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Before the
Federal Communications Commission
Washington, D.C. 20554
)
) File No. EB-06-IH-2110
In the Matter of
) NAL/Acct. No. 200932080022
ADMA Telecom, Inc.
) FRN No. 0015301732
)
FORFEITURE ORDER
Adopted: March 9, 2011 Released: March 10, 2011
By the Commission:
I. INTRODUCTION
1. In this Forfeiture Order, we assess a monetary forfeiture of $662,541
against ADMA Telecom, Inc. ("ADMA"). We find that ADMA willfully and
repeatedly violated sections 214, 225, 251(e)(2), and 254 of the
Communications Act of 1934, as amended (the "Act"), and sections
1.1157, 52.17(a), 54.706(a), 54.711(a), 63.18,
64.604(c)(5)(iii)(A)-(B), and 64.1195 of the Federal Communications
Commission's (the "Commission's" or "FCC's") rules by (1) failing to
register with the Commission, (2) failing to make required regulatory
filings, (3) failing to obtain an international section 214
authorization, and (4) failing to contribute fully and timely to the
Universal Service Fund ("USF"), Telecommunications Relay Service
("TRS") Fund, and cost recovery mechanisms for the North American
Numbering Plan ("NANP") administration.
II. BACKGROUND
2. The facts and circumstances upon which this Forfeiture Order are based
are set forth in detail in the ADMA NAL, and need not be repeated here
at length. ADMA is a Florida-based company that has provided
telecommunications services since 2001, primarily providing prepaid
calling cards for calling to international destinations. ADMA also
sells the telecommunications services of a related entity, Business
Telecommunications Services, Inc. ("BTS"), owned by ADMA's two
shareholders. ADMA obtains telecommunications switching capacity and
administrative support from BTS.
3. An Enforcement Bureau ("Bureau") investigation showed that ADMA failed
to comply with the Commission's registration requirement as well as
its contribution and revenue filing requirements from the time it
first provided telecommunications services in the United States in
2001 until August 2006. Specifically, ADMA failed to timely file
quarterly and annual worksheets due in February 2006, April 2006, and
May 2006, and failed to contribute to the USF from January through
October 2006. Similarly, ADMA failed to timely and fully remit its TRS
obligations and to make contributions to the NANP administration cost
recovery mechanism in 2005 and 2006. Finally, ADMA provided
international telecommunications services without obtaining
international section 214 authorization. On January 15, 2009, the ADMA
NAL proposed a forfeiture for these apparent violations in the total
amount of $672,541.
4. ADMA filed its response to the ADMA NAL on February 13, 2009. Therein,
ADMA alleges several defects in the Commission's proposed forfeiture.
First, ADMA argues that its revenue in 2006 qualified it for the de
minimis USF exemption and thus it was not required to submit the Form
499-Q due in the first half of 2006 and was not responsible for ten
months of unpaid USF. Second, ADMA asserts that it should not be
penalized for failing to pay three years worth of NANP invoices
because the invoices were mailed to the wrong address and ADMA never
received them. Third, ADMA argues that portions of the forfeiture are
outside the applicable statute of limitations. Each of these arguments
is addressed in detail below.
III. DISCUSSION
5. The proposed forfeiture in this case was assessed in accordance with
section 503(b)(1) of the Act, section 1.80 of the Commission's rules,
and the Commission's forfeiture guidelines set forth in its 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."
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. The legislative history to section
312(f)(1) of the Act clarifies that this definition of willful applies
to both sections 312 and 503(b) of the Act and the Commission has so
interpreted the term in the section 503(b) context. The Commission may
also assess a forfeiture for violations that are merely repeated, and
not willful. "Repeated" means that the act was committed or omitted
more than once, or lasts more than one day.
6. We have examined ADMA's response to the ADMA NAL pursuant to the
aforementioned statutory factors, our rules, and the Forfeiture Policy
Statement, and find by a preponderance of the evidence that ADMA
willfully and repeatedly violated the Commission's rules by failing to
register and submit annual and quarterly worksheets pursuant to
sections 54.711 and 64.1195 of the Commission's rules; failing to
timely and fully remit payments to the USF, TRS Fund, and cost
recovery mechanism for NANP administration; and failing to obtain an
international section 214 authorization to provide international
telecommunications services pursuant to section 63.18 of the
Commission's rules. We reduce by $10,000 the proposed forfeiture
amount for ADMA's failure to make timely contributions to the NANP
administration but deny ADMA's petition to further reduce or eliminate
the proposed forfeiture. We conclude that ADMA is liable for a
forfeiture of $662,541.
