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Before the
Federal Communications Commission
Washington, D.C. 20554
)
)
File No.: EB-11-SE-104
In the Matter of )
NAL/Acct. No.: 201232100017
Locus Telecommunications, Inc. )
FRN: 0010729515
)
)
Notice of apparent Liability for forfeiture
AND ADMONISHMENT
Adopted: December 28, 2011 Released: December 29, 2011
By the Chief, Enforcement Bureau:
I. introduction
1. In this Notice of Apparent Liability for Forfeiture and Admonishment,
we propose a forfeiture in the amount of twenty-five thousand five
hundred dollars ($25,500) and issue an admonishment against Locus
Telecommunications, Inc. ("Locus"). As detailed herein, we find that
Locus apparently willfully and repeatedly violated sections
20.19(c)(3)(ii) and 20.19(d)(3)(ii) of the Commission's rules
("Rules"). We further find that some of this apparent misconduct
continued for the entire 2010 calendar year. Specifically, Locus
apparently failed to offer to consumers the required number or
percentage of hearing aid-compatible digital wireless handset models
that operate on the GSM air interface as set forth in the Rules. These
hearing aid compatibility requirements serve to ensure that consumers
with hearing loss have access to advanced telecommunications services.
II. BACKGROUND
2. In the 2003 Hearing Aid Compatibility Order, the Commission adopted
several measures to enhance the ability of consumers with hearing loss to
access digital wireless telecommunications. The Commission established
technical standards that digital wireless handsets must meet to be
considered compatible with hearing aids operating in acoustic coupling and
inductive coupling (telecoil) modes. Specifically, the Commission adopted
a standard for radio frequency interference (the "M3" rating) to enable
acoustic coupling between digital wireless phones and hearing aids
operating in acoustic coupling mode, and a separate standard (the "T3"
rating) to enable inductive coupling with hearing aids operating in
telecoil mode.
1. In the 2008 Hearing Aid Compatibility First Report and Order, the
Commission established several deadlines between 2008 and 2011 by
which manufacturers and service providers must offer specified numbers
or percentages of digital wireless handset models that are rated as
hearing aid-compatible. The number or percentage of digital wireless
handset models required to be offered to consumers by each deadline
depends on the applicable compatibility standard ("M" rating or "T"
rating), and the deployment schedule is tailored to the size of the
service provider as measured by its number of subscribers.
Specifically, between May 15, 2009 and May 14, 2010, non-Tier I
service providers were required to ensure that at least nine handset
models per digital air interface, or at least 50% of the models
offered per digital air interface, met or exceeded the M3 rating, and
that at least five handset models per digital air interface, or at
least one-third of the models offered per digital air interface, met
or exceeded the T3 rating. Beginning May 15, 2010, non-Tier I service
providers were required to offer to consumers at least ten handset
models per digital air interface, or at least 50% of the models
offered per digital air interface, that met or exceeded the M3 rating.
Similarly, between May 15, 2010 and May 14, 2011, non-Tier I service
providers were required to offer at least seven handset models per
digital air interface, or at least one-third of the models offered per
digital air interface, that met or exceeded the T3 rating.
2. On January 18, 2011, Locus submitted a hearing aid compatibility
status report covering January 1, 2010 to December 31, 2010. Locus
identified each handset model offered to consumers in its retail
stores and on its website, www.h2owirelessnow.com, and specified the
model's FCC Identification ("FCC ID") as well as the hearing aid
compatibility rating, if any. After a careful review of Locus's
submission, the Wireless Telecommunications Bureau referred this
matter to the Enforcement Bureau ("Bureau") for investigation. As
part of its investigation, the Bureau consulted the FCC Office of
Engineering and Technology ("OET") Equipment Authorization System to
independently confirm the hearing aid compatibility rating of each
handset model as established in the grant of equipment authorization
issued by the Commission for that handset. Taking into account the
manufacturer-reported information in the OET database, including
information that would be more favorable to Locus than the information
in its own submission, we conclude that Locus apparently failed to
offer, for extended periods during the 2010 calendar year, the
required number or percentage of minimum M3 and T3-rated handset
models that operate on the GSM air interface.
