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Before the
Federal Communications Commission
Washington, D.C. 20554
)
)
) File No.: EB-07-TC-4006
In the Matter of
) NAL /Acct. No.: 200832170013
Horizon Telecom, Inc.
) FRN: 0009704925
and
) File No.: EB-08-TC-1067
Reduced Rate Long Distance, LLC
) NAL /Acct. No.: 200832170026
Apparent Liability for Forfeiture FRN: 0005003025
)
)
)
ADOPTING ORDER
Adopted: March 30, 2012 Released: April 5, 2012
By the Chief, Enforcement Bureau:
1. In this Order, we adopt the attached Consent Decree entered into
between the Enforcement Bureau (Bureau) of the Federal Communications
Commission (Commission) and Horizon Telecom, Inc. (Horizon) and
Reduced Rate Long Distance, LLC (Reduced Rate Long Distance). The
Consent Decree terminates the investigation initiated by the Bureau
regarding Horizon's compliance with Sections 201(b) and 258 of the
Communications Act of 1934, as amended (Act), and Sections 1.717,
64.1120, and 64.1130 of the Commission's rules, and finds that the
forfeiture proposed in the Notice of Apparent Liability for Forfeiture
should not be imposed. The Consent Decree also terminates the
investigation initiated by the Bureau regarding Reduced Rate Long
Distance's compliance with Section 1.717 of the Commission's rules,
and finds that the forfeiture proposed in the Notice of Apparent
Liability for Forfeiture should not be imposed.
2. The Bureau and Horizon and Reduced Rate Long Distance have negotiated
the terms of a Consent Decree that resolves these matters. A copy of
the Consent Decree is attached hereto and incorporated by reference.
3. After reviewing the terms of the Consent Decree and evaluating the
facts before us, we find that the public interest would be served by
adopting the Consent Decree and terminating the referenced
investigations.
4. In the absence of material new evidence relating to this matter, we
conclude that our investigations raise no substantial or material
questions of fact as to whether Reduced Rate Long Distance possesses
the basic qualifications, including those related to character, to
hold or obtain any Commission license or authorization.
5. Accordingly, IT IS ORDERED, pursuant to Section 4(i) of the
Communications Act of 1934, as amended and the authority delegated by
Sections 0.111 and 0.311 of the Commission's rules, that the attached
Consent Decree IS ADOPTED.
6. IT IS FURTHER ORDERED that the above-captioned investigations ARE
TERMINATED.
7. IT IS FURTHER ORDERED that a copy of this Order and Consent Decree
shall be sent by first class mail and certified mail, return receipt
requested, to Thomas K. Crowe, Partner, Law Offices of Thomas K.
Crowe, P.C., 1250 24th Street, N.W., Suite 300, Washington, D.C.
20037.
FEDERAL COMMUNICATIONS COMMISSION
P. Michele Ellison
Chief, Enforcement Bureau
Before the
Federal Communications Commission
Washington, D.C. 20554
)
)
) File No.: EB-07-TC-4006
In the Matter of
) NAL /Acct. No.: 200832170013
Horizon Telecom, Inc.
) FRN: 0009704925
and
) File No.: EB-08-TC-1067
Reduced Rate Long Distance, LLC
) NAL /Acct. No.: 200832170026
Apparent Liability for Forfeiture FRN: 0005003025
)
)
)
CONSENT DECREE
I. INTRODUCTION
1. The Enforcement Bureau of the Federal Communications Commission and
Horizon Telecom, Inc. and Reduced Rate Long Distance, LLC, by their
authorized representatives, hereby enter into this Consent Decree for
the purpose of terminating the investigations initiated by the Bureau
into whether Horizon Telecom, Inc. violated Sections 201(b) and 258 of
the Communications Act of 1934, as amended, and Sections 1.717,
64.1120, and 64.1130 of the Commission's rules, and whether Reduced
Rate Long Distance, LLC violated Section 1.717 of the Commission's
rules. In addition to terminating the investigations, the Consent
Decree finds that the forfeitures proposed in the related Notices of
Apparent Liability for Forfeiture should not be imposed.