A. ADMA Is Liable For a Forfeiture For Failing to Register With the
Commission
7. In the ADMA NAL, the Commission found that ADMA began providing
interstate telecommunications service in 2001, but did not register
with the Commission until August 1, 2006, the date on which it filed
its first Form 499. We determined that ADMA was in apparent violation
of section 64.1195(a) of our rules and proposed a forfeiture of
$100,000. In its NAL Response, ADMA does not dispute that it violated
section 64.1195(a), nor does it quibble with the amount of the
penalty. ADMA contends, however, that the statute of limitations bars
the Commission from assessing a forfeiture. Section 503(b)(6) of the
Act states that no forfeiture shall be imposed against a carrier if
the violation charged occurred more than a year prior to the date of
issuance of an NAL. ADMA asserts that any violations that accrued
prior to December 8, 2005 are time barred as a result of a tolling
agreement signed December 8, 2006.
8. Consistent with our precedent, we find, however, that ADMA's failure
to register was a continuing violation that began on the day ADMA
started providing interstate telecommunications service without having
registered in accordance with section 64.1195(a) and continued until
it filed its first Form 499 on August 1, 2006. Thus, the limitations
period did not begin to run on the continuing violation until August
1, 2006 and would not have expired until August 1, 2007. Under the
December 8, 2006 tolling agreement, this violation is not time barred.
We therefore affirm both the ADMA NAL's finding that ADMA violated
section 64.1195(a) of the Commission's rules and its assessment of a
$100,000 forfeiture for that violation.
B. ADMA Is Liable For a Forfeiture For Failing to Submit
Telecommunications
Reporting Worksheets
9. In the ADMA NAL, the Commission concluded that ADMA apparently
violated sections 54.711(a) and 64.604(c)(5)(iii)(B) of the
Commission's rules by willfully and repeatedly failing to file any
Telecommunications Reporting Worksheets ("Worksheet") until August
2006. Thus, the Commission found that ADMA was apparently liable for a
$50,000 forfeiture for each of these failures to timely file
Worksheets which were due on February 1, 2006, April 1, 2006, and May
1, 2006.
10. ADMA admits that it did not file the annual Worksheet that was due on
April 1, 2006 until August 1, 2006, and that it did not file the
quarterly Worksheets due on February 1, 2006 and May 1, 2006 until
August 2, 2006. Yet, ADMA contends that it is excessive to assess a
$50,000 forfeiture for each failure to file a Worksheet when the
Worksheets were filed only a few months late. We reject ADMA's
position. As discussed in the ADMA NAL, the Telecommunications
Reporting Worksheet is not only an administrative tool, but a
fundamental and critical component of the Commission's Universal
Service program. The late filing of telecommunications reporting
worksheets, even if just by "a few months," results in delayed
payments, and difficulty in calculating contributions to USF, TRS, and
other regulatory fee programs. The Commission has consistently
assessed a forfeiture of $50,000 for failure to timely file a
Worksheet. ADMA's bald assertion that the forfeiture is too high does
not dissuade us from following our precedent.
11. In its NAL Response, ADMA also claims that it qualified for the de
minimis exemption under the Commission's universal service rules in
2006 and was therefore not required to file two of the three Form 499s
at issue (February and May 2006). Under the Commission's rules, a
company is considered de minimis for the purposes of the universal
service filing and contribution requirements if its contribution to
universal service in any given year would be less than $10,000.
Companies that qualify for this de minimis exemption are not required
to file a quarterly FCC Form 499-Q, but they are required to file a
completed FCC Form 499-A every year. We are not persuaded by ADMA's
argument and we affirm the ADMA NAL's finding that ADMA did not
qualify for the de minimis exemption and was therefore required to
file a February or May 2006 Form 499-Q.
12. The filing instructions for the 2006 Form 499-A (reporting calendar
year 2005 revenues) state that, "Telecommunications providers that do
not file this Worksheet because they are de minimis for purposes of
universal service contributions (and need not file for any other
purpose) should retain Figure 1 and documentation of their
contribution base revenues for 3 calendar years after the date each
Worksheet is due." Thus, ADMA should have documentation to support its
claim of de minimis status if it had properly determined that the
company qualified. But ADMA relies not on its revenue information, and
not on the documentation required by the USAC directions to the Form
499, but instead, ADMA relies exclusively on an internal USAC e-mail
to FCC staff. This e-mail estimated ADMA's likely reported revenues
for 2006 based on the information USAC had at that time. Plainly,
USAC's estimate was based on incomplete data, because it did not
include ADMA's quarterly revenue for the periods during which ADMA had
not filed Form 499-Qs, and this is an inadequate basis for determining
the company's obligations. ADMA failed to provide any evidence from
its own accounts and records reflecting that the company was or
thought it was de minimis during this period. In the absence of any
persuasive evidence, we reject ADMA's assertion that it was not
required to file.
13. ADMA also contends that there has been significant confusion
surrounding de minimis carrier treatment under USF in 2005 and 2006
and cites as support a January 2007 Public Notice issued by the
Wireline Competition Bureau reminding de minimis telecommunications
providers of their FCC registration, reporting and contribution
requirements. ADMA, however, was not a de minimis carrier in 2006, and
therefore the rules that apply to such carriers are irrelevant. ADMA
also contends that the fact that such a notice was necessary bears on
the Commission's analysis of ADMA's "degree of culpability" and on the
"circumstances" of the offense. This Public Notice is irrelevant,
however, because, as ADMA acknowledges, it did not qualify for the de
minimis exemption at the time of the violation in 2006. Therefore we
affirm the ADMA NAL's finding of a violation and imposition of a
forfeiture on these grounds.