III. DISCUSSION
A. Failure to Comply with Hearing Aid-Compatible Handset Deployment
Requirements
3. Acoustic Coupling ("M3" or higher rating). We find that Locus
apparently failed to offer to consumers the required number or
percentage of hearing aid-compatible handset models with a minimum M3
rating that operate on the GSM air interface. As noted above, the
Commission has imposed varying benchmarks for the deployment of
hearing aid-compatible handsets. Between January 1, 2010 and May 31,
2010, Locus was required to offer at least two M3 or higher rated
handset models. As set forth in greater detail in Appendix A, Locus
apparently failed to meet this standard, repeatedly falling short by
one handset model. During the latter part of the 2010 reporting
period, Locus was required to offer at least three M3 or higher rated
handset models during the period June 1 through December 31, 2010.
Locus also apparently failed to meet this standard, repeatedly falling
short by one to two handset models. Accordingly, we find that Locus
apparently willfully and repeatedly violated section 20.19(c)(3)(ii)
of the Rules by failing to offer to consumers the required number or
percentage of digital wireless handset models with a minimum M3 rating
that operate on the GSM air interface. We also find that this apparent
misconduct continued for the entire 2010 calendar year.
4. Inductive Coupling ("T3" or higher rating). We further find that Locus
apparently failed to offer to consumers the required number or
percentage of hearing aid-compatible handset models that met or
exceeded the T3 rating that operate on the GSM air interface. Between
January 1, 2010 and December 31, 2010, Locus was required to offer at
least two handset models rated T3 or higher. As set forth in greater
detail in Appendix B, Locus apparently failed to meet this standard
between January 1, 2010 and June 30, 2010 by offering only one handset
model with a minimum T3 rating. Accordingly, we find that Locus
apparently willfully and repeatedly violated section 20.19(d)(3)(ii)
of the Rules by failing to offer to consumers the required number or
percentage of digital wireless handset models with a minimum T3 rating
that operate on the GSM air interface.
B. Proposed Forfeiture
5. 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 for forfeiture 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. We conclude under this standard that Locus is
apparently liable for a forfeiture for its apparent willful and
repeated violations of section 20.19(c)(3)(ii) of the Rules.
6. Section 503(b)(2)(B) of the Act authorizes a forfeiture assessment
against a common carrier up to $150,000 for each violation, or for
each day of a continuing violation, up to a maximum of $1,500,000 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."
7. The Commission's Forfeiture Policy Statement and section 1.80 of the
Rules do not establish a base forfeiture amount for violations of the
hearing aid-compatible handset requirements set forth in section 20.19
of the Rules. The fact that the Forfeiture Policy Statement does not
specify a base amount in no way suggests that a forfeiture should not
be imposed. The Forfeiture Policy Statement states that "any omission
of a specific rule violation from the ... [forfeiture guidelines] ...
should not signal that the Commission considers any unlisted violation
as nonexistent or unimportant." The Commission retains the discretion,
moreover, to depart from the Forfeiture Policy Statement and issue
forfeitures on a case-by-case basis, under its general forfeiture
authority contained in section 503 of the Act.
8. In determining the appropriate forfeiture amount for violation of the
hearing aid-compatible handset deployment requirements, we take into
account that these requirements serve to ensure that consumers with
hearing loss have access to advanced telecommunications services. In
adopting the hearing aid compatibility rules, the Commission
underscored the strong and immediate need for such access, stressing
that individuals with hearing loss should not be denied the public
safety and convenience benefits of digital wireless telephony.
Moreover, as the Commission has noted, the demand for hearing
aid-compatible handsets is likely to increase with the public's
growing reliance on wireless technology and with the increasing median
age of our population.