III. DEFINITIONS
2. For purposes of this Consent Decree, the following definitions shall
apply:
a. "Act" means the Communications Act of 1934, as amended, 47 U.S.C. S:
151 et seq.
b. "Adopting Order" or "Order" means an order of the Bureau adopting the
terms and conditions of this Consent Decree without change, addition,
or modification, and formally terminating the above-captioned
Investigations.
c. "Affiliate" shall have the same meaning as that term is defined in
Section 153(1) of the Communications Act. 47 U.S.C. S: 153(1).
d. "Bureau" means the Enforcement Bureau of the Federal Communications
Commission.
e. "Commission" or "FCC" means the Federal Communications Commission and
all of its bureaus and offices.
f. "Effective Date" means the date on which the Bureau releases the
Adopting Order.
g. "Horizon" means Horizon Telecom, Inc., its affiliates, and its
predecessors-in-interest and successors-in-interest.
h. "Horizon Obligations" means the requirements described in this
Consent Decree at paragraph 12.
i. "Horizon Investigation" means the Bureau's investigation regarding
Horizon's compliance with Sections 201(b) and 258 of the Act, 47
U.S.C. S:S: 201(b), 258, and Sections 1.717, 64.1120, and 64.1130 of
the Commission's rules, 47 C.F.R. S:S: 1.717, 64.1120, 64.1130,
commenced by the Bureau's June 28, 2007 letter of inquiry to Horizon,
described in paragraph 5 below.
j. "Investigations" means, collectively, the Horizon Investigation and
the Reduced Rate Long Distance Investigation.
k. "Parties" means Horizon, Reduced Rate Long Distance, and the Bureau,
each of which is a "Party."
l. "Rules" means those rules and regulations codified in Title 47 of the
Code of Federal Regulations.
m. "Reduced Rate Long Distance" means Reduced Rate Long Distance, LLC,
its affiliates, and its predecessors-in-interest and
successors-in-interest.
n. "Reduced Rate Long Distance Compliance Plan" means the program
described in this Consent Decree at paragraph 13.
o. "Reduced Rate Long Distance Investigation" means the Bureau's
investigation regarding Reduced Rate Long Distance's compliance with
Section 1.717 of the Commission's rules, 47 C.F.R. S: 1.717,
commenced by the Bureau's January 24, 2008 letter of inquiry to
Reduced Rate Long Distance, described in paragraph 6 below.
p. "Slamming Rules" means the Rules set forth at 47 C.F.R. S: 64.1120 et
seq.
II. BACKGROUND
3. In December 1998, the Commission released the Section 258 Order in
which it adopted rules to implement Section 258 of the Act. Section 258
makes it unlawful for any telecommunications carrier to "submit or execute
a change in a subscriber's selection of a provider of telephone exchange
service or telephone toll service except in accordance with such
verification procedures as the Commission shall prescribe." In the Section
258 Order, the Commission adopted aggressive new rules designed to take
the profit out of slamming, broadened the scope of the slamming rules to
encompass all carriers, and modified its existing requirements for the
authorization and verification of preferred carrier changes. The rules
require, among other things, that a carrier receive individual subscriber
consent before a carrier change may occur. Pursuant to Section 258,
carriers are absolutely barred from changing a customer's preferred local
or long distance carrier without first complying with one of the
Commission's verification procedures. Specifically, a carrier must: (1)
obtain the subscriber's written or electronically signed authorization in
a format that meets the requirements of Section 64.1130; (2) obtain
confirmation from the subscriber via a toll-free number provided
exclusively for the purpose of confirming orders electronically; or (3)
utilize an independent third party to verify the subscriber's order.
4. Horizon was a provider of telecommunications services that primarily
used the internet to market its products to residential customers from
approximately February 2006 through April 2007. Horizon also engaged in a
telemarketing program that was suspended in May 2007. On December 1, 2007,
Horizon and Reduced Rate Long Distance entered into a management
agreement, whereby Reduced Rate Long Distance agreed to manage the
business of Horizon. The companies also contemporaneously entered into an
asset purchase agreement, whereby Horizon's telecommunications assets,
including its customer base, would be transferred to Reduced Rate Long
Distance. The transfer was consummated on January 23, 2009. The companies
state that all affected customers have been notified pursuant to Section
64.1120(e)(3) of the Commission's rules.
