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Federal Communications Commission FCC 17-140
Before the
Federal Communications Commission
Washington, DC 20554
In the Matter of
Securus Technologies, Inc., et al.
)
)
)
)
)
)
)
File No.: EB-IHD-17-000225128
Acct. No.: 201732080008
FRN: 0006222319
ORDER
Adopted: October 27, 2017 Released: October 30, 2017
By the Commission: Chairman Pai issuing a statement and Commissioners Clyburn and Rosenworcel
dissenting and issuing a joint statement.
1. The Federal Communications Commission (FCC or Commission) has entered into a
Consent Decree to resolve its investigation into whether Securus Technologies, Inc. (Securus or the
Company) and Securus Investment Holdings, LLC, T-NETIX, Inc., T-NETIX Telecommunications
Services, Inc., CellBlox Acquisitions, LLC (collectively, the Securus Entities), failed to make truthful and
accurate statements to the Commission, and maintain the continuing accuracy and completeness of
information furnished to the Commission – in violation of 47 C.F.R §§ 1.17 and 1.65 – regarding State
Regulatory Authority approvals for their pending transfer of control application.1 These rules ensure that
Commission regulatees do not provide the Commission with material factual information that is incorrect
or misleading, or omit material information.
2. On July 26, 2017, Richard A. Smith, the Securus Chief Executive Officer, Manfred
Affenzeller, a Managing Director at Deutsche Bank, and Azra Kanji, a Partner at ABRY Partners, sent a
joint letter to Chairman Ajit Pai stating, “we have received approvals for 48 of 48 state money license
transfer approvals, Hart Scott Rodino Justice Department approval, and all necessary State/PSC/PUC
approvals.”2 However, when the three executives made their representations, four State Regulatory
Authorities had not yet approved the transfer of control.3
3. The Commission must be able to rely on the completeness and accuracy of its regulatees’
submissions. The Company had a statutory and regulatory obligation to accurately report on the status of
the state regulatory approvals that were provided to the Commission. The Company’s failure to
1 See Joint Application of Securus Investment Holdings, LLC, Transferor, Securus Technologies, Inc., Licensee T-
NETIX, Inc., Licensee T-NETIX Telecommunications Services, Inc., Licensee, and SCRS Acquisition Corporation
For Grant of Authority Pursuant to Section 214 of the Communications Act of 1934, as amended, and Sections
63.04 of the Commission’s Rules to Transfer Indirect Ownership and Control of Licensees to SCRS Acquisition
Corporation, WC Docket 17-126 (filed May 11, 2017), ITC-T/C-20170511-00094, ITC-T/C-20170511-00095 (filed
May 11, 2017).
2 Letter from Richard A. Smith, Chief Executive Officer, Securus Technologies, Inc., Manfred Affenzeller, Managing
Director, Deutsche Bank, and Azra Kanji, Partner, ABRY Partners, to The Honorable Ajit Pai, Chairman, Federal
Communications Commission (July 26, 2017).
3 The four pending State Regulatory Authority approvals were in Alaska, California, Mississippi, and Pennsylvania.
Federal Communications Commission FCC 17-140
2
accurately report on these approvals is troubling, but we believe that a Consent Decree is appropriate
based on the totality of the circumstances and the Company’s full cooperation with the Enforcement
Bureau’s investigation.
4. To settle this matter, Securus and the Securus Entities agree to pay a $1,700,000 civil
penalty and to implement a compliance plan to prevent future violations.
5. 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 investigation into the Company’s and Securus Entities’ compliance with Sections 1.17 and
1.65 of the Commission’s rules.4
6. In the absence of material new evidence relating to this matter, we do not set for hearing
the question of Securus’ or the Securus Entities’ basic qualifications to hold or obtain any Commission
license or authorization.5
7. Accordingly, IT IS ORDERED that, pursuant to Sections 4(i) of the Communications
Act, as amended,6 the Consent Decree attached to this Order IS ADOPTED and its terms are
incorporated by reference.