C. ADMA Is Liable For a Forfeiture For Failing to Make Universal Service
Fund
Contributions
14. In the ADMA NAL, the Commission also concluded that ADMA had
apparently violated section 254(d) of the Act and section 54.706 of
the Commission's rules by willfully and repeatedly failing to
contribute fully and timely to the universal service support
mechanisms. Specifically, the Commission found that ADMA failed to
make payments to the USF from January 2006 to October 2006 and
assessed a proposed forfeiture of $211,835.
15. In its NAL Response, ADMA contends that the proposed forfeiture
amounts for its failure to file and make USF contributions are
excessive. Specifically, ADMA argues that a forfeiture of $211,835 is
excessive when its total delinquency for its 2005 revenues was
$10,870.53. As discussed in the ADMA NAL, nonpayment of universal
service contributions is an egregious offense that bestows on
delinquent entities an unfair competitive advantage by shifting to
compliant contributors the economic costs and burdens associated with
universal service. An entity's failure to make required universal
service contributions frustrates Congress' policy objective in section
254(d) of the Act to ensure the equitable and non-discriminatory
distribution of universal service costs among all telecommunications
providers. The Commission has established a base forfeiture amount of
$10,000 for each month in which a contributor has failed to fully pay
required universal service contributions and $20,000 for each month in
which a contributor has failed to make any required universal service
contribution, plus an upward adjustment based on one-half of the
company's approximate unpaid contributions. Thus, our precedent
already considers the amount of the delinquent payment, because it is
used to make upward adjustments. The ADMA NAL followed this Commission
precedent in calculating the amount of the forfeiture for these
violations, and we find no reason to depart from that precedent here.
Thus, we affirm the ADMA NAL's application of this precedent.
16. ADMA also contends this proposed forfeiture amount was excessive
because the company did not owe any USF contributions in 2006. ADMA
argues that the number of months for which the USF was unpaid and the
amount of its USF contributions that was paid late is overstated in
the ADMA NAL, because USAC believed at the time that ADMA was
"tracking below" the de minimis threshold in 2006 and was therefore
not required to pay USF from January through October 2006. As we have
already determined above, ADMA should have filed quarterly Worksheets.
If it had done so, it would in fact have been invoiced by USAC and
required to make monthly USF contributions throughout 2006. The fact
that the company's filing violation caused USAC not to send an invoice
does not excuse ADMA's failure to pay.
17. Thus, we affirm the finding in the ADMA NAL that ADMA violated section
254(d) of the Act and section 54.706 of the Commission's rules by
willfully and repeatedly failing to contribute fully and timely to the
universal service support mechanisms. We also affirm the ADMA NAL's
proposed forfeiture of $211,835 for ADMA's failure to pay its USF
obligations.
D. ADMA Is Liable For a Forfeiture For Failing to Make TRS Contributions
18. In the ADMA NAL, the Commission found that ADMA apparently violated
section 225 of the Act and section 64.604(c)(5)(iii)(A) of the
Commission's rules by willfully and repeatedly failing to contribute
fully to the TRS Fund in 2005 and 2006. Thus, based on established
precedent, the Commission proposed a $20,000 forfeiture for ADMA's
failure to pay its TRS Fund contributions in 2005 and 2006, plus an
upward adjustment of $60,706, representing approximately one-half of
ADMA's unpaid TRS Fund contributions, for a total proposed forfeiture
of $80,706.
19. While ADMA concedes it failed to pay its required 2006 TRS fund
contribution, it contends that its failure to pay a TRS fund
contribution for 2005 occurred prior to December 8, 2005 and is beyond
the statute of limitations in this case. We reject this theory because
the violation occurred in July 2006, when payment was due. Thus, the
violation occurred within the tolled period.
20. We find that an $80,706 forfeiture is appropriate for ADMA's failure
to make TRS contributions. ADMA violated section 225 of the Act and
section 64.604(c)(5)(iii)(A) of the Commission's rules by willfully
and repeatedly failing to contribute fully to the TRS Fund. As an
interstate telecommunications carrier, ADMA was obligated to
contribute to the TRS Fund on the basis of its interstate end-user
telecommunications revenues reported on its annual Worksheet. Carriers
are required to make TRS contributions regardless of any de minimis
status. Because ADMA failed to register until August 2006, it was not
timely billed for TRS obligations in 2005 or 2006. This does not
excuse ADMA's failure to make payments due in those calendar years.
Thus, we affirm the proposed $80,706 forfeiture contained in the ADMA
NAL for the company's failure to pay its TRS Fund contributions in
2005 and 2006.