9. We have previously determined that violations of the hearing
aid-compatible handset deployment requirements are serious in nature
because failure to make compatible handsets available to consumers
actually prevents hearing aid users from accessing digital wireless
communications. Accordingly, we generally apply a base forfeiture
amount of $15,000 to reflect the gravity of these violations. We have
applied the $15,000 base forfeiture on a per handset model basis
(i.e., for each handset model below the minimum number of hearing
aid-compatible models required by the Rules).
10. For purposes of calculating the base forfeiture amount for Locus's
apparent M3-related violations on the GSM air interface, we focus on
the company's failure to offer to consumers the requisite number or
percentage of handset models with a minimum M3 rating in December
2010, when Locus missed the benchmark by one handset model.
Accordingly, and consistent with section 503(b)(6) of the Act, we
start with a base forfeiture of $15,000 for Locus's apparent failure
to offer to consumers the required number or percentage of handset
models rated M3 or higher that operate on the GSM air interface in
willful and repeated violation of section 20.19(c)(3)(ii) of the
Rules.
11. This base forfeiture amount, however, is subject to adjustment. Given
the totality of the circumstances, and consistent with the Forfeiture
Policy Statement, we conclude that an upward adjustment of the $15,000
base forfeiture amount is warranted. In this regard, we take into
account that Locus was out of compliance with the hearing aid
compatibility handset deployment requirements for the entire 2010
calendar year. In addition, and as the Commission made clear in the
Forfeiture Policy Statement, large or highly profitable entities, such
as Locus, should expect forfeitures higher than those reflected in the
base amounts in order to ensure that the forfeiture serves as an
effective deterrent against future non-compliance. Therefore, based on
all the factors and evidence, including the duration of the violation,
Locus's ability to pay the proposed forfeiture, and the potentially
significant impact on consumers with hearing loss, we propose a
forfeiture of $25,500 against Locus for apparently willfully and
repeatedly failing to comply with the hearing aid-compatible handset
deployment requirements set forth in section 20.19(c)(3)(ii) of the
Rules.
C. Admonishment
12. The record also establishes that Locus apparently failed to offer from
January through June 2010 the requisite number or percentage of
handset models with a minimum T3 rating that operate on the GSM
interface, missing the benchmark by one handset model. Although we
believe that a separate, monetary forfeiture would be warranted for
this violation, we note that the statute of limitations for proposing
a forfeiture is one year from the date of violation. Accordingly,
based upon our review of the facts and circumstances in this case, we
admonish Locus for its failure to offer to consumers from January
through June 2010 the requisite number or percentage of handset models
with a minimum T3 rating, in violation of section 20.19(d)(3)(ii) of
the Rules.
IV. ORDERING clauses
15. Accordingly, IT IS ORDERED that, pursuant to section 503(b) of the
Act, and sections 0.111, 0.311, and 1.80 of the Rules, Locus
Telecommunications, Inc. IS NOTIFIED of its APPARENT LIABILITY FOR A
FORFEITURE in the amount of twenty-five thousand five hundred dollars
($25,500) for apparent willful and repeated violation of section
20.19(c)(3)(ii) of the Rules.
16. IT IS FURTHER ORDERED that, pursuant to section 1.80 of the Rules,
within thirty (30) calendar days after the release date of this Notice of
Apparent Liability for Forfeiture and Admonishment, Locus
Telecommunications, Inc., SHALL PAY the full amount of the proposed
forfeiture or SHALL FILE a written statement seeking reduction or
cancellation of the proposed forfeiture.
17. IT IS FURTHER ORDERED that Locus Telecommunications, Inc. IS
ADMONISHED for apparent willful and repeated violation of section
20.19(d)(3)(ii) of the Rules.
18. 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 referenced above. Payment by
check or money order may be mailed to the 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. Locus Telecommunications, Inc.
must also send electronic notification to Nissa Laughner at
Nissa.Laughner@fcc.gov, Pamera Hairston at Pamera.Hairston@fcc.gov, and
Samantha Peoples at Sam.Peoples@fcc.gov on the date said payment is made.
