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Before the
Federal Communications Commission
Washington, D.C. 20554
In the Matter of Kustom Musical Amplification, Inc., d/b/a Hanser Music
Group ) ) ) ) ) File No.: EB-10-SE-030 Acct. No.: 201332100009 FRN:
0022521389
ORDER
Adopted: March 15, 2013 Released: March 18, 2013
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 Kustom Musical Amplification, Inc., d/b/a
Hanser Music Group (KMA). The Consent Decree resolves and terminates
the Bureau's investigation into KMA's compliance with Section 302(b)
of the Communications Act of 1934, as amended (Act),^ and Sections
2.803, 2.1203, 2.1204, 2.1205, 15.2l, and 15.105 of the Commission's
rules (Rules)^ pertaining to the marketing of digital radio frequency
devices, including guitar amplifiers, speaker systems, microphones,
and footswitches.
2. The Bureau and KMA have negotiated the Consent Decree that resolves
this matter. A copy of the Consent Decree is attached hereto and
incorporated herein 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 investigation.
4. In the absence of material new evidence relating to this matter, we
conclude that our investigation raises no substantial or material
questions of fact as to whether KMA possesses the basic
qualifications, including those related to character, to hold or
obtain any Commission license or authorization.
5. Accordingly, IT IS ORDERED that, pursuant to Sections 4(i), 4(j), and
503(b) of the Act,^ and Sections 0.111 and 0.311 of the Rules,^ the
Consent Decree attached to this Order IS ADOPTED.
6. IT IS FURTHER ORDERED that the above-captioned investigation IS
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 Robert Imhoff, President, Kustom Musical Amplification,
Inc., d/b/a Hanser Music Group, 3015 Kustom Drive, Hebron, KY 41048,
and to Steven C. Coffaro, Esq., Keating Muething & Klekamp PLL,
Counsel for Kustom Musical Amplification, Inc., d/b/a Hanser Music
Group, One East 4^th Street, Suite 1400, Cincinnati, OH 45202.
FEDERAL COMMUNICATIONS COMMISSION
P. Michele Ellison
Chief, Enforcement Bureau
Before the
Federal Communications Commission
Washington, DC 20554
In the Matter of Kustom Musical Amplification, Inc., d/b/a Hanser Music
Group ) ) ) ) ) File No.: EB-10-SE-030 Acct. No.: 201332100009 FRN:
0022521389
CONSENT DECREE
The Enforcement Bureau of the Federal Communications Commission and Kustom
Musical Amplification, Inc., d/b/a Hanser Music Group, by their authorized
representatives, hereby enter into this Consent Decree for the purpose of
terminating the Enforcement Bureau's investigation into possible
violations of Section 302(b) of the Communications Act of 1934, as
amended,^ and Sections 2.803, 2.1203, 2.1204, 2.1205, 15.21, and 15.105 of
the Commission's rules^ pertaining to the marketing of digital radio
frequency devices, including guitar amplifiers, speaker systems,
microphones, and footswitches.
I. DEFINITIONS
1. For the 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" means an order of the Bureau adopting the
terms of this Consent Decree without change, addition,
deletion, or modification.
c. "Bureau" means the Enforcement Bureau of the Federal
Communications Commission.
d. "Communications Laws" means collectively, the Act, the Rules,
and the published and promulgated orders and decisions of the
Commission to which KMA is subject by virtue of its business
activities, including but not limited to, the Equipment
Marketing Rules.
e. "Commission" and "FCC" mean the Federal Communications
Commission and all of its bureaus and offices.
f. "Compliance Plan" means the compliance obligations, program,
and procedures described in this Consent Degree at paragraph
10.
g. "Covered Employees" means all employees and agents of KMA who
perform, or supervise, oversee, or manage the performance of,
duties that relate to KMA's responsibilities under the
Equipment Marketing Rules.
h. "Digital Device" means an unintentional radiator device or
system as defined in Section 15.3(k) of the Rules.^
i. "Effective Date" means the date on which the Bureau releases
the Adopting Order.
j. "Equipment Marketing Rules" means Section 302(b) of the Act^
and Sections 2.803, 2.1203, 2.1204, 2.1205, 15.19, 15.21, and
15.105 of the Rules^ and other Communications Laws governing
the marketing of radio frequency devices within the United
States and its territories.
k. "Investigation" means the investigation commenced by the
Bureau's September 10, 2010 letter of inquiry^ regarding
whether the marketing of certain Digital Devices by KMA
complies with the Equipment Marketing Rules.
l. "KMA" means Kustom Musical Amplification, Inc., d/b/a Hanser
Music Group, and its predecessors-in-interest and
successors-in-interest.
m. "Operating Procedures" means the standard, internal operating
procedures and compliance policies established by KMA to
implement the Compliance Plan.
n. "Parties" means KMA and the Bureau, each of which is a
"Party."
o. "Rules" means the Commission's regulations found in Title 47
of the Code of Federal Regulations.