E. ADMA Is Liable For a Forfeiture For Failing To Make Timely NANP
Administration Contributions
21. In the ADMA NAL, the Commission found that ADMA has apparently
violated section 251(e)(2) of the Act and section 52.17(a) of the
Commission's rules by willfully and repeatedly failing to make timely
contributions toward the costs of number administration for 2005, 2006
and 2007. Applying the established base forfeiture amount of $10,000
for each instance in which ADMA failed to make required contributions
to the NANP administration cost recovery mechanisms, we found that
ADMA was apparently liable for the base forfeiture of $30,000 for
failing to pay its NANP contributions for 2005, 2006, and 2007.
22. ADMA concedes that it never paid its NANP contributions from the time
it began providing service in 2001 until February 1, 2007, but argues
that imposing a $10,000 forfeiture for each of three violations is
excessive because the total payment due for 2006 was $307.85 and a
$100 late fee was applied to that bill. We reject ADMA's position.
Late payment fees address administrative expenses and are not a
substitute for forfeitures. We find that failure to pay NANP
contributions for a significant period is a serious violation of our
rules that warrants a significant penalty. As noted in the ADMA NAL,
"the failure of carriers to make required NANP administration
contributions for an extended period of time severely hampers the
Commission's ability to ensure that the cost of establishing
telecommunications numbering administration arrangements is `borne by
all telecommunications carriers on a competitively neutral basis' as
Congress envisioned." Well-established precedent imposes a forfeiture
for such violation in the amount of $10,000 for each instance in which
a contributor fails to make the required contribution. ADMA has
offered no reason for us to deviate from that precedent.
23. ADMA also argues that we are prohibited from imposing a forfeiture for
its failures to pay NANP contributions in 2006 and 2007 because these
failures were not willful. ADMA states that Welch & Company, LLP, the
Commission's billing and collection agent for NANP contributions, sent
the 2006 and 2007 NANP invoices to an incorrect address instead of to
ADMA's address in Florida. As an initial matter, we note that even if
ADMA's actions were not willful, the Commission may also assess a
forfeiture for violations that are merely repeated and not willful. We
also note that a carrier is obligated to submit contributions when due
regardless of whether it receives an invoice or other notice from the
NANP administrator. As discussed in the Globcom NAL, the Act and our
rules do not condition payment on receipt of an invoice or other
notice from USAC. In addition "a carrier's failure to submit its
contributions may subject the carrier to the enforcement provisions of
the Act and other applicable law." In this case, ADMA did not submit
NANP administration contributions for 2005, 2006, or 2007. Thus, like
the USF contributions discussed in the Globcom NAL, ADMA had an
obligation to ensure it was being billed for and paying its NANP
contributions. Furthermore, there is no evidence that ADMA inquired
about the status of its NANP invoices at anytime between 2005 and
2007. As a result, ADMA deprived the NANP administration fund of funds
necessary to carry out the goals of its important statutory program.
Thus, ADMA had a responsibility to make sure that its NANP payments
were being made in a timely manner, regardless of whether it actually
received the invoices.
24. ADMA also argues that the 2005 violation is barred by the statute of
limitations because the relevant payment was due more than one year
before the Bureau and ADMA executed the tolling agreement. Since we
released the ADMA NAL, the NANP Plan Administrator cancelled all
amounts ADMA owed for 2005. According to the NANP Plan Administrator,
they do not charge a fee in the year a company registers. As a result,
ADMA was not responsible for its 2005 NANP bill. We therefore cancel
the $10,000 forfeiture amount attributed to that apparent violation.
As a result, we do not reach ADMA's argument in respect to the 2005
NANP payment violation.
25. The record is clear that ADMA failed to make any contributions toward
NANP administration cost recovery mechanisms on the basis of its
actual end-user telecommunications revenues since 2001. We conclude
that ADMA is liable for forfeiture for its failure to pay NANP
contributions in 2006 and 2007 because it provided a
telecommunications service to end users in the United States and was
required by section 52.17 of the Commission's rules to make
contributions based on it revenues derived from that service. Thus, we
find that ADMA is liable for $20,000 for failure to make timely NANP
administration contributions for 2006 and 2007.
F. ADMA Is Liable For a Forfeiture For Failing to Obtain International
Section 214
Authorization
26. In the ADMA NAL, the Commission found that ADMA has apparently
violated section 214(a) of the Act and section 63.18 of the
Commission's rules by willfully failing to apply for and obtain
authorization from the Commission to provide international
telecommunications service and, consistent with Commission precedent,
proposed a $100,000 forfeiture for this violation.
27. In its NAL Response, ADMA contends that its failure to obtain section
214 authorization is a technical violation on par with an unauthorized
pro forma transfer of control because had ADMA reorganized its
ownership and become a wholly owned subsidiary of an affiliated
company, BTS, ADMA could have provided international
telecommunications service using BTS's authorization. ADMA also
contends the Commission's Forfeiture Guidelines prescribe a $1,000
forfeiture for such a violation. We reject ADMA's argument that its
hypothetical ability to use another affiliated company's authorization
warrants a sizable reduction to the proposed forfeiture amount.