8. IT IS FURTHER ORDERED that the above-captioned matter IS TERMINATED.
9. 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 Dennis Reinhold, Vice President,
General Counsel, and Secretary, Securus Technologies, Inc., 4000 International Parkway, Carrollton, TX
75007; Samuel Rosenthal, Esq., Squire Patton Boggs, LLP, 2550 M Street NW, Washington, D.C. 20037;
and Paul C. Besozzi, Esq., Squire Patton Boggs, LLP, 2550 M Street NW, Washington, D.C. 20037.
FEDERAL COMMUNICATIONS COMMISSION
Marlene H. Dortch
Secretary
4 47 C.F.R. §§ 1.17, 1.65.
5 See 47 C.F.R. § 1.93(b).
6 47 U.S.C. § 154(i).
Federal Communications Commission FCC 17-140
Before the
Federal Communications Commission
Washington, DC 20554
In the Matter of
Securus Technologies, Inc., et al.
)
)
)
)
)
)
)
)
File No.: EB-IHD-17-00025128
Acct. No.: 201732080008
FRN: 0006222319
CONSENT DECREE
1. The Federal Communications Commission (FCC or Commission) and Securus
Technologies, Inc. (Securus or Company) and Securus Investment Holdings, LLC, T-NETIX, Inc., T-
NETIX Telecommunications Services, Inc., CellBlox Acquisitions, LLC (collectively, the Securus
Entities), by their authorized representatives, hereby enter into this Consent Decree for the purpose of
terminating the Enforcement Bureau’s Investigation into whether the Company and the Securus Entities
violated 47 CFR §§ 1.17 and 1.65 regarding the Commission’s requirement that entities subject to the
Commission’s jurisdiction provide accurate and complete information in all representations made to the
Commission and its staff in connection with the Company’s pending transfer of control application.1
I. DEFINITIONS
2. For the purposes of this Consent Decree, the following definitions shall apply:
(a) “Act” means the Communications Act of 1934, as amended.2
(b) “Adopting Order” means an order of the Commission 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) “Commission” and “FCC” mean the Federal Communications Commission and all
of its bureaus and offices.
(e) “Communications Laws” means collectively, the Act, the Rules, and the published
and promulgated orders and decisions of the Commission to which Securus and each
of the Securus Entities are subject by virtue of their business activities.
(f) “Compliance Plan” means the compliance obligations, program, and procedures
described in this Consent Decree at paragraph 13.
1 See Joint Application of Securus Investment Holdings, LLC, Transferor, Securus Technologies, Inc., Licensee T-
NETIX, Inc., Licensee T-NETIX Telecommunications Services, Inc., Licensee, and SCRS Acquisition Corporation
For Grant of Authority Pursuant to Section 214 of the Communications Act of 1934, as amended, and Sections
63.04 of the Commission’s Rules to Transfer Indirect Ownership and Control of Licensees to SCRS Acquisition
Corporation, WC Docket 17-126 (filed May 11, 2017), ITC-T/C-20170511-00094, ITC-T/C-20170511-00095 (filed
May 11, 2017).
2 47 U.S.C. § 151 et seq.
Federal Communications Commission FCC 17-140
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(g) “Covered Employees” means all employees of Securus and the Securus Entities who
perform or directly supervise the performance of duties that relate to Securus’ or the
Securus Entities’ respective responsibilities under the Communications Laws.
(h) “Effective Date” means the date by which all of the following have been
accomplished: the Commission and the Companies have signed the Consent Decree
and the Commission has released the Adopting Order adopting this Consent Decree.
(i) “Investigation” means the investigation commenced by the Bureau in File No. EB-
IHD-17-00025128 regarding whether Securus, the Securus Entities, and/or their
Subsidiaries violated Sections 1.17 and 1.65 of Commission’s Rules.
(j) “Operating Procedures” means the standard internal operating procedures and
compliance policies established by Securus and the Securus Entities to implement
the Compliance Plan.
(k) “Parties” means Securus and each of the Securus Entities and the Commission, each
of which is a “Party.”