Horizon NAL
5. The Bureau sent a letter of inquiry (LOI) to Horizon on June 28, 2007.
Horizon provided a Response to the LOI on July 27, 2007 and supplemented
its Response on September 19, 2007 and October 5, 2007. On February 29,
2008, the Commission released an NAL against Horizon for its apparent
willful and repeated failure to respond on a timely basis to twenty-one
informal complaints that had been served upon it by the Commission's
Consumer and Governmental Affairs Bureau (CGB), and for apparently
changing the preferred carriers of one hundred twenty-five consumers
without proper authorization. On March 31, 2008, Horizon filed its
response to the NAL.
Reduced Rate Long Distance NAL
6. The Bureau sent an LOI to Reduced Rate Long Distance on January 24,
2008. Reduced Rate Long Distance submitted its responses on March 3, 2008
and March 12, 2008. On February 19, 2008, the Bureau released an NAL
against Reduced Rate Long Distance for its failure to respond to two
informal consumer complaints served upon it by CGB in apparent violation
of Section 1.717 of the Commission's rules. On March 20, 2008, Reduced
Rate Long Distance filed its response to the NAL.
IV. TERMS OF AGREEMENT
7. Adopting Order. The Parties agree that the provisions of this Consent
Decree shall be subject to final approval by the Bureau by incorporation
of such provisions by reference in the Adopting Order without change,
addition, modification, or deletion. Horizon's and Reduced Rate Long
Distance's decisions to enter into this Consent Decree are expressly
contingent upon the Bureau's issuance of an Adopting Order.
8. Jurisdiction. Horizon and Reduced Rate Long Distance agree that the
Bureau has jurisdiction over them and the matters contained in this
Consent Decree and has the authority to enter into and adopt this Consent
Decree.
9. Effective Date; Violations. The Parties agree that this Consent Decree
shall become effective on the Effective Date. Upon the Effective Date, the
Adopting Order and this Consent Decree shall have the same force and
effect as any other order of the Commission. Any violation of the Adopting
Order or of the terms of this Consent Decree shall constitute a separate
violation of a Commission order, entitling the Commission to exercise any
rights and remedies attendant to the enforcement of a Commission order.
10. Termination of Investigation. In express reliance on the covenants and
representations contained herein, and to avoid expenditure of additional
public resources, the Bureau agrees to terminate the Investigations. In
consideration for the termination of said Investigations and in accordance
with the terms of this Consent Decree, Horizon and Reduced Rate Long
Distance agree to the terms, conditions, and procedures contained herein.
The Bureau agrees that, in the absence of new material evidence related to
the Investigations, it will not use the facts developed in the
Investigations through the Effective Date, or the existence of this
Consent Decree to institute, on its own motion, or refer to the
Commission, any new proceeding, formal or informal, or take, on its own
motion, or refer to the Commission, any action against Horizon or Reduced
Rate Long Distance, concerning the matters that were the subject of the
Investigations, or with respect to Reduced Rate Long Distance's basic
qualifications, including its character qualifications, to be a Commission
licensee or hold other Commission authorizations.
11. Section 208 Complaints; Subsequent Investigations. Nothing in this
Consent Decree shall prevent the Commission or its delegated authority
from adjudicating complaints filed pursuant to Section 208 of the Act
against Horizon or Reduced Rate Long Distance for alleged violations of
the Act, or for any other type of alleged misconduct, regardless of when
such misconduct took place. The Commission's adjudication of any such
complaint will be based solely on the record developed in that proceeding.
Except as expressly provided in this Consent Decree, this Consent Decree
shall not prevent the Commission from investigating new evidence of
noncompliance by Horizon or Reduced Rate Long Distance with the Act, the
Rules, or the Adopting Order.
12. Horizon Obligations. To resolve and terminate the Horizon
Investigation, Horizon agrees to certain obligations consistent with this
paragraph 12.
A. No Marketing or Sales of Telecommunications Services. Irrespective of
other terms that may be set forth in this Consent Decree, Horizon shall
not, at any time, market or sell, or resume marketing or sales of,
telecommunications services.
B. Discontinuance of Service. Horizon represents that it has transferred
its telecommunications assets, including its customer base, to Reduced
Rate Long Distance and permanently discontinued all interstate,
international, and intrastate long distance services as of April 2007.
Irrespective of other terms that may be set forth in this Consent Decree,
Horizon shall not, at any time, resume the provision of telecommunications
services in the future.
C. Notice of Consent Decree. Within sixty (60) calendar days after the
Effective Date, Horizon shall notify all of its directors, officers,
managers, employees, and agents, including all sales representatives and
Third Party Verification firms utilized by Horizon, of the terms and
conditions set forth in this Consent Decree.