19. The written statement seeking reduction or cancellation of the
proposed forfeiture, if any, must include a detailed factual statement
supported by appropriate documentation and affidavits pursuant to sections
1.80(f)(3) and 1.16 of the Rules. The written statement 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/Account Number referenced
in the caption. This statement also must be emailed to Nissa Laughner at
Nissa.Laughner@fcc.gov and Pamera Hairston at Pamera.Hairston@fcc.gov.
20. 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
("GAAP"); 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.
21. IT IS FURTHER ORDERED that a copy of this Notice of Apparent Liability
for Forfeiture and Admonishment shall be sent by first class mail and
certified mail return receipt requested to Jason Chon, CEO; John Chough,
Chairman; and Sam Lee, President, Locus Telecommunications, Inc., 111
Sylvan Avenue, Englewood Cliffs, NJ 07632.
FEDERAL COMMUNICATIONS COMMISSION
P. Michele Ellison
Chief
Enforcement Bureau
APPENDIX A
Locus Telecommunications, Inc.
Hearing Aid-Compatible Handset Model Offerings
GSM Air Interface
(M3 or higher rating)
Total M3-rated M3
Period Handset Handset M3-rated Handset
Models Models Models Required Compliance?
Offered Offered
January 4 1 No
2010
February 4 1 No
2010
March 4 1 No
2010
April 4 1 No
2010
May 1-14, 4 1 No
2010
May the total number
15-31, 4 1 of handset models No
2010 offered or
June 2010 5 1 at least 9 No
July 2010 6 2 At least 50% of No
August 6 2 of handset models No
2010 offered or
September 6 2 at least 10 No
2010 handset models
October 6 2 (5/15/10-12/31/10) No
2010
November 6 2 No
2010
December 6 2 No
2010
APPENDIX B
Locus Telecommunications, Inc.
Hearing Aid-Compatible Handset Model Offerings
GSM Air Interface
(T3 or higher rating)
Total T3-rated T3
Period Handset Handset T3-rated Handset
Models Models Models Required Compliance?
Offered Offered
January 4 1 No
2010
February 4 1 No
2010
March 4 1 No
2010
April 4 1 No
2010
May 1-14, 4 1 No
2010 At least 1/3 of
May of handset
15-31, 4 1 models offered No
2010 or
June 2010 5 1 at least 5 No
July 2010 6 2 At least 1/3 of Yes
August 6 2 of handset models Yes
2010 offered or
September 6 2 at least 7 handset Yes
2010 models
October 6 2 (5/15/10-12/31/10) Yes
2010
November 6 2 Yes
2010
December 6 2 Yes
2010
Locus is a Tier III carrier serving 70,000 locations. Tier III carriers
are non-nationwide wireless radio service providers with 500,000 or fewer
subscribers as of the end of 2001. See Revision of the Commission's Rules
to Ensure Compatibility with Enhanced 911 Emergency Calling Systems, Phase
II Compliance Deadlines for Non-Nationwide CMRS Carriers, Order to Stay,
17 FCC Rcd 14841, 14847-48 P:P: 22-23 (2002).
47 C.F.R. S: 20.19(c)(3)(ii), (d)(3)(ii).
Section 68.4(a) of the Commission's Rules Governing Hearing Aid-Compatible
Telephones, Report and Order, 18 FCC Rcd 16753 (2003); Erratum, 18 FCC Rcd
18047 (2003) ("Hearing Aid Compatibility Order"); Order on
Reconsideration and Further Notice of Proposed Rulemaking, 20 FCC Rcd
11221 (2005). The Commission adopted these requirements for digital
wireless telephones under the authority of the Hearing Aid Compatibility
Act of 1988, codified at section 710(b)(2)(B) of the Communications Act of
1934, as amended (the "Act"), 47 U.S.C. S: 610(b)(2)(B).