II. BACKGROUND
2. Pursuant to Section 302(b) of the Act^ and Sections 2.803, 15.19,
15.21, and 15.105 of the Rules,^ certain Digital Devices may not
be marketed in the United States unless the devices comply with
the applicable technical standards as well as the administrative
requirements relating to equipment labeling and consumer
disclosure. Section 2.803(e)(4) of the Rules defines "marketing"
as the "sale or lease, or offering for sale or lease, including
advertising for sale or lease, or importation, shipment or
distribution for the purpose of selling or leasing or offering
for sale or lease."^
3. Pursuant to Sections 2.1203, 2.1204, and 2.1205 of the Rules, a
Digital Device may not be imported into the United States unless
the importer, ultimate consignee, or customs broker, files with
the United States Customs and Border Protection an FCC Form 740
(or the electronic equivalent thereof) declaring that the device
meets one of the import conditions set forth in Section 2.1204 of
the Rules.^ KMA markets Digital Devices such as guitar
amplifiers, speaker systems, microphones and footswitches. These
Digital Devices are unintentional radiators subject to
authorization via the Commission's equipment verification
procedures.^
4. On September 10, 2010, the Bureau's Spectrum Enforcement Division
(Division) issued a letter of inquiry (LOI) to KMA, directing KMA
to submit a sworn written response to a series of questions
relating to KMA's marketing of Digital Devices.^ KMA responded to
the LOI on October 15, 2010 (LOI Response).^ In its LOI Response,
KMA provided information and documents relating to the Digital
Devices marketed by the company.^ In response to a subsequent
inquiry from the Division,^ KMA provided information relating to
its obligation to include a consumer disclosure statement in the
user manual of certain Digital Devices marketed by the company.^
KMA also provided information related to its importation of
certain Digital Devices and its obligation to file FCC Form 740s
with the United States Customs and Border Protection in
connection with the importation of such Digital Devices.^ The
Bureau and KMA executed tolling agreements to toll the statute of
limitations.^
III. TERMS OF AGREEMENT
5. 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.
6. Jurisdiction. KMA agrees that the Bureau has jurisdiction over
it and the matters contained in this Consent Decree and that the
Bureau has the authority to enter into and adopt this Consent
Decree.
7. Effective Date; Violations. The Parties agree that this Consent
Decree shall become effective on the Effective Date as defined
herein. As of 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.
8. Termination of Investigation. In express reliance on the
covenants and representations in this Consent Decree and to
avoid further expenditure of public resources, the Bureau agrees
to terminate the Investigation. In consideration for the
termination of the Investigation, KMA agrees to the terms,
conditions, and procedures contained herein. The Bureau further
agrees that in the absence of new material evidence, the Bureau
will not use the facts developed in the Investigation through
the Effective Date, or the existence of this Consent Decree, to
institute on its own motion any new proceeding, formal or
informal, or take any action on its own motion against KMA
concerning the matters that were the subject of the
Investigation. The Bureau also agrees that in the absence of new
material evidence it will not use the facts developed in the
Investigation through the Effective Date, or the existence of
this Consent Decree, to institute on its own motion any
proceeding, formal or informal, or take any action on its own
motion against KMA with respect to KMA's basic qualifications,
including its character qualifications, to be a Commission
licensee or to hold Commission licenses or authorizations.
9. Compliance Officer. Within thirty (30) calendar days after the
Effective Date, KMA shall designate a senior corporate manager
with the requisite corporate and organizational authority to
serve as Compliance Officer and to discharge the duties set
forth below. The Compliance Officer shall be responsible for
developing, implementing, and administering the Compliance Plan
and ensuring that KMA complies with the terms and conditions of
the Compliance Plan and this Consent Decree. In addition to the
general knowledge of the Communications Laws necessary to
discharge his/her duties under this Consent Decree, the
Compliance Officer shall have specific knowledge of the
Equipment Marketing Rules prior to assuming his/her duties.