D. Reporting Non-Compliance. Horizon shall report any non-compliance with
this Consent Decree to the Enforcement Bureau within thirty (30) calendar
days after the discovery of non-compliance. Such reports shall include a
detailed explanation of (i) each instance of non-compliance; (ii) the
steps that Horizon has taken or will take to remedy such non-compliance;
(iii) the schedule on which such remedial actions will be taken; and (iv)
the steps that Horizon has taken or will take to prevent the recurrence of
any such non-compliance. All reports of non-compliance shall be submitted
to the Chief, Telecommunications Consumers Division, Enforcement Bureau,
Federal Communications Commission, 445 12th Street S.W., Washington, D.C.
20554, with a copy submitted electronically to donna.cyrus@fcc.gov and
kimberly.wild@fcc.gov.
13. Reduced Rate Long Distance Compliance Plan. To resolve and terminate
the Reduced Rate Long Distance Investigation, Reduced Rate Long Distance
agrees to implement a Compliance Plan consistent with this paragraph 13.
A. Compliance Officer. Within thirty (30) calendar days after the
Effective Date, Reduced Rate Long Distance shall designate a Compliance
Officer responsible for administering Reduced Rate Long Distance's
Compliance Plan. The Compliance Officer shall ensure compliance with this
Consent Decree and the Slamming Rules.
B. Consumer Remedies. Reduced Rate Long Distance shall take the necessary
steps to address any and all consumer complaints regarding an alleged
unauthorized switch of service provider by:
i. having all such complaints addressed by appropriately-trained customer
service representatives; and
ii. acting in good faith to resolve all such complaints during the first
call; and where it is necessary to call the customer back or leave a
message, striving to resolve the complaint in the same business day and at
the latest within twenty-four (24) hours, excluding weekends and federal
holidays; and
iii. providing all appropriate remedies, including credits and refunds, if
necessary; and
iv. implementing improvements to its customer service program, including
upgrading its complaint logging database to allow timely responses to
informal complaints served by the FCC.
C. Revised Sales Scripts, Third Party Verification Scripts, and Letters of
Authorization. Reduced Rate Long Distance shall revise its sales scripts,
third party verification scripts, and any other marketing or verification
scripts, including written or electronic Letters of Authorization to
ensure compliance with the Rules.
D. Customer Service Record Retention.
i. In addition to the Third Party Verification retention requirements set
forth in Section 64.1120(a)(1)(ii) of the Commission's rules, Reduced Rate
Long Distance shall retain records of all consumer complaints and customer
service responses, including consumer credits, for the term of this
Consent Decree. The records shall be maintained in an accurate and
easy-to-review format. These records shall be made available to the Bureau
for inspection within twenty (20) business days from receipt of a Bureau
request.
ii. Consumer complaint records shall include all written consumer
complaints filed directly with Reduced Rate Long Distance by consumers or
submitted to Reduced Rate Long Distance by the Commission or other state
or federal authority.
iii. The record of consumer complaints shall include the name, address,
and telephone number of each complainant, Reduced Rate Long Distance's
response, and the status or final disposition of each complaint. For the
purposes of this provision, consumer complaint records shall include all
non-privileged writings, computer records, electronic, or email
communications, all written notes regarding such writings, verbal
discussions, and electronic mail communications.
E. Sales Training Materials.
i. Reduced Rate Long Distance shall implement a new Policy Manual (Manual)
within thirty (30) calendar days after the Effective Date. The Manual will
prohibit any activity that violates any federal or state law,
misrepresents the sales caller's identity or purpose, or involves any
other misleading, untrue, or incomplete statements. The Manual shall
impose a "zero tolerance" policy for acts of misrepresentation for which
Reduced Rate Long Distance may immediately terminate its relationship with
any employee, affiliate, agent, contractor, or any other individual or
entity acting on behalf of, or for the benefit of, Reduced Rate Long
Distance. All such sales and marketing individuals or entities shall be
provided with a copy of the Manual, and be required to review the Manual,
and an explanation of the provisions in the Manual shall be a part of
their initial training.
