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   Federal Communications Commission DA 13-684

                                   Before the

                       Federal Communications Commission

                              Washington, DC 20554

   In the Matter of 1 UGLY ENTERPRISE, LLC Applicant in Auction No. 79 ) ) )
   ) ) ) ) File No.: EB-09-IH-1532 Acct. No.: 201332080019 FRN: 0018897280




                                     ORDER

   Adopted: May 9, 2013 Released: May 14, 2013

   By the Chief, Enforcement Bureau:

    1. In this Order, we adopt a Consent Decree entered into between the
       Enforcement Bureau (Bureau) of the Federal Communications Commission
       and 1 Ugly Enterprise, LLC (1 Ugly Enterprise). The Consent Decree
       terminates the Bureau's investigation into possible violations by 1
       Ugly Enterprise of Section 1.2105(c) of the Commission's Rules, 47
       C.F.R. S 1.2105(c), relating to prohibited contacts and communications
       and the non-disclosure of such contacts and communications in
       Commission auctions.

    2. A copy of the Consent Decree, negotiated by the Bureau and 1 Ugly
       Enterprise, is attached hereto and incorporated herein by reference.

    3. After evaluating the facts before us and reviewing the terms of the
       Consent Decree, 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 1 Ugly Enterprise 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) and 503(b)
       of the Communications Act of 1934, as amended,^ 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: James L. Oyster, Esq., counsel for 1 Ugly, LLC, 108
       Oyster Lane, Castleton, VA 22716-2839.

   FEDERAL COMMUNICATIONS COMMISSION

   P. Michele Ellison

   Chief, Enforcement Bureau

                  Federal Communications Commission DA 13-684

                                   Before the

                       Federal Communications Commission

                             Washington, D.C. 20554

   In the Matter of 1 UGLY ENTERPRISE, LLC Applicant in Auction No. 79 ) ) )
   ) ) ) File No. EB-09-IH-1532 Acct. No. 201332080019 FRN No. 0018897280




                                 CONSENT DECREE

    1. The Enforcement Bureau of the Federal Communications Commission, 1
       Ugly Enterprise, LLC, and Matthew Salazar, by their authorized
       representatives, hereby enter into this Consent Decree for the purpose
       of terminating the Enforcement Bureau's investigation into possible
       violations by 1 Ugly Enterprise of Section 1.2105(c) of the
       Commission's Rules,^ relating to prohibited contacts and
       communications in Commission auctions.

   I. 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" means an order of the Bureau adopting this Consent
        Decree without any modifications adverse to 1 Ugly Enterprise, LLC.

     c. "1 Ugly Enterprise" or the "Company" means 1 Ugly Enterprise, LLC, of
        which Matthew Salazar is the sole principal, and its
        predecessors-in-interest and successors-in-interest.

     d. "Bureau" means the Enforcement Bureau of the Federal Communications
        Commission.

     e. "Commission" and "FCC" mean the Federal Communications Commission and
        all of its bureaus and offices.

     f. "Communications Laws" means collectively, the Act, the Rules, and the
        published and promulgated orders and decisions of the Commission to
        which 1 Ugly Enterprise is subject by virtue of its business
        activities.

     g. "Deborah Salazar" means Deborah Salazar, an applicant in Auction No.
        79.

     h. "Effective Date" means the date on which the Bureau releases the
        Adopting Order.

     i. "Investigation" means the Bureau's investigation of 1 Ugly
        Enterprise's compliance with Section 1.2105(c) of the Commission's
        rules, arising from its conduct in Auction No. 79.

     j. "Jesus Salazar" means Matthew Salazar's father, Deborah Salazar's
        spouse, and an authorized bidder for Deborah Salazar in Auction No.
        79.

     k. "Matthew Salazar" means the sole principal of 1 Ugly Enterprise and
        the son of Deborah Salazar and Jesus Salazar.

     l. "Parties" means the Bureau, 1 Ugly Enterprise, LLC and Matthew
        Salazar, each of which is a "Party."

     m. "Rules" means the Commission's regulations found in Title 47 of the
        Code of Federal Regulations.