(l) “Rules” means the Commission’s regulations found in Title 47 of the Code of
Federal Regulations.
(m) “Securus” means Securus Technologies, Inc., a Delaware corporation, and its
corporate subsidiaries, predecessors-in-interest, and successors-in-interest.
(n) “The Securus Entities” means Securus Investment Holdings, LLC, T-NETIX, Inc.,
T-NETIX Telecommunications Services, Inc., CellBlox Acquisitions, LLC and their
corporate subsidiaries, predecessors-in-interest, and successors-in-interest.
(o) “State Regulatory Authority” means any state governmental agency that has
jurisdiction to approve of or disapprove of the pending transfer of control of Securus
Technologies, Inc., Securus Investment Holdings, LLC, T-NETIX, Inc., T-NETIX
Telecommunications Services, Inc., et. al., to SCRS Acquisition Corporation.
(p) “Subsidiary” means each entity that is subject to the transfer of control application
filed on May 11, 2017, for which Securus or any of the Securus Entities is the parent
company.
II. BACKGROUND
3. The Commission requires all applicants to file accurate and true information in their FCC
transfer of control applications, which the Commission uses to evaluate whether it is appropriate for the
Commission to grant such applications based on the applicants’ basic and other qualifications and
technical capabilities. Section 1.17(a)(2) of the Rules states no one subject to Commission jurisdiction
shall provide in writing any “material factual information that is incorrect or omit material information
that is necessary to prevent any material factual statement that is made from being incorrect or
misleading.”3 Section 1.65(a) of the Rules states that “[e]ach applicant is responsible for the continuing
accuracy and completeness of information furnished in a pending application or in Commission
proceedings involving a pending application.”4
4. On May 11, 2017, Securus filed an application for Commission approval to transfer
multiple Domestic Section 214 and International Section 214 Authorizations from Securus Investment
3 47 C.F.R. § 1.17(a)(2).
4 47 C.F.R. § 1.65(a).
Federal Communications Commission FCC 17-140
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Holdings, LLC to Platinum Equity, LLC in Platinum Equity, LLC’s acquisition of the Company. The
public notice for Securus’ application was released on May 23, 2017.5
5. In a joint letter to Commission Chairman Ajit Pai, dated July 26, 2017, from Richard A.
Smith, Chief Executive Officer of Securus, and certain other participants of the acquisition, the executives
requested Chairman Pai’s help in speeding Commission approval of the Company’s May 11, 2017
transfer of control application. According to Securus, Securus Investment Holdings, LLC and Platinum
Equity, LLC had scheduled a closing date of August 1, 2017, for completing the acquisition, and that
“substantial costs” would be incurred for each day after August 1, 2017.6
6. In the Securus Letter, the Company represented to Chairman Pai that, “we have received
approvals for 48 of 48 state money license transfer approvals, Hart Scott Rodino Justice Department
approval, and all necessary State/PSC/PUC approvals.”7 That statement, however, was not accurate on its
face when it was made because Alaska, California, Mississippi, and Pennsylvania had not yet approved
the transfer of control from Securus Investment Holdings, LLC to Platinum Equity, LLC.8 According to
Securus, what the Company meant with regard to “all necessary State/PSC/PUC approvals” was that all
pre-closing conditions for the acquisition had been met pursuant to the governing transaction agreement.9
Pursuant to the purchase agreement between Securus Investment Holdings, LLC and Platinum Equity,
LLC, closing was conditioned upon the Company receiving State Regulatory Authority approvals from
Georgia, New York, Minnesota, and Pennsylvania. Under the Company’s own interpretation, however, it
was necessary for it to again clarify the record to account for the pendency, as of July 26, 2017, of the
Pennsylvania Public Utility Commission’s (PA PUC) transfer of control approval.10 The PA PUC
subsequently approved the Securus transfer of control component on July 31, 2017.11
7. The Commission and Securus, along with the Securus Entities, desire to resolve this
Investigation and the related disputes without engaging in further litigation on the terms and subject to the
conditions hereinafter set forth.
