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Before the
Federal Communications Commission
Washington, D.C. 20554
)
) File No. EB-08-SE-1074
In the Matter of
) NAL/Acct. No. 200932100012
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"),
we find that Harron Communications, L.P. ("Harron") apparently
willfully violated a Commission Order and Section 76.939 of the
Commission's Rules ("Rules") in failing to respond fully to an
Enforcement Bureau Letter of Inquiry. 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
twenty-five thousand dollars ($25,000). We also order Harron to
respond fully to the LOI within ten (10) days of release of this NAL.
If Harron again fails to submit a complete response, it will be
subject to further enforcement action.
II. background
2. In response to consumer complaints against Harron, on October 30,
2008, the Enforcement Bureau ("Bureau") issued a Letter of Inquiry
("LOI") regarding the company's migration of analog programming to
digital tiers. The LOI sought information concerning instances in
which Harron had migrated analog channels to a digital tier, including
the channels affected, whether and how the company notified customers
of the change, whether, in light of the change in service, the company
permitted customers to change their service tier without charge, and
the rates charged customers before and after the channel migration.
The LOI also asked about Harron's charges for digital set-top boxes as
well as information regarding Harron's subscriber rates and the rates
it pays to video programmers.
3. In its response to the LOI, Harron failed to respond to Question 8.b,
citing the confidential nature of the information requested as its
reason. Harron states that it is working with its affected programming
distributors regarding possible disclosure.
III. discussion
A. Failure to Respond Fully to the LOI
4. We find that Harron's failure to fully respond to the Bureau's inquiry
constitutes an apparent willful violation of a Commission Order and
Section 76.939 of the Rules. The Bureau directed Harron to provide
certain information related to the movement of analog channels to
digital tiers. This information was necessary to enable the Commission
to perform its enforcement function and evaluate whether Harron
violated Commission Rules. Harron received the LOI but failed to
provide a full and complete response.
5. The Commission has broad investigatory authority under Sections 4(i),
4(j), and 403 of the Act, its Rules, and relevant precedent. Section
4(i) authorizes the Commission to "issue such orders, not inconsistent
with this Act, as may be necessary in the execution of its functions."
Section 4(j) states that "the Commission may conduct its proceedings
in such manner as will best conduce to the proper dispatch of business
and to the ends of justice." Section 403 grants the Commission "full
authority and power to institute an inquiry, on its own motion ...
relating to the enforcement of any of the provisions of this Act."
Pursuant to Section 76.939 of the Rules, a cable operator must comply
with FCC requests for information, orders, and decisions. In carrying
out this obligation, a cable operator also must provide truthful and
accurate statements to the Commission or its staff in any
investigatory or adjudicatory matter within the Commission's
jurisdiction. Lastly, numerous FCC decisions have reaffirmed the
Commission's authority to investigate potential misconduct and punish
those that disregard FCC inquiries. The Commission delegated this
authority to the Enforcement Bureau in Section 0.111(a)(16) of the
Rules.
6. Harron alleges that it could not have responded fully to the LOI
because the amount of time allowed for the preparation of the
company's LOI response was too brief for it to arrange for the
necessary disclosure of confidential material responsive to Question
8b. Certain complaints received by the Commission regarding the
migration of analog programming to a digital tier, however, allege
that cable operators were falsely linking the programming changes with
the digital television transition. Because of the strong public
interest in avoiding confusion about the transition and the rapidly
approaching transition date, the Bureau determined that two weeks was
an appropriate deadline and we conclude that two weeks was a
reasonable deadline. Thus, Harron was obligated to provide the
requested information by our deadline. Moreover, we note that since it
submitted its LOI response and while this matter remains under
investigation by the Bureau, Harron has neither contacted the Bureau
about its response nor provided any supplemental information.
7. Further, we reject Harron's contention that the confidential nature of
some of the information responsive to the Bureau's LOI absolved Harron
of its obligation to respond in a timely fashion. In addition to
requesting confidential treatment of such material pursuant to the
Commission's well-established, long-standing rules regarding the
treatment of material routinely considered confidential, the
Commission issued a Protective Order in this investigation
specifically to address any concerns regarding the potentially
confidential nature of certain information. Thus, Harron had the
option, as set forth by the Commission's General Counsel in his letter
directed to Harron, of providing the information under that Protective
Order. We find therefore that Harron's failure to fully respond to the
Bureau's inquiry constitutes an apparent willful violation of a
Commission order and Section 76.939 of the Rules.