ii. The activity prohibited by the Manual shall include, but will not be
limited to:
a. any activity that violates any federal or state law or results in
violation of any regulation enacted by any federal or state governmental
body including the FCC or any state public utilities commission. Any
activity that would constitute a violation of federal or state slamming or
cramming laws is strictly prohibited; and
b. any act of misrepresentation or fraud made in relation to Reduced Rate
Long Distance's services, rates, surcharges, terms, and conditions. This
may include, but is not limited to, the following:
1) claiming that a sales call is for a purpose other than to sell Reduced
Rate Long Distance's long distance services;
2) claiming that a sales call is only for the purpose of verifying or
confirming the consumer's current services;
3) falsely claiming that the call will not result in a change of the
consumer's long distance carrier;
4) claiming to be affiliated with or working for any telecommunications
carrier or any other company other than Reduced Rate Long Distance;
5) claiming that another carrier (or the consumer's current carrier)
cannot make or complete certain long distance calls;
6) failing to adequately identify the marketing representative or Reduced
Rate Long Distance on a sales call;
7) making any false, untrue, misleading, or incomplete statements;
8) any conduct which generally violates standard industry ethical
practices.
F. Sales and Marketing Contracts. Reduced Rate Long Distance shall require
contracts from all sales and marketing companies it employs obligating
them to abide by all applicable federal, state, and local laws and
regulations, including the Act. Said contracts shall allow Reduced Rate
Long Distance, in its sole discretion, to terminate any contract upon
suspicion of illegal or unethical conduct.
G. Counsel Review. Prior to distributing the new Policy Manual and the new
sales scripts, TPV scripts, and other marketing or verification scripts
described herein, Reduced Rate Long Distance shall submit the same to
legal counsel of its own designation for review and editing regarding
conformity with the requirements of this Compliance Plan and all
applicable federal and state laws. Such counsel shall have experience with
federal telecommunications and consumer protection laws, including the law
relating to fraudulent, deceptive, unconscionable, and unfair acts or
practices.
H. Notice of Consent Decree. Within sixty (60) calendar days after the
Effective Date, Reduced Rate Long Distance shall notify all directors,
officers, managers, employees and agents, including all sales
representatives and Third Party Verification firms utilized by Reduced
Rate Long Distance, of the terms and conditions set forth therein.
I. Reporting Non-Compliance. Reduced Rate Long Distance shall report any
non-compliance with this Consent Decree, or with the Slamming Rules, to
the Bureau within thirty (30) calendar days after the discovery of
non-compliance. Such reports shall include a detailed explanation of (i)
each instance of non-compliance; (ii) the steps that Reduced Rate Long
Distance has taken or will take to remedy such non-compliance; (iii) the
schedule on which such remedial actions will be taken; and (iv) the steps
that Reduced Rate Long Distance has taken or will take to prevent the
recurrence of any such non-compliance. All reports of non-compliance shall
be submitted to the Chief, Telecommunications Consumers Division,
Enforcement Bureau, Federal Communications Commission, 445 12th Street
S.W., Washington, D.C. 20554, with a copy submitted electronically to
donna.cyrus@fcc.gov.
J. Compliance Report. The Compliance Officer, as an agent of and on behalf
of Reduced Rate Long Distance, shall file compliance reports ninety (90)
calendar days after the Effective Date, one (1) year after the Effective
Date, and at the end of the two (2) year term, in compliance with the
terms of this paragraph 13(J).
i. Each compliance report shall include a detailed description of Reduced
Rate Long Distance's efforts during the relevant period to comply with the
terms and conditions of this Consent Decree and the Commission's Slamming
Rules.
ii. Each compliance report shall include a certification by the Compliance
Officer, as an agent of and on behalf of Reduced Rate Long Distance,
stating that the Compliance Officer has personal knowledge that Reduced
Rate Long Distance (A) has established and implemented the Compliance
Plan; (B) has been following all aspects of the Compliance Plan for the
entire term of the Consent Decree; and (C) is not aware of any instances
of non-compliance with the terms and conditions of this Consent Decree
that have not been disclosed as required by paragraph 13(I) above. The
certification shall be accompanied by a statement explaining the basis for
the Compliance Officer's certification and must be substantially in the
form set forth in Section 1.16 of the Rules.
iii. If the Compliance Officer cannot provide the requisite certification,
the Compliance Officer, as an agent of and on behalf of Reduced Rate Long
Distance, shall provide the Commission with a detailed explanation of (A)
each instance of non-compliance; (B) the steps that Reduced Rate Long
Distance has taken or will take to remedy such non-compliance, including
the schedule on which proposed remedial actions will be taken; and (C) the
steps that Reduced Rate Long Distance has taken or will take to prevent
recurrence of any such non-compliance, including the schedule on which
such preventive action will be taken.
