 and 503(b) of the Act, H.R. REP. No. 97-765, 51
(Conf. Rep.), and the Commission has so interpreted the terms in the
Section 503(b) context. See Southern California Broadcasting Co.,
Memorandum Opinion and Order, 6 FCC Rcd 4387, 4387-88 (1991), recon.
denied, 7 FCC Rcd 3454 (1992) ("Southern California").
Section 312(f)(1) of the Act defines "repeated" as "the commission or
omission of [any] act more than once or, if such commission or omission is
continuous, for more than one day." 47 U.S.C. S: 312(f)(1). See also
Southern California, 6 FCC Rcd at 4388 (applying this definition of
repeated to Sections 312 and 503(b) of the Act).
See NAL Response at 1.
47 C.F.R. S: 15.117(k).
47 C.F.R. S:S: 0.111, 0.311, 1.80(f)(4).
Federal Communications Commission DA 09-669
1
Federal Communications Commission DA 07-