III. TERMS OF AGREEMENT
8. Adopting Order. The provisions of this Consent Decree shall be incorporated by the
Commission in an Adopting Order.
9. Jurisdiction. Securus and each of the Securus Entities agree that the Bureau has
jurisdiction over it and the matters contained in this Consent Decree and has the authority to enter into
and adopt this Consent Decree.
5 Domestic Section 214 Application Filed for the Transfer of Control of Securus Technologies, Inc., T-NETIX, Inc.,
and T-NETIX Telecommunications Services, Inc. to SCRS Acquisition Corporation, WC Docket No. 17-126, Public
Notice, DA 17-500 (rel. May 23, 2017).
6 Letter from Richard A. Smith, Chief Executive Officer, Securus Technologies, Inc., Manfred Affenzeller, Managing
Director, Deutsche Bank, and Azra Kanji, Partner, ABRY Partners, to The Honorable Ajit Pai, Chairman, Federal
Communications Commission (July 26, 2017) (Securus Letter)
7 See Securus Letter.
8 Response to Letter of Inquiry from Paul C. Besozzi, Counsel to Securus Investment Holdings, LLC, Securus
Technologies, Inc., T-NETIX, Inc. and T-NETIX Telecommunications Services, Inc., to Marlene H. Dortch,
Secretary, Federal Communications Commission at 13 (September 8, 2017) (on file in EB-IHD-17-00025128)
(Securus LOI Response). As of September 8, 2017, the Alaska approval was still pending, the California approval
was completed on August 24, 2017, the Mississippi approval was completed on August 1, 2017, and the
Pennsylvania approvals were completed on June 5, 2017, and July 31, 2017.
9 Securus LOI Response at 9.
10 Id.
11 Id.
Federal Communications Commission FCC 17-140
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10. 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 Parties agree that this
Consent Decree shall have the same force and effect as any other order of the Commission.
11. Termination of Investigation. In express reliance on the covenants and representations
in this Consent Decree and to avoid further expenditure of public resources, the Commission agrees to
terminate the Investigation. In consideration for the termination of the Investigation, Securus and the
Securus Entities, on behalf of each Subsidiary, each agrees to the terms, conditions, and procedures
contained herein. The Commission further 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 new proceeding, formal or informal, or take any
action on its own motion against Securus or the Securus Entities concerning the matters that were the
subject of the Investigation. The Commission 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 to set for hearing
the question of basic qualifications of Securus or the Securus Entities to be a Commission licensee or hold
Commission licenses or authorizations.12
12. Compliance Officer. Within thirty (30) calendar days after the Effective Date, Securus
and the Securus Entities each shall provide the contact information for a senior corporate manager with
the requisite corporate and organizational authority who serves as a Compliance Officer and who
discharges the duties set forth below. The person designated as a Compliance Officer shall be responsible
for developing, implementing, and administering the Compliance Plan and ensuring that Securus or the
Securus Entities, as the case may be, 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 or her duties under this Consent Decree, the Compliance Officer shall have specific
knowledge of the Rules applicable to the Company’s written communications with the Commission,
including 47 C.F.R. §§ 1.17 and 1.65, prior to assuming his or her duties.
13. Compliance Plan. Securus and the Securus Entities each agree that they shall, within
thirty (30) calendar days after the Effective Date, develop and implement a Compliance Plan designed to
ensure future compliance with the Communications Laws, including 47 C.F.R. §§ 1.17 and 1.65, and with
the terms and conditions of this Consent Decree. With respect to future communications with the
Commission and its staff, Securus and the Securus Entities each will implement, at a minimum, the
following procedures:
(a) Operating Procedures. Within sixty (60) calendar days after the Effective Date,
Securus and the Securus Entities shall establish Operating Procedures that all
Covered Employees must follow to help ensure Securus’ and the Securus Entities’
compliance with 47 C.F.R. §§ 1.17 and 1.65. Securus’ and the Securus Entities’
Operating Procedures shall include, at a minimum, the following provisions: (i) no
proposed written statement shall be submitted to or filed with the Commission by
any Covered Employee unless such statement or submission is first reviewed and
approved by each Securus Entity’s internal legal counsel and such approval is duly
noted on the proposed written communication; and (ii) unless otherwise expressly
approved by each Securus Entity’s internal legal counsel or for routine reporting or
other submissions listed in the Compliance Manual, all documentation submitted to
the Commission should only be submitted by each Securus Entity’s internal or
designated outside legal counsel.