See Hearing Aid Compatibility Order, 18 FCC Rcd at 16777 P: 56. See also
47 C.F.R. S: 20.19(b)(1), (2). The Hearing Aid Compatibility Order
described the acoustic coupling and the inductive coupling (telecoil)
modes as follows:
In acoustic coupling mode, the microphone picks up surrounding sounds,
desired and undesired, and converts them into electrical signals. The
electrical signals are amplified as needed and then converted back into
sound by the hearing aid speaker. In telecoil mode, with the microphone
turned off, the telecoil picks up the audio signal-based magnetic field
generated by the voice coil of a dynamic speaker in hearing aid-compatible
telephones, audio loop systems, or powered neck loops. The hearing aid
converts the magnetic field into electrical signals, amplifies them as
needed, and converts them back into sound via the speaker. Using a
telecoil avoids the feedback that often results from putting a hearing aid
up against a telephone earpiece, can help prevent exposure to over
amplification, and eliminates background noise, providing improved access
to the telephone.
Hearing Aid Compatibility Order, 18 FCC Rcd at 16763 P: 22.
As subsequently amended, section 20.19(b)(1) provides that, for the period
beginning January 1, 2010, a wireless handset is deemed hearing
aid-compatible for radio frequency interference if, at a minimum, it meets
the M3 rating associated with the technical standard set forth in the
standard document "American National Standard Methods of Measurement of
Compatibility between Wireless Communication Devices and Hearing Aids,"
ANSI C63.19-2007 (June 8, 2007) ("ANSI C63.19-2007"), except that grants
of certification issued before January 1, 2010 under earlier versions of
ANSI C63.19 remain valid for hearing aid compatibility purposes. 47 C.F.R.
S: 20.19(b)(1). Section 20.19(b)(2) provides that, for the period
beginning January 1, 2010, a wireless handset is deemed hearing
aid-compatible for inductive coupling if, at minimum, it meets the T3
rating associated with the technical standard set forth in ANSI
C63.19-2007, except that grants of certification issued before January 1,
2010 under earlier versions of ANSI C63.19 remain valid for hearing aid
compatibility purposes. 47 C.F.R. S: 20.19(b)(2).
These handset deployment requirements apply to each air interface over
which the service providers offer service. See Amendment of the
Commission's Rules Governing Hearing Aid-Compatible Mobile Handsets, First
Report and Order, 23 FCC Rcd 3406, 3419 P:P: 35-36 (2008) (stating that
the hearing aid-compatible handset deployment requirements apply on a per
air interface basis) ("Hearing Aid Compatibility First Report and Order"),
Order on Reconsideration and Erratum, 23 FCC Rcd 7249 (2008). However,
these handset deployment benchmarks do not apply to service providers and
manufacturers that meet the de minimis exception. See Amendment of the
Commission's Rules Governing Hearing Aid-Compatible Mobile Handsets, First
Report and Order, 23 FCC Rcd 3406, 3413 P: 204 (2008) ("Hearing Aid
Compatibility First Report and Order"), Order on Reconsideration and
Erratum, 23 FCC Rcd 7249 (2008); 47 C.F.R. S: 20.19(e). The de minimis
exception provides that manufacturers or mobile service providers that
offer two or fewer digital wireless handset models per air interface are
exempt from the hearing aid compatibility requirements, and manufacturers
or service providers that offer three digital wireless handset models per
air interface must offer at least one compliant model. 47 C.F.R. S:
20.19(e). Effective September 10, 2012, the de minimis exception will not
be available to manufacturers or mobile service providers that do not meet
the definition of a "small entity" beginning two years after their initial
offerings. 47 C.F.R. S: 20.19(e)(1)(ii); see also Amendment of the
Commission's Rules Governing Hearing Aid-Compatible Mobile Handsets,
Policy Statement and Second Report and Order and Further Notice of
Proposed Rulemaking, 25 FCC Rcd 11167, 11180-89 P:P: 35-59 (2010).
The term "air interface" refers to the technical protocol that ensures
compatibility between mobile radio service equipment, such as handsets,
and the service provider's base stations. Currently, the leading air
interfaces include CDMA, GSM, Wideband Code Division Multiple Access
("WCDMA") a.k.a. Universal Mobile Telecommunications System ("UMTS"), and
Integrated Digital Enhanced Network ("iDEN").