Although we permit a wholly owned subsidiary to operate under its
parent's international section 214 authorization, ADMA was not a
wholly owned subsidiary of BTS at the time the Commission granted
BTS's request for an international section 214 authorization or at the
time the Bureau investigated ADMA's noncompliance. ADMA did eventually
become a wholly-owned subsidiary of BTS in January 2007, but that
change occurred long after the investigation began. ADMA provided
unauthorized international telecommunications service for years,
deriving revenue from this service while failing to comply with
numerous regulatory obligations. The amount of the forfeiture is
consistent with precedent for entities failing to receive
international section 214 authorization prior to providing that
service. We conclude that a forfeiture of $100,000 is warranted for
ADMA's willful failure to obtain section 214 authority from the
Commission prior to providing international telecommunications
service.
IV. CONCLUSION
28. Except as otherwise noted herein, we affirm the findings contained in
the ADMA NAL. In light of the seriousness, duration and scope of the
apparent violations, we find that a forfeiture of $662,541 is
warranted, including: (1) $100,000 for ADMA's failure to register with
the Commission; (2) $150,000 for ADMA's failure to file
Telecommunications Reporting Worksheets; (3) $211,835 for ADMA's
failure to pay its USF obligations; (4) $80,706 for ADMA's failure to
make TRS contributions; (5) $20,000 for ADMA's failure to make NANP
contributions; and (6) $100,000 for ADMA's failure to obtain an
international section 214 authorization prior to commencing
international service.
V. ORDERING CLAUSES
29. Accordingly, IT IS ORDERED THAT, pursuant to section 503(b) of the
Communications Act of 1934, as amended, and section 1.80 of the
Commission's rules, ADMA Telecom, Inc. IS LIABLE FOR A MONETARY
FORFEITURE in the amount of $662,541 for willfully or repeatedly
violating the Act and the Commission's rules.
30. Payment of the forfeiture shall be made in the manner provided for in
Section 1.80 of the Rules by March 18, 2011. 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 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 in the caption to this Order. 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[s] 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.
The parties shall also send electronic notification of the date said
payment is made to pam.slipakoff@fcc.gov.
31. IT IS FURTHER ORDERED that copies of this Forfeiture Order shall be
sent by certified mail, return receipt requested, to Steven A.
Augustino, Counsel to ADMA Telecom, Inc., Kelley Drye & Warren, LLP,
Washington Harbour, Suite 400, Washington, DC 20007.
FEDERAL COMMUNICATIONS COMMISSION
Marlene H. Dortch
Secretary
47 U.S.C. S:S: 214, 225, 251(e)(2), 254.
See 47 U.S.C. S: 214; see also 47 C.F.R. S:S: 1.1157, 52.17(a), 54.706(a),
54.711(a), 63.18, 64.604(c)(5)(iii)(A)-(B), 64.1195.
See ADMA Telecom, Inc., Notice of Apparent Liability for Forfeiture, 24
FCC Rcd 838, 838-43 P:P: 2-12 (2009) ("ADMA NAL" or "NAL"). The ADMA NAL
is incorporated by reference herein.
See Response of ADMA Telecom, Inc. to the Enforcement Bureau's June 2,
2006 Letter of Inquiry, dated July 13, 2006, at 3 P: 4 ("LOI Response").
See id. at 1.
See id.
Id.
See LOI Response at 3.
See Supplemental Response of ADMA Telecom, Inc. to the Enforcement
Bureau's June 2, 2006 Letter of Inquiry, dated August 1, 2006, at 10
("Supplemental LOI Response").
See Letter from Steven A. Augustino, Counsel to ADMA Telecom, Inc. to
Hillary S. DeNigro, Chief, Investigations and Hearings Division, Federal
Communications Commission (dated February 13, 2009) ("NAL Response").
See id. at 1.
Id.
See id. at 3-4 and Exhibit 2.
See id. at 4-5.
47 U.S.C. S: 503(b)(1)(B); 47 C.F.R. S: 1.80, 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),
reconsideration denied, 15 FCC Rcd 303 (1999) ("Forfeiture Policy
Statement").
47 U.S.C. S: 503(b)(2)(E).
47 U.S.C. S: 312(f)(1).
H.R. Rep. No. 97-765, 97th Cong. 2d Sess. 51 (1982) ("This provision
[inserted in section 312] defines the terms `willful' and `repeated' for
purposes of section 312, and for any other relevant section of the act
(e.g., section 503).... As defined ... `willful' means that the licensee
knew that he was doing the act in question, regardless of whether there
was an intent to violate the law. `Repeated' means more than once, or
where the act is continuous, for more than one day. Whether an act is
considered to be `continuous' would depend upon the circumstances in each
case. The definitions are intended primarily to clarify the language in
sections 312 and 503, and are consistent with the Commission's application
of those terms ...").