(b) Compliance Manual. Within sixty (60) calendar days after the Effective Date, the
Compliance Officer shall develop and distribute a Compliance Manual to all
12 See 47 CFR 1.93(b).
Federal Communications Commission FCC 17-140
5
Covered Employees. The Compliance Manual shall set forth 47 C.F.R. §§ 1.17 and
1.65, together with the Operating Procedures that Covered Employees shall follow
to help ensure each Securus Entity’s compliance with those Rules. Each Securus
Entity shall periodically review and revise the Compliance Manual as necessary to
ensure that the information set forth therein remains current and accurate. Securus
and the Securus Entities shall distribute any revisions to the Compliance Manual
promptly to all Covered Employees.
(c) Compliance Training Program. Securus and the Securus Entities shall establish
and implement a Compliance Training Program to ensure compliance with 47
C.F.R. §§ 1.17 and 1.65 and the Operating Procedures. As part of the Compliance
Training Program, Covered Employees shall be advised of each Securus Entity’s
obligation to report any noncompliance with 47 C.F.R. §§ 1.17 and 1.65 under
paragraph 14 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 initial Compliance Training Program shall be trained within thirty (30)
calendar days after the date such person becomes a Covered Employee. Securus and
the Securus Entities shall repeat 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.
14. Reporting Noncompliance. Securus and the Securus Entities shall report any
noncompliance with Sections 1.17 and/or 1.65 of the Rules occurring after the Effective Date 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 Securus or the Securus Entities, as the case may be, 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 the Securus or the Securus Entities, as the case may be, has taken or will take to prevent the
recurrence of any such noncompliance. All reports of noncompliance shall be submitted to Chief,
Investigations and Hearings Division, Enforcement Bureau, Federal Communications Commission, 445
12th Street, SW, Washington, DC 20554, with a copy submitted electronically to Jeffrey J. Gee at
Jeffrey.Gee@fcc.gov and Greg Haledjian at Gregory.Haledjian@fcc.gov.
15. Compliance Reports. Securus and the Securus Entities shall file compliance reports
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.
(a) Each Compliance Report shall include a detailed description of efforts made by
Securus and the Securus Entities during the relevant period to comply with the terms
and conditions of this Consent Decree and Sections 1.17 and 1.65 of the Rules. In
addition, each Compliance Report shall include a certification by the Compliance
Officer, as an agent of and on behalf of Securus or the Securus Entities, as the case
may be, stating that the Compliance Officer has personal knowledge that Securus or
the Securus Entities: (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 14 of this Consent Decree.
(b) The Compliance Officer’s certification shall be accompanied by a statement
explaining the basis for such certification and shall comply with Section 1.16 of the
Federal Communications Commission FCC 17-140
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Rules and be subscribed to as true under penalty of perjury in substantially the form
set forth therein.13
(c) If the Compliance Officer cannot provide the requisite certification, the Compliance
Officer, as an agent of and on behalf of Securus or the Securus Entities, 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 Securus or the
Securus Entities 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
Securus or the Securus Entities 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 Chief, Investigations and Hearings
Division, Enforcement Bureau, Federal Communications Commission, 445 12th
Street, SW, Washington, DC 20554, with a copy submitted electronically to Jeffrey
J. Gee at Jeffrey.Gee@fcc.gov and Greg Haledjian at Gregory.Haledjian@fcc.gov.
16. Termination Date. Unless stated otherwise, the requirements set forth in paragraphs 12
through 15 of this Consent Decree shall expire thirty-six (36) months after the Effective Date.