See Hearing Aid Compatibility First Report and Order, 23 FCC Rcd at 3419
P: 35; 47 C.F.R. S: 20.19(c)(3)(ii).
See Hearing Aid Compatibility First Report and Order, 23 FCC Rcd at 3419
P: 36; 47 C.F.R. S: 20.19(d)(3)(ii).
See supra note 8.
See supra note 9.
Locus Telecommunications, Inc. Hearing Aid Compatibility Status Report
(filed Jan. 18, 2011), available at
http://wireless.fcc.gov/hac_documents/110210/5940483_195.PDF ("2010
Report").
The FCC Office of Engineering and Technology Equipment Authorization
System is the electronic database of all equipment certified under FCC
authority. This database identifies the hearing aid compatibility rating
of each device by FCC ID, as reported by the handset manufacturer in test
reports submitted to the Commission at the time of an equipment
authorization or of any modifications to such authorization. See
http://transition.fcc.gov/oet/ea/fccid/.
We note that our review revealed an apparent inconsistency between the
hearing aid compatibility rating for one model listed in the 2010 Report
and the ratings specified in the Commission's equipment authorization for
this model. Specifically, Locus's 2010 Report indicated that the Motorola
EM330 model (IHDP56JJ1) has a M3 rating when in fact Commission records
show that the handset model has a M3/T3 rating.
See supra notes 13 and 14 and accompanying text.
See Hearing Aid Compatibility First Report and Order, 23 FCC Rcd at 3419
P: 35; 47 C.F.R. S: 20.19(c)(3)(ii) (requiring non-Tier I digital wireless
service providers to ensure that between May 15, 2009 and May 14, 2010,
either at least 50% of the handset models offered, or at least nine
handset models, met or exceeded the M3 rating for radio frequency
interference, and that beginning May 15, 2010, at least 50% of the handset
models offered, or at least ten handset models, met or exceeded the M3
rating for radio frequency interference).
See Appendix A, Locus Telecommunications, Inc., Hearing Aid-Compatible
Handset Model Offerings, GSM Air Interface (M3 or higher rating)
(indicating that between January 1, 2010 and May 31, 2010, Locus offered
four handset models, only one of which had a minimum M3 rating).
See 47 C.F.R. S: 20.19(c)(3)(ii) (requiring non-Tier I digital wireless
service providers to ensure that beginning May 15, 2010, either at least
50% of the handset models offered, or at least ten handset models, met or
exceeded the M3 rating for radio frequency interference).
See Appendix A (indicating that between June 1, 2010 and December 31,
2010, Locus offered five or six handset models, only one to two of which
had a minimum M3 rating). Specifically, Locus fell short by two handset
models in June 2010 and by one handset model during the remainder of this
period.
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 clarifies that this definition of willful applies to both
sections 312 and 503 of the Act, H.R. Conf. Rep. No. 97-765, (1982), and
the Commission has so interpreted the term in the section 503(b) context.
See Southern California Broadcasting Co., Memorandum Opinion and Order, 6
FCC Rcd 4387, 4388 P: 5 (1991), recon. denied, 7 FCC Rcd 3454 (1992)
("Southern California"); see also Telrite Corporation, Notice of Apparent
Liability for Forfeiture, 23 FCC Rcd 7231, 7237 P: 12 (2008); San Jose
Navigation, Inc., Forfeiture Order, 22 FCC Rcd 1040, 1042 P: 9 (2007),
consent decree ordered, Order and Consent Decree, 25 FCC Rcd 1494 (2010).
Section 312(f)(2) of the Act, which also applies to forfeitures assessed
pursuant to section 503(b) of the Act, provides that "[t]he term
`repeated' ... means the commission or omission of such act more than once
or, if such commission or omission is continuous, for more than one day."