A. Proposed Forfeiture
8. We conclude under applicable standards set forth in the Act, that
Harron is apparently liable for forfeiture for its apparent willful
violation of a Commission Order and Section 76.939 of the Rules. 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.
9. Under Section 503(b)(2)(A) of the Act, we may assess a cable operator
a forfeiture of up to $37,500 for each violation, or for each day of a
continuing violation up to a maximum of $375,000 for a single act or
failure to act. 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."
10. Section 1.80 of the Rules and the Commission's Forfeiture Policy
Statement establish a base forfeiture amount of four thousand dollars
($4,000) for failure to respond to Commission communications. We find
that Harron's failure to respond fully to the LOI in the circumstances
presented here warrants a significant increase to this base amount.
Misconduct of this type exhibits contempt for the Commission's
authority and threatens to compromise the Commission's ability to
adequately investigate violations of its rules. Prompt and full
responses to Bureau inquiry letters are essential to the Commission's
enforcement function. In this case, Harron's apparent violations have
delayed our investigation and inhibited our ability to examine
allegations raised in consumer complaints and also potentially
touching on an area of critical importance -- the DTV transition. We
further note that Harron failed to provide a full and complete LOI
response even after receiving a specific warning from the Commission's
General Counsel that such actions could be subject to enforcement
penalties.
11. Based on these facts, we therefore propose a twenty-five thousand
dollar ($25,000) forfeiture against Harron for failing to respond
fully to Commission communications. This forfeiture amount is
consistent with precedent in similar cases, where companies failed to
provide responses to Bureau inquiries concerning compliance with the
Commission's Rules despite evidence that the LOIs had been received.
12. We also direct Harron to respond fully to the October 30, 2008 LOI
within ten (10) days of the release of this Notice of Apparent
Liability for Forfeiture and Order. Failure to do so may constitute an
additional violation subjecting Harron to further penalties, including
potentially higher monetary forfeitures.
IV. ordering clauses
13. Accordingly, IT IS ORDERED that, pursuant to Section 503(b) of the
Act, and Section 1.80 of the Rules, and the authority delegated by
Sections 0.111 and 0.311 of the Commissions Rules, Harron
Communications, L.P. is NOTIFIED of its APPARENT LIABILITY FOR A
FORFEITURE in the amount of twenty-five thousand dollars ($25,000) for
its willful violation of a Commission Order and Section 76.939 of the
Rules.
14. IT IS FURTHER ORDERED that, pursuant to Section 1.80 of the Rules,
within 30 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), 403 of
the Communications Act of 1934, as amended, 47 U.S.C. S:151, 154(i),
154(j), 403, Harron shall fully respond to the October 30, 2008 Letter
of Inquiry sent by the Enforcement Bureau in the manner described by
that Letter of Inquiry within ten (10) days of the release of this
Notice of Apparent Liability 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 JoAnn.Lucanik@fcc.gov
and Thomas.Fitz-Gibbon@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. The
response should also be e-mailed to JoAnn Lucanik, Deputy Chief,
Spectrum Enforcement Division, Enforcement Bureau, FCC, at
JoAnn.Lucanik@fcc.gov and Thomas D. Fitz-Gibbon, Esq., Spectrum
Enforcement Division, FCC, at Thomas.Fitz-Gibbon@fcc.gov.
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 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
The inquiry in this investigation was directed to Harron Entertainment
Company ("HEC"). However, the LOI Response notes that cable systems in
this investigation operate under the names "MetroCast Communications" and
"MetroCast Cablevision" and are subsidiaries of Harron Communications,
L.P. ("Harron") and not HEC. We have modified the caption accordingly.
47 C.F.R. S: 76.939.
47 U.S.C. S: 503(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").
Letter from Ryan F. Pearson, Executive Vice President and General Counsel,
Harron Communications, L.P. to Marlene H. Dortch, Secretary, Federal
Communications Commission (Nov. 13, 2008) ("LOI Response").
Id.
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 indicates 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, e.g., Southern California
Broadcasting Co., Memorandum Opinion and Order, 6 FCC Rcd 4387, 4387-88 P:
5 (1991) ("Southern California Broadcasting").
47 U.S.C. S: 154(i).
47 U.S.C. S: 154(j).
47 U.S.C. S: 403.
47 C.F.R. S: 76.939 ("Cable operators shall comply with ... the
Commission's requests for information, orders, and decisions.").