   II. BACKGROUND

    3. Section 1.2105(c)(1) of the Rules, commonly referred to as the
       Commission's "anti-collusion rule," prohibits auction applicants for
       licenses in any of the same geographic license areas from "cooperating
       or collaborating with respect to, discussing with each other, or
       disclosing to each other in any manner the substance of their own, or
       each other's, or any other competing applicants' bids or bidding
       strategies, or discussing or negotiating settlement agreements" ^
       beginning immediately after the short-form application filing deadline
       until after the down payment deadline "unless such applicants are
       members of a bidding consortium or other joint bidding arrangement
       identified on the bidder's short-form application . . . ."^ In
       addition, Section 1.2105(c)(6) of the Rules requires that "[a]ny
       applicant that makes or receives a communication of bids or bidding
       strategies prohibited under [Section 1.2105(c)(1) of the Rules] shall
       report such communication in writing to the Commission immediately,
       and in no case later than five business days after the communication
       occurs."^

    4. On February 27, 2009, the Commission's Wireless Telecommunications
       Bureau and Media Bureau announced the auction of 122 FM broadcast
       construction permits in Auction No. 79.^ For Auction No. 79, the
       anti-collusion rule prohibitions were in effect from 6:00 p.m. ET on
       June 25, 2009, the short-form application filing deadline, until
       October 2, 2009, the down payment deadline. ^ Bidding in Auction No.
       79 began on September 1, 2009, and concluded on September 15, 2009.

    5. 1 Ugly Enterprise is a limited liability company based in San Angelo,
       Texas. Its sole owner is Matthew Salazar. Deborah Salazar is an
       individual residing in Uvalde, Texas and is the mother of Matthew
       Salazar. On June 25, 2009, 1 Ugly Enterprise and Deborah Salazar each
       submitted a short-form application to participate in Auction No. 79.^
       1 Ugly Enterprise selected nine construction permits on which it
       intended to bid in Auction No. 79, including the construction permit
       for the Peach Springs, Arizona, market. Deborah Salazar also
       identified the construction permit for the Peach Springs, Arizona,
       market as among the construction permits on which she intended to bid.
       Additionally, in its short-form application, 1 Ugly Enterprise
       identified Matthew Salazar as its sole authorized bidder. In her
       short-form application, Deborah Salazar specified that she and her
       spouse, Jesus Salazar, father of Matthew Salazar, would serve as
       authorized bidders. Neither 1 Ugly Enterprise nor Deborah Salazar
       identified the existence of any joint bidding consortium or agreement
       between them nor did they disclose that Deborah Salazar and Jesus
       Salazar were Matthew Salazar's parents. Because these two applicants
       did not disclose the existence of any bidding agreement between them,
       the Commission's anti-collusion rule prohibited them from
       communicating with each other about bids or bidding strategies during
       the prescribed period.

    6. At the conclusion of Auction No. 79, 1 Ugly Enterprise was the winning
       bidder for an FM construction permit in Leakey, Texas. Thereafter, on
       July 31, 2009, 1 Ugly Enterprise submitted its upfront payment to the
       Commission along with a Remittance Advice Form (FCC Form 159). A
       review of the FCC Form 159 revealed that Jesus Salazar, the authorized
       bidder for Deborah Salazar, had signed the FCC Form 159 certifying
       that he was the responsible party for making 1 Ugly Enterprise's
       upfront payment of $2,500. This prompted the Wireless
       Telecommunications Bureau to refer the matter to the Enforcement
       Bureau for investigation of a potential violation of Section 1.
       2105(c) of the Commission's Rules.

    7. On October 22, 2009, the Enforcement Bureau commenced its
       Investigation by issuing letters of inquiry to 1 Ugly Enterprise,
       Deborah Salazar, and Jesus Salazar. The letters of inquiry sought
       information about, among other things, their respective conduct in
       Auction No. 79. In its response, 1 Ugly Enterprise stated that Matthew
       Salazar had communicated with Jesus Salazar a short time prior to the
       commencement of bidding regarding the construction permits on which 1
       Ugly Enterprise intended to bid in Auction No. 79. The record also
       revealed that Jesus Salazar had paid 1 Ugly Enterprise's upfront
       payment from his own account to the Commission's auction payment
       lockbox bank, the U.S. Bank in St. Louis, Missouri. The record also
       revealed that Deborah Salazar had called Jesus Salazar's bank to
       initiate the wire transfer for 1 Ugly Enterprise. Neither 1 Ugly
       Enterprise nor Deborah Salazar notified the Commission about the
       communication between the two applicants, or between 1 Ugly Enterprise
       and Jesus Salazar.

    8. Following the Investigation, the Bureau, 1 Ugly Enterprise and Matthew
       Salazar entered into discussions aimed at resolving the Investigation.
       Between April and November, 2012, 1 Ugly Enterprise provided financial
       information to the Bureau documenting its claimed inability to pay a
       large forfeiture or voluntary contribution.