17. Civil Penalty. Securus and the Securus Entities will pay a civil penalty, for which they
are jointly and severally liable, to the United States Treasury in the amount of $1,700,000 within thirty
(30) calendar days of the Effective Date. Securus and the Securus Entities shall send electronic
notification of payment to Jeffrey J. Gee at Jeffrey.Gee@fcc.gov and Greg Haledjian at
Gregory.Haledjian@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 Account Number and FRN
referenced above. Regardless of the form of payment, a completed FCC Form 159 (Remittance Advice)
must be submitted.14 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 that should be followed based on the form of payment selected:
· 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.
13 47 CFR § 1.16.
14 An FCC Form 159 and detailed instructions for completing the form may be obtained at
http://www.fcc.gov/Forms/Form159/159.pdf.
Federal Communications Commission FCC 17-140
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Questions regarding payment procedures should be addressed to the Financial Operations Group
Help Desk by phone, 1-877-480-3201, or by e-mail, ARINQUIRIES@fcc.gov.
18. Waivers. As of the Effective Date, Securus and the Securus Entities each 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. Securus and
the Securus Entities 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 Consent Decree or the Adopting Order, neither Securus, the
Securus Entities, nor the Commission shall contest the validity of the Consent Decree or the Adopting
Order, and Securus and the Securus Entities shall waive any statutory right to a trial de novo. Securus and
the Securus Entities each hereby agrees to waive any claims it may otherwise have under the Equal
Access to Justice Act15 relating to the matters addressed in this Consent Decree.
19. Severability. The Parties agree that if any of the provisions of the Consent Decree shall
be held unenforceable by any court of competent jurisdiction, such unenforceability shall not render
unenforceable the entire Consent Decree, but rather the entire Consent Decree shall be construed as if not
containing the particular unenforceable provision or provisions, and the rights and obligations of the
Parties shall be construed and enforced accordingly.
20. 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.
21. 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 Securus and the Securus Entities
do not expressly consent) that provision will be superseded by such Rule or Order.
22. Successors and Assigns. Securus and the Securus Entities each agrees that the
provisions of this Consent Decree shall be binding on its successors, assigns, and transferees.
23. 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 and shall not be construed as either an adjudication on
the merits or a factual or legal finding or determination regarding any compliance or noncompliance with
the requirements of the Communications Laws. The Parties also agree that this Consent Decree does not
constitute an admission of liability by the Company or the Securus Entities or a concession by the
Commission that its Investigation was not well-founded.
24. Modifications. This Consent Decree cannot be modified without the advance written
consent of all Parties.
25. 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.
26. Authorized Representative. Each Party represents and warrants to the other that it has
full power and authority to enter into this Consent Decree. Each person signing this Consent Decree on
behalf of a Party hereby represents that he or she is fully authorized by the Party to execute this Consent
Decree and to bind the Party to its terms and conditions.
15 See 5 U.S.C. § 504; 47 CFR §§ 1.1501–1.1530.
Federal Communications Commission FCC 17-140
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27. Counterparts. This Consent Decree may be signed in counterpart (including
electronically or by facsimile). Each counterpart, when executed and delivered, shall be an original, and
all of the counterparts together shall constitute one and the same fully executed instrument.
________________________________ ________________________________
Rosemary C. Harold Date
Chief
Enforcement Bureau
________________________________ ________________________________
Richard A. Smith Date
Chief Executive Officer
Securus Technologies, Inc.
On behalf of:
Securus Technologies, Inc.
Securus Investment Holdings, LLC
T-NETIX, Inc.
T-NETIX Telecommunications Services, Inc.
CellBlox Acquisitions, LLC
Federal Communications Commission FCC 17-140
9
STATEMENT OF
CHAIRMAN AJIT PAI
Re: Joint Application of Securus Investment Holdings, LLC, Securus Technologies, Inc., T-NETIX,
Inc. and SCRS Acquisition Corporation for Grant of Authority Pursuant to Section 214 of the
Communications Act of 1934, as Amended, and Sections 63.04 and 63.24 of the Commission’s
Rules to Transfer Indirect Ownership and Control of Licensees, WC Docket No. 17-126; Securus
Technologies, Inc., et al., File No.: EB-IHD-17-000225128
This action could have occurred months ago. Yet one of the Applicants chose to misrepresent
facts to the Commission. A lack of candor with the Commission is a very serious matter, and there must
be a strong deterrent to such misconduct.