iv. Such certification must be mailed within fifteen (15) calendar days of
the one (1) and the two (2) year anniversary of the Effective Date, and
Reduced Rate Long Distance must mail the certification to the Chief,
Telecommunications Consumers Division, Enforcement Bureau, Federal
Communications Commission, 445 12th Street, S.W., Washington, D.C. 20554,
and must include the file number listed above. Reduced Rate Long Distance
shall also send an electronic copy of its certification to
kimberly.wild@fcc.gov and donna.cyrus@fcc.gov.
K. Duration of the Compliance Plan. Reduced Rate Long Distance shall
implement the Reduced Rate Long Distance Compliance Plan within sixty (60)
calendar days after the Effective Date. The term of the Reduced Rate Long
Distance Compliance Plan shall expire two (2) years after the Effective
Date.
14. Voluntary Contribution. In consideration for the termination of the
Investigations in accordance with the terms of this Consent Decree,
Horizon and Reduced Rate Long Distance agree to make a voluntary
contribution to the United States Treasury, without further protest or
recourse to a trial de novo, in the amount of fifty-three thousand dollars
($53,000) within thirty (30) calendar days after the Effective Date.
Horizon and Reduced Rate Long Distance agree that they are jointly and
severally liable for the payment, which is reduced from the proposed NAL
amounts based upon their demonstrated inability to pay. The payment must
be made by check or similar instrument, payable to the Order of the
Federal Communications Commission. The payment must include the Account
Number and FRN referenced in the caption to the Adopting 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. Payments by wire transfer may be
made to ABA Number 021030004, receiving bank Federal Reserve Bank of New
York and account number 27000001. Horizon and Reduced Rate Long Distance
will also send electronic notification on the date said payment is made to
Johnny.Drake@fcc.gov.
15. Waivers. Horizon and Reduced Rate Long Distance waive any and all
rights they may have to seek administrative or judicial reconsideration,
review, appeal or stay, or to otherwise challenge or contest the validity
of this Consent Decree and the Adopting Order. Horizon and Reduced Rate
Long Distance shall retain the right to challenge the Commission's
interpretation of the Consent Decree or any terms contained herein, and of
the Rules. If any Party (or the United States on behalf of the Commission)
brings a judicial action to enforce the terms of the Adopting Order or
this Consent Decree, neither Horizon, Reduced Rate Long Distance, nor the
Bureau shall contest the validity of the Consent Decree or the Adopting
Order, and Horizon and Reduced Rate Long Distance shall waive any
statutory right to a trial de novo and shall consent to a judgment
incorporating the terms of this Consent Decree. Horizon and Reduced Rate
Long Distance hereby agree to waive any claims they may otherwise have
under the Equal Access to Justice Act, 5 U.S.C. S: 504 and 47 C.F.R. S:
1.1501 et seq., relating to the matters contained in this Consent Decree.
16. Severability. The Parties agree that if any of the provisions of the
Adopting Order or the Consent Decree shall be invalid or unenforceable,
such invalidity or unenforceability shall not invalidate or render
unenforceable the entire Adopting Order or Consent Decree, but rather the
entire Adopting Order or Consent Decree shall be construed as if not
containing the particular invalid or unenforceable provision or
provisions, and the rights and obligations of the Parties shall be
construed and enforced accordingly. In the event that this Consent Decree
in its entirety is rendered invalid by any court of competent
jurisdiction, it shall become null and void and may not be used in any
manner in any legal proceeding.
17. Privileged and Confidential Documents. By this Consent Decree, Horizon
and Reduced Rate Long Distance neither waive nor alter their rights to
assert and seek protection from disclosure of any privileged or otherwise
confidential and protected documents and information, or to seek
appropriate safeguards of confidentiality for any competitively sensitive
or proprietary information.
18. Subsequent Rule or Order. The Parties agree that if any provision of
this Consent Decree is inconsistent with any subsequent rule or order
adopted by the Commission, that provision will be superseded by such
Commission rule or order.
19. Successors and Assigns. Horizon and Reduced Rate Long Distance agree
that the provisions of this Consent Decree shall be binding on their
successors, assigns, and transferees.