   III. TERMS OF AGREEMENT

    9. 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.

   10. Jurisdiction. 1 Ugly Enterprise and Matthew Salazar agree that the
       Bureau has jurisdiction over them and the matters contained in this
       Consent Decree and that the Bureau has authority to enter into and
       adopt this Consent Decree.

   11. 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.

   12. Termination of Investigation. 1 Ugly Enterprise represents that it
       does not hold any FCC licenses or authorizations other than the
       construction permit that it won in Auction No. 79 for a new FM station
       at Leakey, Texas. Matthew Salazar represents that he does not
       individually hold any FCC licenses or authorizations. 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, 1 Ugly Enterprise and Matthew
       Salazar agree 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 1
       Ugly Enterprise or Matthew Salazar 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 1
       Ugly Enterprise with respect to 1 Ugly Enterprise's basic
       qualifications, including its character qualifications to be a
       Commission licensee or to hold Commission licenses or authorizations.

   13. Settlement Terms. For purposes of settling the matters set forth
       herein, 1 Ugly Enterprise  and Matthew Salazar agree to the following:

     a. 1 Ugly Enterprise agrees that within five (5) business days of the
        Effective Date, it shall surrender to the Commission for cancellation
        the construction permit it won in Auction No. 79. It shall
        simultaneously send electronic notification of the surrender of its
        construction permit to Theresa Z. Cavanaugh at
        [1]Terry.Cavanaugh@fcc.gov and to Brian J. Carter at
        [2]Brian.Carter@fcc.gov.

     a. 1 Ugly Enterprise agrees to forfeit any and all monies paid to U.S.
        Bank relating in any manner whatsoever to its participation in
        Auction No. 79, and relinquish any claims thereto, including, but not
        limited to, its upfront payment, down payment, and any payments 1
        Ugly made in connection with the construction permit for which it was
        the highest bidder.

     b. 1 Ugly Enterprise agrees that it will not participate in any future
        auctions conducted by the Commission.

     c. Matthew Salazar agrees that he: (i) will not participate in any
        future auctions conducted by the Commission in his own capacity; (ii)
        will not participate in any future auctions conducted by the
        Commission on behalf of any other person or entity; and (iii) will
        not hold a position or interest of any kind and to any extent
        whatsoever (financial or otherwise) in an entity that participates in
        any future auctions conducted by the Commission. Nothing in this
        subparagraph shall prevent Matthew Salazar from holding a position or
        interest in an entity that is publicly traded on the New York Stock
        Exchange or the NASDAQ Stock Market.

   14. Compliance Reports. I Ugly Enterprise and Matthew Salazar shall each
       file a Compliance Report with the Commission ninety (90) calendar days
       after the Effective Date, twelve (12) months after the Effective Date,
       twenty-four (24) months after the Effective Date, and thirty-six (36)
       months after the Effective Date. 1 Ugly Enterprise and Matthew Salazar
       shall certify in their respective Compliance Reports to their
       compliance with the terms and conditions contained in this Consent
       Decree. If they are unable to provide the requisite certification,
       they shall provide a full and complete explanation of the reasons why
       they are not able to do so. All Compliance Reports shall be submitted
       to the Chief, Investigations and Hearings Division, Enforcement
       Bureau, Federal Communications Commission, Room 4-C330, 445 12th
       Street, S.W., Washington, D.C. 20554, with copies submitted
       electronically to Theresa Z. Cavanaugh at Terry.Cavanaugh@fcc.gov and
       to Brian J. Carter at [3]Brian.Carter@fcc.gov.

   15. Voluntary Contribution. 1 Ugly Enterprise agrees that it will make a
       voluntary contribution to the United States Treasury in the total
       amount of $5,000.00. This amount was arrived at after careful
       consideration of 1 Ugly Enterprise's claimed inability to pay a large
       voluntary contribution and documentation submitted by 1 Ugly
       Enterprise to the Bureau in support thereof. The total payment shall
       be made within 30 days after the Effective Date. 1 Ugly Enterprise
       shall also send electronic notification of payment to Theresa Z.
       Cavanaugh at [4]Terry.Cavanaugh@fcc.gov and to Brian J. Carter at
       [5]Brian.Carter@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 regarding the form of
       payment:^

   o 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.

   o 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.

   o 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.

   Questions regarding payment procedures should be addressed to the
   Financial Operations Group Help Desk by phone at 1-877-480-3201, or by
   e-mail at [6]ARINQUIRIES@fcc.gov.