So as we approve this transaction from which we find no competitive harms, we also have a
consent decree with Securus that both punishes its untruthfulness and serves as a strong deterrent to others
who would mislead the agency.
I believe the purpose of this misrepresentation was to speed the approval of this transaction. But
it ended up having the opposite effect. Those doing business in front of the agency should take note of
that fact. They should also note that while Applicants urged quick approval to avoid incurring fees, in the
companion decree Securus will pay a civil penalty of $1.7 million because of their lack of candor, a
particularly large amount for this type of violation.
Lastly, it’s important to understand that none of the conditions that it’s been suggested we impose
here are transaction-specific — that is they having nothing to do with remedying a transaction-specific
harm. And as the standard of review in this document makes clear, a transaction is not an opportunity to
apply extraneous conditions upon a licensee.
Federal Communications Commission FCC 17-140
10
JOINT DISSENTING STATEMENT OF COMMISSIONERS
MIGNON L. CLYBURN AND JESSICA ROSENWORCEL
Re: Joint Application of Securus Investment Holdings, LLC, Securus Technologies, Inc, T-NETIX,
Inc., T-NETIX Telecommunications Services, Inc. and SCRS Acquisition Corporation for Grant of
Authority Pursuant to Section 214 of the Communications Act of 1934, as Amended, and Sections
63.04 and 63.24 of the Commission’s Rules to Transfer Indirect Ownership and Control of
Licensees, WC Docket No. 17-126; Securus Technologies, Inc., et al., File No.: EB-IHD-17-
000225128
Today, the FCC’s majority gives its blessing to an approximately $1.6 billion deal involving
Securus, one of the nation’s largest providers of inmate calling services. This is the same company that
attempted to mislead the Chairman into prematurely granting its transaction. For violating our rules, and
our trust, the Commission also adopts a consent decree that is worth:
· 0.1% of the value of the transaction;
· 0.39% of the company’s 2015 revenues; and
· 0.12% of the kickbacks Securus paid to correctional facilities from 2004-2014.
To give an idea of how relatively small this penalty is, consider that we routinely fine companies up to
several percent of their gross annual revenues for egregious infractions of our rules.
But to anyone familiar with how this company operates, this is unsurprising. It is a company that
has shown it is willing to operate on the bleeding edge of legality when it comes to this agency’s rules.
For example, when the FCC banned connection fees, this company simply renamed them “first minute
rates” and continued to charge them. This is unacceptable and wrong.
Is this transfer of control and consent decree just a slap on the wrist? More like a pat on the back.
And it is precedent-setting. Until now, the FCC has never granted a transfer of control when a company
has made misrepresentations during the review process. We could have adopted conditions on the
transaction to mitigate public interest harms. Indeed, we suggested several, but the Chairman respectfully
declined to act on any of them, including a condition to ensure that the company could not decline to
serve incarcerated people with disabilities.
When it comes to the plight of prisoners and their families paying usurious rates for phone
service, the current leadership of the Commission has not made a single move to help. Instead, we’ve seen
a string of half-hearted words that add up to a refusal by the Commission to do its job under the law. This
Commission is failing in its duty to protect prisoners and their families from usurious phone rates.
***
Unfortunately, disregard for inmates and their families is not the only thing wrong with this item.
The Communications Act instructs the Commission to consider the public interest when it
reviews a transaction. A deeply-rooted preference to protect and promote competition in relevant markets,
accelerate deployment of advanced services, ensure a diversity of license holdings, and manage spectrum
in the public interest, have traditionally been a part of this consideration. However, today’s item sets an
ominous precedent by narrowing the Commission’s standard of review to effectively take the public
interest out of the equation. By doing so, we shirk our responsibility under the Act.
For all of the above reasons, we dissent.