See, e.g., Application for Review of Southern California Broadcasting Co.,
Memorandum Opinion and Order, 6 FCC Rcd 4387, 4388 (1991) ("Southern
California Broadcasting Co.").
See, e.g., Callais Cablevision, Inc., Notice of Apparent Liability for
Monetary Forfeiture, 16 FCC Rcd 1359, 1362 P: 10 (2001) ("Callais
Cablevision, Inc.") (proposing a forfeiture for, inter alia, a cable
television operator's repeated signal leakage).
Southern California Broadcasting Co., 6 FCC Rcd at 4388, P: 5; Callais
Cablevision, Inc., 16 FCC Rcd at 1362, P: 9.
See 47 U.S.C. S:S: 214, 225, 251(e)(2), 254; 47 C.F.R. S:S: 1.1157,
52.17(a), 54.706(a), 54.711(a), 63.18, 64.604(c)(5)(iii)(A)-(B), 64.1195.
See ADMA NAL, 24 FCC Rcd at 845-46 P:P: 13-15, 851 P:P: 29-30.
See 47 U.S.C. S: 503(b)(6)(B).
NAL Response at 4-5.
Global Teldata II, LLC, Order of Forfeiture, 22 RCC Rcd 8710, 8716-8717
P:P: 16-17 (2007) (Global Teldata Forfeiture Order) (The Commission
concluded that Global Teldata's failure to register pursuant to 47 C.F.R.
S: 64.1195(a) was a continuing violation.) See also Teletronics, Inc.,
Notice of Apparent Liability of Forfeiture and Order, 20 FCC Rcd 13291,
13292 P: 5 (2005) ("Teletronics NAL") (holding same), consent decree
entered, 22 FCC Rcd 8681 (2007); InPhonic, Inc., Notice of Apparent
Liability of Forfeiture and Order, 20 FCC Rcd 13277, 13282-83 P:P: 14-16
(2005) ("InPhonic NAL") (holding same); InPhonic, Inc., Order of
Forfeiture and Further Notice of Apparent Liability for Forfeiture, 22 FCC
Rcd 8689 (2007) ("InPhonic Forfeiture Order") (holding same).
See 47 U.S.C. S: 503(b)(2)(B) (authorizing the Commission to assess a
forfeiture for "each violation or each day of a continuing violation. . .
."(emphasis added)).
47 C.F.R. S:S: 64.1195(a); ADMA NAL, 24 FCC Rcd at 851 P:P: 29-30 (The
Commission concluded that a proposed forfeiture of $100,000 was warranted
for ADMA's failure to register); Telecom House, Inc., Notice of Apparent
Liability for Forfeiture and Order, 21 FCC Rcd 13655, 13661-62, 13666 P:P:
17-19, 29 (2007) ("Telecom House NAL") (The Commission concluded that a
proposed forfeiture of $100,000 was warranted for Telecom House's failure
to register), consent decree entered, 21 FCC Rcd 10883 (2006);
Communications Services Integrated, Inc., Notice of Apparent Liability for
Forfeiture and Order, 20 FCC Rcd 17251, 17256-57, 17260 P:P: 14-16, 24
(2005) ("CSII NAL") (The Commission concluded that a proposed forfeiture
of $100,000 was warranted for CSII's failure to register.), consent decree
entered, 21 FCC Rcd 10462 (2006).
47 C.F.R. S:S: 54.711(a), 64.604(c)(5)(iii)(B).
See ADMA NAL, 24 FCC Rcd at 846-47 P:P: 16-18.
Id. at 851-52 P: 31.
Id.
See NAL Response at 7.
ADMA NAL, 24 FCC Rcd at 846-47 P: 17; Local Phone Service, Inc., Notice of
Apparent Liability for Forfeiture, 21 FCC Rcd 9974, 9977-78 P:P: 9-11
(2206) ("LPSI NAL").
Local Phone Service, Inc., Forfeiture Order, 23 FCC Rcd 8952, 8956 P: 11
(2008) ("LPSI Forfeiture Order") (imposing $50,000 forfeiture for each
late filed worksheet); Carrera Communications, LP, Notice of Apparent
Liability for Forfeiture and Order, 20 FCC Rcd 13307, 13312-13 P:P: 14-15
(2005) ("Carrera NAL") (imposing $50,000 forfeiture for each failure to
timely file a reporting worksheet for a total of $250,000 for five
worksheets); modified by Carrera Communications, LP, Order of Forfeiture,
22 FCC Rcd 9585, 9590 P:P: 11-12 (2007) (reducing forfeiture amount based
on ability to pay); InPhonic NAL, 20 FCC Rcd at 13287 P: 27 (proposing
$50,000 forfeiture for each failure to timely file a reporting worksheet
for a total $100,000 for two worksheets), aff'd by InPhonic Forfeiture
Order, 22 FCC Rcd 8689 (2007); Telecom House NAL, 21 FCC Rcd at 13666 P:
30 (proposing $50,000 forfeiture for each failure to timely file a
reporting worksheet for a total of $150,000 for three worksheets); Global
Teledata II, LLC, Notice of Apparent Liability for Forfeiture and Order,
20 FCC Rcd 17264, 17274-75 P: 25 (2005) ("Global Teledata NAL") (proposing
$50,000 forfeiture for failure to timely file a reporting worksheet); CSII
NAL, 20 FCC Rcd at 17260 P: 25 (proposing $50,000 forfeiture for each
failure to timely file a reporting worksheet for a total of $150,000 for
three worksheets).
