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Before the
Federal Communications Commission
Washington, D.C. 20554
)
)
)
In the Matter of ) File No. EB-06-TC-336
Progressive Business, Inc. ) NAL/Acct. No. 200832170047
Apparent Liability for Forfeiture ) FRN: 0017770504
)
)
)
ORDER
Adopted: February 1, 2011 Released: February 11, 2011
By the Commission:
I. introduction
1. In this Order, we find that a proposed forfeiture, issued by the
Commission to Progressive Business, Inc. ("Progressive Business") for
apparent willful and repeated violation of Section 227 of the
Communications Act of 1934, as amended ("Act"), and the Commission's
related rules and orders, should not be imposed. The forfeiture was
proposed in a Notice of Apparent Liability for Forfeiture ("NAL")
issued on June 3, 2008 in the amount of $84,500 to Progressive
Business for apparently delivering nine unsolicited advertisements to
the telephone facsimile machines of two customers. Progressive
Business filed a response to the NAL on June 11, 2008 ("June 11
Response") and additional information in response to inquiries from
Enforcement Bureau ("Bureau") staff. Based on our review of the
record, including this additional information, we find that
Progressive Business did not willfully and repeatedly violate a
Commission order or rule. Consequently, we conclude that no forfeiture
should be imposed.
II. BACKGROUND
2. Section 227(b)(1)(C) of the Act makes it "unlawful for any person
within the United States, or any person outside the United States if
the recipient is within the United States . . . to use any telephone
facsimile machine, computer, or other device to send, to a telephone
facsimile machine, an unsolicited advertisement." The term
"unsolicited advertisement" is defined in the Act and the Commission's
rules as "any material advertising the commercial availability or
quality of any property, goods, or services which is transmitted to
any person without that person's prior express invitation or
permission in writing or otherwise." Under the Commission's rules, an
"established business relationship" exception permits a party to
deliver a message to a consumer if the sender has an established
business relationship with the recipient and the sender obtained the
number of the facsimile machine through the voluntary communication by
the recipient, directly to the sender, within the context of the
established business relationship, or through a directory,
advertisement, or a site on the Internet to which the recipient
voluntarily agreed to make available its facsimile number for public
distribution.
3. On September 11, 2006, in response to one consumer complaint alleging
that Progressive Business had faxed unsolicited advertisements, the
Bureau issued a citation to Progressive Business, pursuant to section
503(b)(5) of the Act. The Bureau cited Progressive Business for using
a telephone facsimile machine, computer, or other device, to send
unsolicited advertisements for business posters to a telephone
facsimile machine, in violation of section 227 of the Act and the
Commission's related rules and orders. The citation warned Progressive
Business that subsequent violations could result in the imposition of
monetary forfeitures of up to $11,000 per violation, and included a
copy of the consumer complaint that formed the basis of the citation.
The citation informed Progressive Business that within 30 days of the
date of the citation, it could either request an interview with
Commission staff, or could provide a written statement responding to
the citation. By letter dated September 19, 2006, Progressive Business
asserted in reply that it did not send unsolicited faxes and claimed
an established business relationship with National By Products Co. In
fact, however, the complainant was an employee of the City of Wichita,
Kansas, not National By Products Co. Bureau staff spoke with counsel
for Progressive Business by phone in an effort to resolve this
inconsistency. Progressive Business did not at that time submit a
further response or provide any basis for concluding that the City of
Wichita complaint was in fact associated with National By Products Co.
or that an established business relationship between the City of
Wichita and Progressive Business existed.
4. Subsequently, we received three additional complaints from two
consumers indicating that Progressive Business sent them nine
unsolicited facsimile transmissions after Progressive Business
received the citation. Based on those complaints, the Commission
issued a Notice of Apparent Liability for Forfeiture in the amount of
$84,500, concluding that Progressive Business apparently violated
section 227 of the Act and the Commission's related rules and orders
by sending nine unsolicited advertisements to the two consumers'
facsimile machines after the date of the citation.