   16. Waivers.  1 Ugly Enterprise and Matthew Salazar 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,
       provided the Bureau issues an Adopting Order as defined herein. 1 Ugly
       Enterprise and Matthew Salazar shall retain the right to challenge
       Commission interpretation of the Consent Decree or any terms contained
       herein. If any Party (or the United States on behalf of the
       Commission), brings a judicial action to enforce the terms of the
       Adopting Order, neither 1 Ugly Enterprise, Matthew Salazar nor the
       Commission shall contest the validity of the Consent Decree or of the
       Adopting Order, and 1 Ugly Enterprise and Matthew Salazar shall waive
       any statutory right to a trial de novo. 1 Ugly Enterprise and Matthew
       Salazar hereby agree to waive any claims they may otherwise have under
       the Equal Access to Justice Act^ relating to the matters addressed in
       this Consent Decree.

   17. 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.

   18. 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 the Consent Decree to which 1 Ugly Enterprise and Matthew Salazar do
   not expressly consent) that provision will be superseded by such Rule or
   Commission order.

   19. Successors and Assigns. 1 Ugly Enterprise agrees that the provisions
   of this Consent Decree shall be binding on its successors, assigns, and
   transferees.

   20. Final Settlement.  The Parties agree and acknowledge that this Consent
   Decree shall constitute a final settlement between the Parties with
   respect to the Investigation. The Parties further 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.

   21. Modifications.  This Consent Decree cannot be modified without the
   advance written consent of all 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. Authorized Representative. The individual signing this Consent Decree
   on behalf of 1 Ugly Enterprise represents and warrants that he is
   authorized by 1 Ugly Enterprise to execute this Consent Decree and to bind
   1 Ugly Enterprise to the obligations set forth herein. The FCC signatory
   represents that she is signing this Consent Decree in her official
   capacity and that she is authorized to execute this Consent Decree.

   24. 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.

   By: _____________________________________ By:
   _______________________________

   P. Michele Ellison, Chief Matthew Salazar, individually, and Enforcement
   Bureau on behalf of 1 Ugly Enterprise, LLC

   Federal Communications Commission

   Date: ___________________________________ Date:
   _____________________________

   ^ 47 U.S.C. SS 154(i), 503(b).

   ^ 47 C.F.R. SS 0.111, 0.311.

   ^ 47 C.F.R. S 1.2105(c).

   ^ 47 C.F.R. S 1.2105(c)(1).

   ^ Id. S 1.2105(c)(6).

   ^ Auction of FM Broadcast Construction Permits Scheduled for September 1,
   2009; Comment Sought on Competitive Bidding Procedures For Auction 79,
   Public Notice, 24 FCC Rcd 2589 (2009).

   ^ Auction of FM Broadcast Construction Permits Scheduled for September 1,
   2009; Notice and Filing Requirements, Minimum Opening Bids, Upfront
   Payments and Other Procedures for Auction 79, Public Notice, 24 FCC Rcd
   4448 (2009).

   ^ See FCC Form 175 of 1 Ugly Enterprise, LLC, Application to Participate
   in an FCC Auction, submitted on June 25, 2009 at 2:53 p.m. ET; FCC Form
   175 of Deborah Salazar, Application to Participate in an FCC Auction,
   submitted on June 25, 2009 at 2:52 p.m. ET. 1 Ugly Enterprise and Deborah
   Salazar were classified as eligible to participate in the auction. See
   Auction of FM Broadcast Construction Permits: 77 Bidders Qualified to
   Participate in Auction 79, Public Notice, 24 FCC Rcd 10782 (2009).

   ^ An FCC Form 159 and detailed instructions for completing the form may be
   obtained at http://www.fcc.gov/Forms/Form159/159.pdf.

   ^ Questions regarding payment procedures, it should contact the Financial
   Operations Group Help Desk by phone at 1-877-480-3201, or by e-mail at
   [7]ARINQUIRIES@fcc.gov.

   ^ 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.

   Federal Communications Commission DA 13-684

                                       2

References

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   1. mailto:Terry.Cavanaugh@fcc.gov
   2. mailto:Brian.Carter@fcc.gov
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   4. mailto:Terry.Cavanaugh@fcc.gov
   5. mailto:Brian.Carter@fcc.gov
   6. mailto:ARINQUIRIES@fcc.gov
   7. mailto:ARINQUIRIES@fcc.gov