20. Final Settlement. The Parties agree and acknowledge that this Consent
Decree shall constitute a final settlement of the Investigations. The
Parties agree that this Consent Decree does not constitute either an
adjudication on the merits or a factual or legal finding or determination
regarding any compliance or noncompliance by Horizon or Reduced Rate Long
Distance with the requirements of the Act or the Commission's rules or
orders. The Parties agree that this Consent Decree is for settlement
purposes only, and that by agreeing to this Consent Decree, Horizon and
Reduced Rate Long Distance do not admit or deny any noncompliance,
violation, or liability associated with or arising from their actions or
omissions involving the Act or the Rules that are the subject of this
Consent Decree.
21. Modifications. This Consent Decree cannot be modified without the
advance written consent of both parties.
22. Paragraph Headings. The headings of the paragraphs in this Consent
Decree are inserted for convenience only and are not intended to affect
the meaning or interpretation of this Consent Decree.
23. Counterparts. This Consent Decree may be signed in counterparts
(including by facsimile or electronic mail), each of which, when executed
and delivered, shall be an original, and all of which counterparts
together shall constitute one and the same fully executed instrument.
24. Authorized Representative. Each Party represents and warrants that it
has full power and authority to enter into this Consent Decree.
For: Horizon Telecom, Inc.
__________ _______________________
Date Robert Sorrentino
President
For: Reduced Rate Long Distance, LLC
__________ _______________________
Date Robert Sorrentino
President
For: Federal Communications Commission
__________ ________________________________
Date P. Michele Ellison
Chief, Enforcement Bureau
47 U.S.C. S:S: 201(b), 258.
47 C.F.R. S:S: 1.717, 64.1120, 64.1130.
In the Matter of Horizon Telecom, Inc., Notice of Apparent Liability for
Forfeiture, Apparent Liability for Forfeiture, 23 FCC Rcd 3485
(2008)(Horizon NAL).
47 C.F.R. S: 1.717.
In the Matter of Reduced Rate Long Distance, Notice of Apparent Liability
for Forfeiture, 23 FCC Rcd 2697 (Enf. Bur. 2008)(Reduced Rate Long
Distance NAL).
Horizon permanently discontinued all interstate, international, and
intrastate long distance services in April 2007. Horizon's
telecommunications assets, including its customer base, were transferred
to Reduced Rate Long Distance on January 23, 2009.
47 U.S.C. S: 154(i).
47 CFR S:S: 0.111, 0.311.
47 U.S.C. S:S: 201(b), 258.
47 C.F.R. S:S: 1.717, 64.1120, 64.1130.
In the Matter of Horizon Telecom, Inc., Notice of Apparent Liability for
Forfeiture, Apparent Liability for Forfeiture, 23 FCC Rcd 3485
(2008)(Horizon NAL). In the Matter of Reduced Rate Long Distance, Notice
of Apparent Liability for Forfeiture, 23 FCC Rcd 2697 (Enf. Bur.
2008)(Reduced Rate Long Distance NAL).
47 U.S.C. S: 258(a); Telecommunications Act of 1996, Pub. L. No. 104-104,
110 Stat. 56 (1996); Implementation of the Subscriber Carrier Selection
Changes Provisions of the Telecommunications Act of 1996; Policies and
Rules Concerning Unauthorized Changes of Consumers' Long Distance
Carriers, CC Docket No. 94-129, Second Report and Order and Further Notice
of Proposed Rule Making, 14 FCC Rcd 1508 (1998) (Section 258 Order),
stayed in part, MCI WorldCom v. FCC, No. 99-1125 (D.C. Cir. May 18, 1999);
First Order on Reconsideration, 15 FCC Rcd 8158 (2000); stay lifted, MCI
WorldCom v. FCC, No. 99-1125 (D.C. Cir. June 27, 2000); Third Report and
Order and Second Order on Reconsideration, 15 FCC Rcd 15996 (2000),
Errata, DA No. 00-2163 (rel. Sept. 25, 2000), Erratum, DA No. 00-2192
(rel. Oct. 4, 2000), Order, FCC 01-67 (rel. Feb. 22, 2001); Third Order on
Reconsideration and Second Further Notice of Proposed Rule Making, 18 FCC
Rcd 5099 (2003); Order, 18 FCC Rcd 10997 (2003). Prior to the adoption of
Section 258, the Commission had taken various steps to address the
slamming problem. See, e.g., Policies and Rules Concerning Unauthorized
Changes of Consumers' Long Distance Carriers, CC Docket No. 94-129, Report
and Order, 10 FCC Rcd 9560 (1995), stayed in part, 11 FCC Rcd 856 (1995);
Policies and Rules Concerning Changing Long Distance Carriers, CC Docket
No. 91-64, 7 FCC Rcd 1038 (1992), reconsideration denied, 8 FCC Rcd 3215
(1993); Investigation of Access and Divestiture Related Tariffs, CC Docket
No. 83-1145, Phase I, 101 F.C.C.2d 911, 101 F.C.C.2d 935, reconsideration
denied, 102 F.C.C.2d 503 (1985).