10. Compliance Plan. For purposes of settling the matters set forth
herein, KMA agrees that it shall within sixty (60) calendar days
after the Effective Date, develop and implement a Compliance
Plan designed to ensure future compliance with the
Communications Laws and with the terms and conditions of this
Consent Decree. With respect to the Equipment Marketing Rules,
KMA shall implement the following procedures:
a. Operating Procedures on Equipment Marketing. Within sixty (60)
calendar days after the Effective Date, KMA shall establish Operating
Procedures that all Covered Employees must follow to help ensure
KMA's compliance with the Equipment Marketing Rules. KMA's Operating
Procedures shall include internal procedures and policies
specifically designed to ensure that (i) prior to the initiation of
marketing (as such term is defined in Section 2.803 of the Rules^),
all Digital Devices and other radio frequency devices to be marketed
by KMA comply with applicable technical standards, have been properly
authorized (via the certification, verification, or declaration of
conformity procedures, as applicable), and comply with the applicable
administrative requirements relating to equipment labeling and
consumer disclosure; and (ii) KMA complies with the requirements of
Sections 2.1203, 2.1204 and 2.1205 of the Rules relating to the
importation and entry of Digital Devices into the United States,
including the filing with the United States Customs and Border
Protection of an FCC Form 740 (or the electronic equivalent thereof)
that accurately identifies the importation condition(s) satisfied for
each such importation.^
b. Compliance Manual. Within sixty (60) calendar days after the
Effective Date, the Compliance Officer shall develop and distribute a
Compliance Manual to all Covered Employees. The Compliance Manual
shall explain the Equipment Marketing Rules, including the
obligations to secure an equipment authorization from the FCC prior
to marketing a Digital Device and to meet all FCC requirements for
the importation and entry of such Digital Device into the United
States, and set forth the Operating Procedures that Covered Employees
shall follow to help ensure KMA's compliance with the Equipment
Marketing Rules. KMA shall periodically review and revise the
Compliance Manual as necessary to ensure that the information set
forth therein remains current and complete. KMA shall distribute any
revisions to the Compliance Manual promptly to all Covered Employees.
c. Compliance Training Program. KMA shall establish and implement a
Compliance Training Program on compliance with the Equipment
Marketing Rules and the Operating Procedures. As part of the
Compliance Training Program, Covered Employees shall be advised of
KMA's obligation to report any noncompliance with the Equipment
Marketing Rules under paragraph 11 of this Consent Decree and shall
be instructed on how to disclose noncompliance to the Compliance
Officer. All Covered Employees shall be trained pursuant to the
Compliance Training Program within sixty (60) calendar days after the
Effective Date, except that any person who becomes a Covered
Employee at any time after the Effective Date shall be trained within
thirty (30) calendar days after the date such person becomes a
Covered Employee. KMA shall repeat the compliance training on an
annual basis, and shall periodically review and revise the Compliance
Training Program as necessary to ensure that it remains current and
complete and to enhance its effectiveness.
11. Reporting Noncompliance. KMA shall report any noncompliance with the
Equipment Marketing Rules and with the terms and conditions of this
Consent Decree within fifteen (15) calendar days after discovery of
such noncompliance. Such reports shall include a detailed explanation
of (i) each instance of noncompliance; (ii) the steps that KMA has
taken or will take to remedy such noncompliance; (iii) the schedule
on which such remedial actions will be taken; and (iv) the steps that
KMA has taken or will take to prevent the recurrence of any such
noncompliance. All reports of noncompliance shall be submitted to the
Chief, Spectrum Enforcement Division, Enforcement Bureau, Federal
Communications Commission, Room 3-C366, 445 12th Street, S.W.,
Washington, DC 20554, with a copy submitted electronically to
Paul.Noone at Paul.Noone@fcc.gov and to Pamera Hairston at
Pamera.Hairston@fcc.gov.
12. Compliance Reports. KMA shall file Compliance Reports with the
Commission ninety (90) calendar days after the Effective Date, twelve
(12) months after the Effective Date, and twenty-four (24) months
after the Effective Date.
a. Each compliance report shall include a detailed description of KMA's
efforts during the relevant period to comply with the terms and
conditions of this Consent Decree and the Equipment Marketing Rules.
