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Before the
Federal Communications Commission
Washington, D.C. 20554
)
)
In the Matter of ) File No.: EB-09-SJ-0013
Ayustar Corporation ) NAL/Acct. No.: 201032680001
San Juan, PR ) FRN: 0008739229
)
)
MEMORANDUM OPINION AND ORDER
Adopted: November 23, 2010 Released: November 23, 2010
By the Chief, Enforcement Bureau:
I. INTRODUCTION
1. In this Memorandum Opinion and Order, we deny the petition for
reconsideration filed by Ayustar Corporation ("Ayustar") in response
to the Forfeiture Order issued by the Enforcement Bureau's South
Central Region ("EB South Central Region") on January 8, 2010. The
Forfeiture Order imposed a monetary forfeiture in the amount of ten
thousand dollars ($10,000) for Ayustar's willful and repeated
violation of Section 301 of the Communications Act of 1934, as amended
("Act"), involving Ayustar's operation of unlicensed radio
transmitters.
II. BACKGROUND
2. On November 12, 2009, the Enforcement Bureau's San Juan Office issued
a Notice of Apparent Liability for Forfeiture to Ayustar in the amount
of $10,000, for the apparent willful and repeated violation of Section
301 of the Act. On December 3, 2009, Ayustar submitted a response to
the NAL requesting reduction or cancellation of the proposed
forfeiture based "solely on the lack of capacity of Ayustar to pay the
established fine." In the Forfeiture Order, the EB South Central
Region found that Ayustar's documented gross revenues did not warrant
a reduction based on inability to pay and imposed a forfeiture in the
amount of $10,000. On February 2, 2010, Ayustar filed a petition for
reconsideration requesting reduction or cancellation of the forfeiture
based on its net losses rather than its gross revenues.
III. DISCUSSION
3. The forfeiture amount in this case was assessed in accordance with
Section 503(b) of the Act, Section 1.80 of the Commission's Rules
("Rules"), and the Commission's Forfeiture Policy Statement. In
examining Ayustar's petition, Section 503(b) of the Act requires that
the Commission 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 other such matters as justice may require. As discussed below, we
decline to reduce the forfeiture on the basis of Ayustar's claim of an
inability to pay.
4. In its petition, Ayustar requests that the Commission "take into
consideration other financial indicators, such as net losses," to
determine its ability to pay the forfeiture. Citing First Greenville
Corporation, Benito Rish, and Pinnacle Communications, Ayustar notes
that "the Commission took into consideration the Profit and Losses
[sic] of the respective companies, including in one of the cases, the
net liabilities in light of default in payments." Ayustar requests
that the Commission similarly consider its continuing monthly losses.
Ayustar claims that paying the forfeiture could have a negative impact
on its ability to retain employees.
5. We do not find that Ayustar's financial situation warrants a reduction
of the forfeiture. Generally, the Commission has found that "a
licensee's gross revenues are the best indicator of its ability to pay
a forfeiture." The Commission, citing PJB Communications, has also
held that "[i]f gross revenues are sufficiently great. . .the mere
fact that a business is operating at a loss does not itself mean that
it cannot afford to pay a forfeiture." Such is the case here.
Ayustar's documented gross revenues are sufficiently great that we do
not find a reduction appropriate. As Ayustar notes, the Commission has
in a few limited cases looked to other factors, including profits and
losses, to determine ability to pay. Those cases, however, involved
licensees in severe financial distress. Ayustar has failed to
demonstrate that it is experiencing a comparable level of financial
distress or that it otherwise should qualify for an exception to our
gross revenues policy. For example, unlike the entities in Pinnacle
Communications and First Greenville Corporation, Ayustar has not
indicated that it is facing foreclosure, that it is unable to secure
funding to cover its losses, or that its owners have personally
guaranteed loans on its behalf. Moreover, unlike the entity in Benito
Rish, Ayustar services a large metropolitan area, with a significant
potential customer base. Accordingly, based on our review of the
instant case, we deny Ayustar's petition for reconsideration and
affirm the forfeiture in the amount of $10,000.
IV. ORDERING CLAUSES
6. Accordingly, IT IS ORDERED, pursuant to Section 405 of the
Communications Act of 1934, as amended, and Section 1.106 of the
Commission's Rules, that the petition for reconsideration filed by
Ayustar Corporation IS DENIED.
7. IT IS ALSO ORDERED that, pursuant to Section 503(b) of the Act, and
Sections 0.111, 0.311 and 1.80(f)(4) of the Rules, Ayustar Corporation
IS LIABLE FOR A MONETARY FORFEITURE in the amount of ten thousand
dollars ($10,000) for willful and repeated violation of Section 301 of
the Act.
8. 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
Memorandum Opinion and 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 credit card, 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. Ayustar Corporation shall
also send electronic notification to SCR-Response@fcc.gov on the date
said payment is made.
9. IT IS FURTHER ORDERED that this Memorandum Opinion and Order shall be
sent by regular mail and by certified mail, return receipt requested,
to Ayustar Corporation at its address of record.
FEDERAL COMMUNICATIONS COMMISSION
P. Michele Ellison
Chief, Enforcement Bureau
Ayustar is a wireless internet service provider using Unlicensed National
Information Infrastructure (U-NII) devices in San Juan, PR.
Ayustar Corporation, Forfeiture Order, 25 FCC Rcd 945 (Enf. Bur. South
Central Region 2010) ("Forfeiture Order").
47 U.S.C. S: 301.
Ayustar Corporation, Notice of Apparent Liability for Forfeiture,
NAL/Acct. No. 201032680001 (Enf. Bur., rel. November 12, 2009) ("NAL").
Letter from Stefan Lechnar, Chief Executive Officer, Ayustar Corporation,
to San Juan Office at 1 (December 3, 2009) ("Ayustar Response").
Letter from Stefan Lechnar, Chief Executive Officer, Ayustar Corporation,
to Dennis P. Carlton, Regional Director, South Central Region, Enforcement
Bureau (February 2, 2010) ("Ayustar Petition").
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) ("Forfeiture Policy Statement"), recon. denied, 15
FCC Rcd 303 (1999).
47 U.S.C. S: 503(b)(2)(E).
Ayustar Petition at 1.
First Greenville Corporation, Memorandum Opinion and Order and Forfeiture
Order, 11 FCC Rcd 7399 (1996).
Benito Rish, Memorandum Opinion and Order, 10 FCC Rcd 2861 (1995).
Pinnacle Communications, Inc., Memorandum Opinion and Order, 11 FCC Rcd
15496 (1996).
Ayustar Petition at 1.
Id.
Forfeiture Policy Statement, 12 FCC Rcd at 17106.
Id.
See supra nn.12-14.
Cf. First Greenville Corporation (considered that the station's losses
exceeded its income and that the sole shareholder funded those losses and
received no income from the station when reducing proposed forfeiture);
Pinnacle Communications, Inc. (considered that the licensee was in default
of a loan personally guaranteed by licensee's owner, that the loan was
entered into to avoid foreclosure, and that the licensee and its owner
would receive no cash from sale of the license when cancelling
forfeiture).
Cf. Benito Rish (considered the station's unprofitable history and the
fact that it served a small community of license with a population of 425
when reducing proposed forfeiture).
47 U.S.C. S: 405.
47 C.F.R. S: 1.106.
47 U.S.C. S:S: 301, 503(b); 47 C.F.R. S:S: 0.111, 0.311, 1.80(f)(4).
47 U.S.C. S: 504(a).
Federal Communications Commission DA 10-2235
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Federal Communications Commission DA 10-2235