5. In its June 11 Response to the NAL, Progressive Business claims
established business relationships with each of the companies involved
in both the citation and the NAL. With respect to the citation,
Progressive explains that it erred in its original response. Although
the complaint in the citation was from an employee of the City of
Wichita, and the complaint listed National By Products Co. as the
apparent sender, Progressive interpreted the complaint as coming from
National By Products Co. As a result, Progressive Business says, it
provided information that was correct in demonstrating a prior
business relationship with National By Product Co., but this
information did not apply to the complaint. Progressive Business now
claims established business relationships with both the City of
Wichita and National By Products Co., and that these relationships are
fully supported by detailed records.
6. Further, Progressive Business similarly claims established business
relationships with the two companies involved in the three complaints
cited in the NAL, Meadville Medical Center and Superior Systems.
Progressive Business supports its claims with letters and billing
information for the two companies, showing orders placed for
Progressive Business publications. In addition, following
conversations with Bureau staff, Progressive Business suppressed its
faxing to the Meadville Medical Center and Superior Systems fax
numbers that were the subject of the complaints and agreed to clarify
the opt-out language in its faxes to comply more closely with
Commission rules.
7. Section 503(b) of the Act authorizes the Commission to assess a
forfeiture for each violation of the Act, or of any rule, regulation,
or order issued by the Commission under the Act, by a non-common
carrier or other entity not specifically designated in section 503 of
the Act. The maximum penalty for such a violation is $11,000 for a
violation occurring before September 2, 2008, and $16,000 for a
violation occurring on or after September 2, 2008. In exercising such
authority, we are 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."
III. DISCUSSION
8. Upon review of the record, including Progressive Business's several
Responses, we conclude that Progressive Business has presented a
reasonable showing that it did have an established business
relationship with the City of Wichita, the source of the complaint in
the September 11, 2006 citation, as well as with the two businesses
that were the source of the subsequent complaints in the NAL. We
therefore conclude that the citation should be rescinded and that no
forfeiture should be imposed on Progressive Business. We note that in
its Sept. 11 Response, Progressive Business also expresses views
concerning the fulfillment of opt-out requests from businesses where
more than one person may use the same fax machine. That question is
not at issue here and our decision here not to impose a forfeiture
does not imply agreement with Progressive Business's views.
II. ordering clauses
9. ACCORDINGLY, IT IS ORDERED that, pursuant to section 503(b) of the
Communications Act of 1934, as amended, and sections 0.111, 0.311, and
1.80(f)(4) of the Commission's rules, the proposed forfeitures in the
Notice of Apparent Liability for Forfeiture against Progressive
Business WILL NOT BE IMPOSED.
10. IT IS FURTHER ORDERED that, pursuant to section 503(b) of the Act, 47
U.S.C. S: 503(b), and section 1.80(f)(4) of the Commission's rules, 47
C.F.R. S: 1.80(f)(4), the citation issued to Progressive Business,
Inc. by the Bureau on September 11, 2006, IS RESCINDED.
11. IT IS FURTHER ORDERED that a copy of this Order shall be sent to
Progressive Business, Inc., 370 Technology Drive, Malvern, PA 19355.
FEDERAL COMMUNICATIONS COMMISSION
Marlene H. Dortch
Secretary
Progressive Business, Notice of Apparent Liability for Forfeiture, 23 FCC
Rcd 9018 (2008).
Letter from Thomas D. Schubert, Progressive Business Chief Financial
Officer to Dan Grosh, Telecommunications Consumers Division, Enforcement
Bureau, File No. EB-06-TC-366, dated June 11, 2008 (June 11 Response).
See Letter from Thomas D. Schubert, Progressive Business Chief Financial
Officer to Dan Grosh, Telecommunications Consumers Division, Enforcement
Bureau, File No. EB-06-TC-366, dated June 27, 2008 (June 27 Response);
Email from Thomas D. Schubert, Progressive Business Chief Financial
Officer to Dan Grosh, Telecommunications Consumers Division, Enforcement
Bureau, File No. EB-06-TC-366, dated July 15, 2008 ( July 15 Response);
and Letter from Thomas D. Schubert, Progressive Business Chief Financial
Officer to Dan Grosh, Telecommunications Consumers Division, Enforcement
Bureau, File No. EB-06-TC-366, dated Sept. 11, 2008 (Sept. 11 Response).