In addition, each Compliance Report shall include a certification by
the Compliance Officer, as an agent of and on behalf of KMA, stating
that the Compliance Officer has personal knowledge that KMA (i) has
established and implemented the Compliance Plan; (ii) has utilized the
Operating Procedures since the implementation of the Compliance Plan;
and (iii) is not aware of any instances of noncompliance with the
terms and conditions of this Consent Decree, including the reporting
obligations set forth in paragraph 11 hereof.
b. The Compliance Officer's certification shall be accompanied by a
statement explaining the basis for such certification and must comply
with Section 1.16 of the Rules^ and be subscribed to as true under
penalty of perjury in substantially the form set forth therein.
c. If the Compliance Officer cannot provide the requisite certification,
the Compliance Officer, as an agent of and on behalf of KMA, shall
provide the Commission with a detailed explanation of the reason(s)
why and describe fully (i) each instance of noncompliance; (ii) the
steps that KMA has taken or will take to remedy such noncompliance,
including the schedule on which proposed remedial actions will be
taken; and (iii) the steps that KMA has taken or will take to prevent
the recurrence of any such noncompliance, including the schedule on
which such preventive action will be taken.
d. All Compliance Reports shall be submitted to the Chief, Spectrum
Enforcement Division, Enforcement Bureau, Federal Communications
Commission, 445 12th Street, S.W., Washington, DC 20554, with a copy
submitted electronically to Paul Noone at Paul.Noone@fcc.gov and to
Pamera Hairston at Pamera.Hairston@fcc.gov.
13. Termination Date. Unless stated otherwise, the obligations set forth
in paragraphs 9 through 12 of this Consent Decree shall expire
twenty-four (24) months after the Effective Date.
14. Voluntary Contribution. KMA agrees that it will make a voluntary
contribution to the United States Treasury in the amount of fourteen
thousand five hundred dollars ($14,500) dollars within thirty (30)
calendar days after the Effective Date. KMA shall also send
electronic notification of payment to Paul Noone at
Paul.Noone@fcc.gov, Pamera Hairston at Pamera.Hairston@fcc.gov, and
to Samantha Peoples at Sam.Peoples@fcc.gov on the date said payment
is made. The payment must be made by check or similar instrument,
wire transfer, or credit card, and must include the NAL/Account
number and FRN referenced above. Regardless of the form of payment, a
completed FCC Form 159 (Remittance Advice) must be submitted.^ When
completing the FCC Form 159, enter the Account Number in block number
23A (call sign/other ID) and enter the letters "FORF" in block number
24A (payment type code). Below are additional instructions you
should follow based on the form of payment you select:
* Payment by check or money order must be made payable to the order of
the Federal Communications Commission. Such payments (along with the
completed Form 159) must be mailed to Federal Communications
Commission, P.O. Box 979088, St. Louis, MO 63197-9000, or sent
via overnight mail to U.S. Bank - Government Lockbox #979088,
SL-MO-C2-GL, 1005 Convention Plaza, St. Louis, MO 63101.
* Payment by wire transfer must be made to ABA Number 021030004,
receiving bank TREAS/NYC, and Account Number 27000001. To complete
the wire transfer and ensure appropriate crediting of the wired funds,
a completed Form 159 must be faxed to U.S. Bank at (314) 418-4232 on
the same business day the wire transfer is initiated.
* Payment by credit card must be made by providing the required credit
card information on FCC Form 159 and signing and dating the Form 159
to authorize the credit card payment. The completed Form 159 must then
be mailed to Federal Communications Commission, P.O. Box 979088, St.
Louis, MO 63197-9000, or sent via overnight mail to U.S. Bank -
Government Lockbox #979088, SL-MO-C2-GL, 1005 Convention Plaza, St.
Louis, MO 63101.
If you have questions regarding payment procedures, please contact the
Financial Operations Group Help Desk by phone, 1-877-480-3201, or by
e-mail, ARINQUIRIES@fcc.gov.
15. Waivers. KMA waives any and all rights it 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, provided the Bureau issues an Adopting
Order as defined herein. KMA shall retain the right to challenge
Commission interpretation of the Consent Decree or any terms
contained herein. If either Party (or the United States on behalf of
the Commission) brings a judicial action to enforce the terms of the
Adopting Order, neither KMA nor the Commission shall contest the
validity of the Consent Decree or of the Adopting Order, and KMA
shall waive any statutory right to a trial de novo. KMA hereby agrees
to waive any claims it may have under the Equal Access to Justice
Act^ relating to the matters addressed in this Consent Decree.
16. Invalidity. 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. Subsequent Rule or Order. The Parties agree that if any provision of
the Consent Decree conflicts with any subsequent Rule or order
adopted by the Commission (except an order specifically intended to
revise the terms of this Consent Decree to which KMA does not
expressly consent) that provision will be superseded by such Rule or
Commission order.
18. Successors and Assigns. KMA agrees that the provisions of this
Consent Decree shall be binding on its successors, assigns, and
transferees.