47 U.S.C. S: 312(f)(2). See Callais Cablevision, Inc., Notice of Apparent
Liability for Monetary Forfeiture, 16 FCC Rcd 1359, 1362 P: 9 (2001),
forfeiture ordered, Forfeiture Order, 17 FCC Rcd 22626 (2002) (forfeiture
paid); Southern California, 6 FCC Rcd at 4388 P: 5.
See Hearing Aid Compatibility First Report and Order, 23 FCC Rcd at 3419
P: 36; 47 C.F.R. S: 20.19(d)(3)(ii) (requiring non-Tier I digital wireless
service providers to ensure that between May 15, 2009 and May 14, 2010,
either at least one-third of the handset models offered, or at least five
handset models, met or exceeded the T3 rating for inductive coupling, and
that between May 15, 2010 and May 14, 2011, either at least one-third of
the handset models they offered, or at least seven handset models, met or
exceeded the T3 rating for inductive coupling).
See Appendix B, Locus Telecommunications, Inc., Hearing Aid-Compatible
Handset Model Offerings, GSM Air Interface (T3 or higher rating)
(indicating that between January 1, 2010 and June 30, 2010, Locus
repeatedly fell short of the hearing aid-compatible handset deployment
requirements by one handset model).
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)(4); 47 C.F.R. S: 1.80(f).
See, e.g., SBC Communications, Inc., Forfeiture Order, 17 FCC Rcd 7589,
7591 P: 4 (2002).
47 U.S.C. S: 503(b)(2)(B). The Commission has amended section 1.80(b)(2)
of the Rules, 47 C.F.R. S: 1.80(b)(2), three times to increase the maximum
forfeiture amounts, in accordance with the inflation adjustment
requirements contained in the Federal Civil Penalties Inflation Adjustment
Act of 1990, 28 U.S.C. S: 2461 note, as amended by the Debt Collection
Improvement Act of 1996, 31 U.S.C. S: 3701 note. The most recent inflation
adjustment took effect September 2, 2008 and applies to violations that
occur after that date. See Amendment of Section 1.80(b) of the
Commission's Rules, Adjustment of Forfeiture Maxima to Reflect Inflation,
Order, 23 FCC Rcd 9845, 9847 (2008) (adjusting the maximum statutory
amounts for common carriers from $130,000/$1,325,000 to
$150,000/$1,500,000); 73 Fed. Reg. 44663-5.
47 U.S.C. S: 503(b)(2)(E). See also 47 C.F.R. S: 1.80(b)(5), Note to
paragraph (b)(5): 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 (1997), recon. denied, Memorandum Opinion and
Order, 15 FCC Rcd 303 (1999) ("Forfeiture Policy Statement"); 47 C.F.R.
S:S: 1.80, 20.19.
Forfeiture Policy Statement, 12 FCC Rcd at 17099 P: 22.
Id.
Hearing Aid Compatibility Order, 18 FCC Rcd at 16755 P: 4.
Id. at 16756 P: 5 (noting that approximately one in ten Americans, or 28
million Americans, have some level of hearing loss, that the proportion
increases with age, and that the number of those affected will likely grow
as the median age increases). See also Section 68.4(a) of the Commission's
Rules Governing Hearing Aid-Compatible Telephones, Report on the Status of
Implementation of the Commission's Hearing Aid Compatibility Requirements,
22 FCC Rcd 17709, 17719 P: 20 (2007) (noting, just four years later, that
the number of individuals with hearing loss in the United States was "at
an all time high of 31 million people - with that number expected to reach
approximately 40 million people at the end of [2010]").
See South Canaan Cellular Communications Company, L.P, Notice of Apparent
Liability for Forfeiture, 23 FCC Rcd 20, 24 P: 11(Enf. Bur., Spectrum Enf.