As noted in the ADMA NAL, pursuant to section 503(b)(6) of the Act, the
Commission only proposed forfeitures for apparent violations that occurred
within one year of the date of the NAL. Therefore, although we found that
ADMA apparently violated the Act and our rules for five years, we propose
forfeitures only for violations that occurred within the parameters of the
tolling agreement. See, e.g., Globcom, Inc. Notice of Apparent Liability
for Forfeiture and Order, 18 FCC Rcd 19893, 19903 (2003) ("Globcom NAL");
Roadrunner Transp., Inc., Forfeiture Order, 15 FCC Rcd 9669, 9671 (2000);
Liab. of E. Broad. Corp., Memorandum Opinion and Order, 10 F.C.C. 2d 37
(1967), Teletronics NAL, 20 FCC Rcd at 13298-99 P:P: 20-22.
NAL Response at 2-3.
47 C.F.R. S: 54.708.
See 47 C.F.R. S: 54.708; Telecommunications Reporting Worksheet, FCC
Revised Form 499-A (2006), Instructions for Completing the Worksheet for
Filing Contributions to Telecommunications Relay Service, Universal
Service, Number Administration, and Local Number Portability Support
Mechanisms at 5, http://www.fcc.gov/Forms/Form499-A/499a-2006.pdf ("2006
Telecommunications Reporting Worksheet Instructions"); Wireline
Competition Bureau Reminds De Minimis Telecommunication Providers of
Certain FCC Regulation, Reporting, and Contribution Requirements, Public
Notice, 22 FCC Rcd 1889, 1890-91 (Wireline Comp. Bur. 2007) (WCB Public
Notice).
See 2006 Telecommunications Reporting Worksheet Instructions at 6.
NAL Response at 3.
See NAL Response at 6.
See id.; WCB Public Notice, 22 FCC Rcd at 1889.
NAL Response at 6.
See 47 U.S.C. S: 254(d); 47 C.F.R. S: 54.706(c); ADMA NAL, 24 FCC Rcd at
847-48 P:P: 19-20.
See ADMA NAL, 24 FCC Rcd at 852-53 P:P: 32-35.
See NAL Response at 7.
See ADMA NAL, 24 FCC Rcd at 852 P: 32; 47 U.S.C. S: 254(d).
See, e.g., See Globalcom, Inc., 25 FCC Rcd 3479, 13485 P:16 (2010)
(Globalcom NAL); NTS NAL, 25 FCC Rcd 5137, 5142 P:P: 12-13 (2010) ("NTS
NAL"); LPSI NAL, 21 FCC Rcd at 9980 P:P: 15-16; Telrite Corp., Notice of
Apparent Liability for Forfeiture and Order, 23 FCC Rcd 7231, 7242-44 P:P:
25-28 (2008) ("Telrite NAL"); Compass Global, Inc., Notice of Apparent
Liability for Forfeiture, 23 FCC Rcd 6125, 6138-40 P: 31-34 (2008)
("Compass Global NAL"); Global Crossing North America, Inc. et al., Notice
of Apparent Liability for Forfeiture, 23 FCC Rcd, 6120 P: 21 (2008)
("Global Crossing NAL"); OCMC, Inc., Order of Forfeiture, 21 FCC Rcd
10479, 10482 P: 10 (2006) ("OCMC Forfeiture Order"); Globcom NAL, 18 FCC
Rcd at 19903-04 P:P: 25-27; Globcom, Inc., Order of Forfeiture, 21 FCC Rcd
4710, 4721-24 P: 31-38 (2006)("Globcom Forfeiture Order"). For similar
reasons, we also apply an upward adjustment for TRS payments based on half
of a company's unpaid contributions. Globcom NAL, 18 FCC Rcd at 19903-04
P:P: 25-27.
NAL Response at 7.
Id. at 2-3.
See supra P:P: 11-13.
See ADMA NAL, 24 FCC Rcd at 848 P:P: 21-22; 47 U.S.C. S: 225; 47 C.F.R. S:
64.604(c)(5)(iii)(A).
See ADMA NAL, 24 FCC Rcd at 853 P: 35.
NAL Response at 4-5.