47 U.S.C. S: 227(b)(1)(C); 47 C.F.R. S: 64.1200(a)(3).
47 U.S.C. S: 227(a)(4); 47 C.F.R. S: 64.1200(f)(13).
An "established business relationship" is defined as a prior or existing
relationship formed by a voluntary two-way communication "with or without
an exchange of consideration, on the basis of an inquiry, application,
purchase or transaction by the business or residential subscriber
regarding products or services offered by such person or entity, which
relationship has not been previously terminated by either party." 47
C.F.R. S: 64.1200(f)(5).
See 47 U.S.C. S: 227(b)(1)(C); 47 C.F.R. S: 64.1200(a)(3)(i),(ii).
Citation from Kurt A. Schroeder, Deputy Chief, Telecommunications
Consumers Division, Enforcement Bureau, File No. EB-06-TC-336, issued to
Progressive Business on September 11, 2006.
See 47 U.S.C. S: 503(b)(5) (authorizing the Commission to issue citations
to non-common carriers for violations of the Act or of the Commission's
rules and orders).
Commission staff mailed the citation to Progressive Business, 370
Technology Drive, Malvern, PA 19355.
Letter from Thomas D'Agostino, Esq., Progressive Business Publications to
Kurt A. Schroeder, Deputy Chief, Telecommunications Consumers Division,
Enforcement Bureau, dated September 19, 2006.
June 11 Response. Following receipt of this Response, Commission staff
also forwarded copies of the three complaints cited in the NAL to
Progressive Business, to allow it to examine and respond to those
complaints. Fax from Dan Grosh, Telecommunications Consumers Division,
Enforcement Bureau, File No. EB-06-TC-336, sent to Attn: Thomas Schubert,
Progressive Business on June 19, 2008.
June 27 Response.
See Sept. 11 Response.
Section 503(b)(2)(C) provides for forfeitures up to $10,000 for each
violation in cases not covered by subparagraph (A) or (B), which address
forfeitures for violations by licensees and common carriers, among others.
See 47 U.S.C. S: 503(b). In accordance with the inflation adjustment
requirements contained in the Debt Collection Improvement Act of 1996,
Pub. L. 104-134, Sec. 31001, 110 Stat. 1321, the Commission implemented an
increase of the maximum statutory forfeiture under section 503(b)(2)(C)
first to $11,000 and more recently to $16,000. See 47 C.F.R. S:1.80(b)(3);
Amendment of Section 1.80 of the Commission's Rules and Adjustment of
Forfeiture Maxima to Reflect Inflation, 15 FCC Rcd 18221 (2000)
(forfeiture maximum for this type of violator set at $11,000); Amendment
of Section 1.80(b) of the Commission's Rules and Adjustment of Forfeiture
Maxima to Reflect Inflation, 19 FCC Rcd 10945 (2004) (amendment of section
1.80(b) to reflect inflation left the forfeiture maximum for this type of
violator at $11,000); Amendment of Section 1.80(b) of the Commission's
Rules, Adjustment of Forfeiture Maxima to Reflect Inflation, 23 FCC Rcd
9845 (2008) (amendment of section 1.80(b) to reflect inflation increased
the forfeiture maximum for this type of violator to $16,000).
47 U.S.C. S: 503(b)(2)(D); 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, 17100-01 para. 27 (1997)
(Forfeiture Policy Statement), recon. denied, 15 FCC Rcd 303 (1999).
See 47 C.F.R. S: 64.1200(a)(3)(iv) and Rules and Regulations Implementing
the Telephone Consumer Protection Act of 1991, Junk Fax Protection Act of
2005, Report and Order and Third Order on Reconsideration, 21 FCC Rcd
3787, 3804 para. 31 (2006).
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