Div. 2008) (forfeiture paid) ("South Canaan") (finding that "a violation
of the labeling requirements, while serious because it deprives hearing
aid users from making informed choices, is less egregious than a violation
of the handset requirements because failure to make compliant handsets
available actually deprives hearing aid users from accessing digital
wireless communications."). See also, e.g., NEP Cellcorp, Inc., Notice of
Apparent Liability for Forfeiture, 24 FCC Rcd 8, 13 P: 11 (Enf. Bur.,
Spectrum Enf. Div. 2009) (forfeiture paid) ("NEP Cellcorp"); Pinpoint
Wireless, Inc., Notice of Apparent Liability for Forfeiture, 23 FCC Rcd
9290, 9295 P: 11 (Enf. Bur., Spectrum Enf. Div. 2008), consent decree
ordered, Order and Consent Decree, 24 FCC Rcd 2951 (Enf. Bur., Spectrum
Enf. Div. 2009) ("Pinpoint Wireless"); Smith Bagley, Inc., Notice of
Apparent Liability for Forfeiture, 24 FCC Rcd 14113, 14118 P: 11 (Enf.
Bur., Spectrum Enf. Div. 2009), response pending ("Smith Bagley").
See, e.g., NEP Cellcorp, 24 FCC Rcd at 13 P: 11; Pinpoint Wireless, 23 FCC
Rcd at 9295 P: 11; Smith Bagley, 24 FCC Rcd at 14118 P: 11; South Canaan,
23 FCC Rcd at 24 P: 11.
See supra note 35.
See supra para. 5.
See 47 C.F.R. S: 1.80(b)(5), Note to Paragraph (b)(5): Section II.
Adjustment Criteria for Section 503 Forfeitures (establishing "repeated or
continuous violation" as an upward adjustment factor). While section
503(b)(6) of the Act bars the Commission from proposing a forfeiture for
violations that occurred more than a year prior to the issuance of a
notice of apparent liability for forfeiture, we may consider the fact that
Locus's misconduct occurred over an extended period to place "the
violations in context, thus establishing the licensee's degree of
culpability and the continuing nature of the violations." See Roadrunner
Transportation Inc., Forfeiture Order, 15 FCC Rcd 9669, 9671-72 P: 8
(2000); BASF Corporation, Notice of Apparent Liability for Forfeiture, 25
FCC Rcd 17300, 17302 n.24 (Enf. Bur., Spectrum Enf. Div. 2010); Call
Mobile, Inc., Notice of Apparent Liability for Forfeiture, 26 FCC Rcd 74,
76 n.23 (Enf. Bur., Spectrum Enf. Div. 2011). The forfeiture amount we
propose herein relates only to Locus's apparent violations that have
occurred within the past year.
Specifically, the Commission stated:
[W]e recognize that for large or highly profitable communication entities,
the base forfeiture amounts ... are generally low. In this regard, we are
mindful that, as Congress has stated, for a forfeiture to be an effective
deterrent against these entities, the forfeiture must be issued at a high
level. For this reason, we caution all entities and individuals that,
independent from the uniform base forfeiture amounts ..., we intend to
take into account the subsequent violator's ability to pay in determining
the amount of a forfeiture to guarantee that forfeitures issued against
large or highly profitable entities are not considered merely an
affordable cost of doing business. Such large or highly profitable
entities should expect in this regard that the forfeiture amount set out
in a Notice of Apparent Liability against them may in many cases be above,
or even well above, the relevant base amount.
Forfeiture Policy Statement, 12 FCC Rcd at 17099-100 P: 24.
See Locus 2011 FCC Form 499-A (Telecommunications Reporting Worksheet
(Reporting Calendar 2010 Revenues)).
47 C.F.R. S: 20.19(c)(3)(ii).
See supra para. 6.
See 47 U.S.C. S: 503(b)(6)(B); 47 C.F.R. S: 1.80(c)(3).
47 C.F.R. S: 20.19(d)(3)(ii).
47 U.S.C. S: 503(b); 47 C.F.R. S:S: 0.111, 0.311, 1.80.
47 C.F.R. S: 20.19(c)(3)(ii).
47 C.F.R. S: 1.80.
47 C.F.R. S: 20.19(d)(3)(ii).
47 C.F.R. S:S: 1.80(f)(3), 1.16.
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Federal Communications Commission DA 11-2078
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Federal Communications Commission DA 11-2078