Moreover, as discussed in the ADMA NAL and consistent with Commission
precedent, failure to pay USF contributions and other similar payment
obligations are continuing violations. See ADMA NAL, 24 FCC Rcd at 852 P:
32, citing Global Crossing NAL, 23 FCC Rcd 6110 P:P: 21-24 (proposing
$10,518,013 forfeiture for continuing failure to make required USF
contributions); Omniat International Telecom, LLC d/b/a OMNIAT Telecom, 24
FCC Rcd 4252, 4265 P: 27 (2009) (proposing $10,518,013 forfeiture for
continuing failure to make required USF contributions) ("Omniat NAL");
Telrite NAL, 23 FCC Rcd 7231 (proposing $40,000 forfeiture for continuing
failure to satisfy its TRS obligations for the 2005-2008 funding
periods.); Compass Global NAL, 23 FCC Rcd 6125 (proposing $828,613.44
forfeiture for continuing failure to make required USF contributions). To
the extent ADMA believes its failure to satisfy its TRS obligations arises
in 2005, that failure was a continuing violation that began in July 2006
and continued until the company paid its entire the delinquent balance due
to the TRS. ADMA had not fully paid its TRS obligations at the time the
ADMA NAL was issued. ADMA had made payments totaling only $79,020,
approximately 65% of what it owed to the TRS. ADMA NAL, 24 FCC Rcd at 848
P: 22. Thus the violation was continuing at the time the ADMA NAL was
issued and the forfeiture is also not time barred on that basis.
47 U.S.C. S: 225; 47 C.F.R. S: 64.604(c)(5)(iii)(A).
Id.; 47 C.F.R. S: 64.604(c)(5)(iii)(B) (setting forth methods of
computation and payment of contributions to TRS Fund).
WCB Public Notice, 22 FCC Rcd at 1892.
The billing cycle for TRS assessments runs from July 1 to June 30 of each
year, with assessments made based on carriers' reported revenues
information for the corresponding FCC Form 499-A.
See ADMA NAL, 24 FCC Rcd at 849 P:P: 23-24; 47 U.S.C. S: 251(e)(2); 47
C.F.R. S: 52.17(a).
See ADMA NAL, 24 FCC Rcd at 853 P: 36.
NAL Response at 7-8.
ADMA NAL, 24 FCC Rcd at 853 P: 36.
Id., citing Teletronics NAL, 20 FCC Rcd at 13303 P: 35. See also, Omniat
NAL, 24 FCC Rcd at 4265-66 P: 28; Telrite NAL, 23 FCC Rcd 7231, 7245-46 P:
33; Compass Global NAL, 23 FCC Rcd 6125, 6141-42 P: 38.
See NAL Response at 3-4
See Supra n.20.
See 47 C.F.R. S: 54.711(a) ("The Commission shall announce by Public
Notice published in the Federal Register and on its website the manner of
payment and the dates by which payments must be made."). E.g., "Proposed
Third Quarter 2003 Contribution Factor," Public Notice, 18 FCC Rcd 11442
(Wireline Comp. Bur. 2003) ("Contribution payments are due on the date
shown on the [USAC] invoice.")
See 47 U.S.C. S: 254(d); 47 C.F.R. S: 54.706(b). Cf. Globcom NAL, 18 FCC
Rcd at 19896, n.22 (explaining that a carrier that does not file may fail
to receive an invoice from USAC, but is nonetheless required to contribute
to the USF, unless its revenues are considered de minimis). See also 2006
Telecommunications Reporting Worksheet Instructions.
See Globcom NAL, 18 FCC Rcd at 19896 P: 5.
NAL Response at 5.
See NANPA credit note CN002504.
See ADMA NAL, 24 FCC Rcd at 849-50 P:P: 25-27; 47 U.S.C. S: 214(a); 47
C.F.R. S: 63.18.
NAL Response at 7.
See 47 C.F.R. S: 63.21(h). A company can provide international service
pursuant to another company's international section 214 authorization if
the former is a wholly-owned subsidiary.
InPhonic NAL, 22 FCC Rcd at 8706 P: 41 (proposing a forfeiture of $100,000
for InPhonic's apparent operation as an international telecommunications
service provider without section 214 authorization); Omniat NAL, 24 FCC
Rcd at 4264 P: 25 (proposing a forfeiture of $100,000 for Omniat's
apparent operation as an international telecommunications service provider
without section 214 authorization); Teleplus, LLC, Notice of Apparent
Liability for Forfeiture, 24 FCC Rcd 7666, 7670-71 P: 12 (Enf. Bur. 2009)
(proposing a forfeiture of $100,000 for Teleplus' apparent operation as an
international telecommunications service provider without section 214
authorization).
See ADMA NAL, 24 FCC Rcd at 854 P: 38.
47 U.S.C. S: 503(b).
47 C.F.R. S: 1.80.
47 U.S.C. S: 504(a).
Continued...
Federal Communications Commission FCC 11-42
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Federal Communications Commission FCC 11-42