19. Final Settlement. Based on the Investigation, the Bureau contends
that it may have certain claims against KMA related to possible
violations of Section 302(b) of the Act and Sections 2.803, 2.1203,
2.1204, 2.1205, 15.21, and 15.105 of the Rules. KMA neither admits
nor denies any such violations, and the Commission does not concede
or otherwise represent that its claims are not well founded. The
Parties agree and acknowledge that this Consent Decree shall
constitute a final settlement between the Parties with respect to the
Investigation. The Parties also 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 with the Communications Laws.
20. Modifications. This Consent Decree cannot be modified without the
written consent of both Parties.
21. 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.
22. Authorized Representative. The individual signing this Consent Decree
on behalf of KMA represents and warrants that he is authorized by KMA
to execute this Consent Decree and to bind KMA to the obligations set
forth herein. The FCC signatory represents that he is signing this
Consent Decree in his official capacity and that he is authorized to
execute this Consent Decree.
23. Counterparts. This Consent Decree may be signed in any number of
counterparts (including by facsimile), 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.
________________________________
John D. Poutasse
Chief, Spectrum Enforcement Division
Enforcement Bureau
_______________________________
Date
_______________________________
John F. Hanser III
President, Chief Executive Officer
Kustom Musical Amplification, Inc.,
d/b/a Hanser Music Group
______________________________
Date
^ ^ 47 U.S.C. S 302a(b).
^ ^ 47 C.F.R. SS 2.803, 2.1203, 2.1204, 2.1205, 15.21, 15.105.
^ 47 U.S.C. SS 154(i), 154(j), 503(b).
^ 47 C.F.R. SS 0.111, 0.311.
^ 47 U.S.C. S 302a(b).
^ 47 C.F.R. SS 2.803, 2.1203, 2.1204, 2.1205, 15.21, 15.105.
^ Id. S 15.3(k).
^ 47 U.S.C. S 302a(b).
^ 47 C.F.R. SS 2.803, 2.1203, 2.1204, 2.1205, 15.19, 15.21, 15.105.
^ See Letter from Kathryn S. Berthot, Chief, Spectrum Enforcement
Division, FCC Enforcement Bureau, to Kustom Musical Amplification, Inc.
(Sept. 10, 2010) (on file in EB-10-SE-030).
^ See 47 U.S.C. S 302a(b).
^ See 47 C.F.R. SS 2.803, 15.19, 15.21, 15.105.
^ Id. S 2.803(e)(4).
^ See id. SS 2.1203, 2.1204, 2.1205.
^ Id. S 15.101.
^ See supra note 6.
^ See Letter from Robert Imhoff, President, Hanser Music Group, to
Katherine Power, Attorney, Spectrum Enforcement Division, FCC Enforcement
Bureau (Oct. 15, 2010) (on file in EB-10-SE-030). Hanser Music Group is a
trade name for Kustom Musical Amplification, Inc.
^ See id.
^ See Letter from John D. Poutasse, Acting Chief, Spectrum Enforcement
Division, FCC Enforcement Bureau, to Robert Imhoff, President, Hanser
Music Group (May 2, 2011) (on file in EB-10-SE-030).
^ See Letter from Robert Imhoff, President, Hanser Music Group, to
Katherine Power, Attorney, Spectrum Enforcement Division, FCC Enforcement
Bureau at 1 (May 16, 2011) (on file in EB-10-SE-030).
^ See E-mail from Steven C. Coffaro, Keating Muething & Klekamp PLL,
Counsel to Hanser Music Group, to Katherine Power, Spectrum Enforcement
Division, FCC Enforcement Bureau (Nov. 13, 2012, 11:06 EDT) (on file in
EB-10-SE-030).
^ See, e.g., Tolling Agreement Extension, File No. EB-10-SE-030, executed
by and between John D. Poutasse, Chief, Spectrum Enforcement Division, FCC
Enforcement Bureau, and Steven C. Coffaro, Keating Muething & Klekamp PLL,
Counsel to Hanser Music Group (July 17, 2012) (on file in EB-10-SE-030).
^ See supra para. 2.
^ See 47 C.F.R. SS 2.1203, 2.1204, 2.1205.
^ 47 C.F.R. S 1.16.
^ An FCC Form 159 and detailed instructions for completing the form may be
obtained at http://www.fcc.gov/Forms/Form159/159.pdf.
^ Equal Access to Justice Act, Pub L. No. 96-481, 94 Stat. 2325 (1980)
(codified at 5 U.S.C. S 504); see also 47 C.F.R. SS 1.1501-1.1530.
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Federal Communications Commission DA 13-423
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Federal Communications Commission DA 13-423
Federal Communications Commission DA 13-423
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