47 U.S.C. S: 258(a).
See generally Section 258 Order.
47 C.F.R. S: 64.1120.
47 U.S.C. S: 258(a).
47 C.F.R. S: 64.1120(c).
47 C.F.R. S: 64.1120(e)(3). Additionally, according to the companies, a
copy of the notice to affected customers was filed by Horizon and Reduced
Rate Long Distance on December 22, 2008 in CC Docket No. 00-257, pursuant
to Section 64.1120(e)(1) of the Commission's rules, 47 C.F.R. S:
64.1120(e)(1), and the Notification of Pro Forma Assignment of Customer
Base from Horizon Telecom, Inc. to Reduced Rate Long Distance, LLC was
filed with the Commission on February 3, 2009, pursuant to Sections
63.03(d) and 63.24(f)(2), 47 C.F.R. S:S: 63.03(d), 63.24(f)(2).
Letter from Marcy Greene, Deputy Division Chief, Telecommunications
Consumers Division, FCC Enforcement Bureau, to Cheyenne Devine, Customer
Service Manager, Horizon Telecom, Inc. (June 28, 2007) (on file in
EB-07-TC-4006).
Letter from Andrew Lustigman, The Lustigman Firm, P.C., Counsel to Horizon
Telecom, Inc., to Marcy Greene, Deputy Division Chief, Telecommunications
Consumers Division, FCC Enforcement Bureau, (July 27, 2007) (on file in
EB-07-TC-4006).
Letter from Andrew Lustigman, The Lustigman Firm, P.C., Counsel to Horizon
Telecom, Inc., to Marcy Greene, Deputy Division Chief, Telecommunications
Consumers Division, FCC Enforcement Bureau, (September 19, 2007) (on file
in EB-07-TC-4006).
See supra note 1.
Written Statement in Response to Notice of Apparent Liability for
Forfeiture from Thomas K. Crowe and Cheng-yi Liu, Law Offices of Thomas K.
Crowe, P.C., Counsel to Horizon Telecom, Inc., to Marlene H. Dortch,
Secretary, Federal Communications Commission, filed March 31, 2008 (on
file in EB-07-TC-4006).
Letter from Marcy Greene, Deputy Division Chief, Telecommunications
Consumers Division, FCC Enforcement Bureau, to Robert Sorrentino, Chief
Executive Officer, Reduced Rate Long Distance, LLC, and Adam Z. Solomon,
The Lustigman Firm, P.C. (January 24, 2008) (on file in EB-08-TC-1067).
Letter from Andrew Lustigman, The Lustigman Firm, P.C., Counsel to Reduced
Rate Long Distance, LLC, to Marcy Greene, Deputy Division Chief,
Telecommunications Consumers Division, FCC Enforcement Bureau (March 3,
2008) (on file in EB-08-TC-1067).
Letter from Andrew Lustigman, The Lustigman Firm, P.C., Counsel to Reduced
Rate Long Distance, LLC, to Marcy Greene, Deputy Division Chief,
Telecommunications Consumers Division, FCC Enforcement Bureau, (March 12,
2008) (on file in EB-08-TC-1067).
See supra note 2.
Written Statement in Response to Notice of Apparent Liability for
Forfeiture from Thomas K. Crowe and Cheng-yi Liu, Law Offices of Thomas K.
Crowe, P.C., and Andrew Lustigman and Adam Z. Solomon, The Lustigman Firm,
P.C., Counsel to Reduced Rate Long Distance, LLC, to Marlene H. Dortch,
Secretary, Federal Communications Commission, filed March 3, 2008 (on file
in EB-08-TC-1067).
47 C.F.R. S: 1.16.
See supra note 3.
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