See 47 C.F.R. S: 1.17.
See, e.g., SBC Communications, Inc., Forfeiture Order, 17 FCC Rcd 7589,
7599-7600 P:P: 23-28 (2002) (ordering $100,000 forfeiture for egregious
and intentional failure to certify the response to a Bureau inquiry) ("SBC
Forfeiture Order"); Digital Antenna, Inc., Notice of Apparent Liability
for Forfeiture and Order, 23 FCC Rcd 7600, 7602 (Spectr. Enf. Div., Enf.
Bur. 2008) (proposing $11,000 forfeiture for failure to provide a complete
response to an LOI); BigZoo.Com Corporation, Forfeiture Order, 20 FCC Rcd
3954 (Enf. Bur. 2005) (ordering $20,000 forfeiture for failure to respond
to an LOI).
47 C.F.R. S:0.111(a)(16) (granting the Enforcement Bureau authority to
"[i]dentify and analyze complaint information, conduct investigations,
conduct external audits and collect information, including pursuant to
sections 218, 220, 308(b), 403 and 409(e) through (k) of the
Communications Act, in connection with complaints, on its own initiative
or upon request of another Bureau or Office."). See also 47 C.F.R.
S:S:0.111(a)(13) (Enforcement Bureau has authority to "[r]esolve
complaints regarding multichannel video and cable television service under
part 76 of the Commission's rules"); 0.311 (general delegated authority
for Enforcement Bureau).
LOI Response at 8.
See LOI Attachment, Request for Confidential Treatment, referencing the
Commission's Rules at 47 C.F.R. S: 0.459.
Prior to the due date for Harron's LOI Response, the Commission's General
Counsel advised the company that the LOI complied with the Paperwork
Reduction Act, warned of enforcement action if the company failed to
comply with the LOI, and offered Harron the opportunity to submit any
highly confidential information pursuant to a protective order. See Letter
from Matthew Berry, General Counsel, Federal Communications Commission, to
Ryan F. Pearson, Executive Vice President and General Counsel (Nov. 12,
2008) ("Berry Letter").
See Harron Entertainment Company, Protective Order, DA 08-2494 (Enf. Bur.
rel. Nov. 13, 2008).
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 indicates 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, e.g., Southern California
Broadcasting Co., Memorandum Opinion and Order, 6 FCC Rcd 4387, 4387-88 P:
5 (1991) ("Southern California Broadcasting").
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 Forfeiture Order, 17 FCC Rcd at 7591.
47 U.S.C. S: 503(b)(2)(A). The Commission has amended Section 1.80(b)(3)
of the Rules, 47 C.F.R. S: 1.80(b)(3), three times to increase the maximum
forfeiture amounts, in accordance with the inflation adjustment
requirements contained in the Debt Collection Improvement Act of 1996, 28
U.S.C. S: 2461. See Amendment of Section 1.80 of the Commission's Rules
and Adjustment of Forfeiture Maxima to Reflect Inflation, 23 FCC Rcd 9845
(2008) (adjusting the maximum statutory amounts for broadcasters and cable
operators from $32,500/$325,000 to $37,500/$375,000); Amendment of Section
1.80 of the Commission's Rules and Adjustment of Forfeiture Maxima to
Reflect Inflation, Order, 19 FCC Rcd 10945 (2004) (adjusting the maximum
statutory amounts for broadcasters and cable operators from
$27,500/$300,000 to $32,500/$325,000); Amendment of Section 1.80 of the
Commission's Rules and Adjustment of Forfeiture Maxima to Reflect
Inflation, Order, 15 FCC Rcd 18221 (2000) (adjusting the maximum statutory
amounts for broadcasters and cable operators from $25,000/$250,000 to
$27,500/$300,000). The most recent inflation adjustment took effect
September 2, 2008 and applies to violations that occur after that date.
See 73 Fed. Reg. 44663-5. Harron's apparent violations occurred after
September 2, 2008 and are therefore subject to the higher forfeiture
limits.
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 47 C.F.R. S: 1.80(b)(4); 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).
Berry Letter at 2.
See supra note 12.
We do not decide in this NAL whether the failure to respond to an LOI
constitutes a continuing violation.
(Continued from previous page)
(continued ...)
Federal Communications Commission DA 09-82
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Federal Communications Commission DA 09-82