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Forfeiture Proposed for USF and Other Violations

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Released: December 5, 2011

Federal Communications Commission

FCC 11-180

Before the

Federal Communications Commission

Washington, D.C. 20554

In the Matter of
)
)

Kajeet, Inc.
)
File No. EB-09-IH-1972
)
and
)
NAL/Acct. No. 201232080007
)
FRN 0019614908
Kajeet/Airlink, LLC
)
)

Apparent Liability for Forfeiture
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NAL/Acct. No. 201232080008
)
FRN 0018691477

NOTICE OF APPARENT LIABILITY FOR FORFEITURE AND ORDER

Adopted: December 5, 2011

Released: December 5, 2011

By the Commission:

I.

INTRODUCTION

1.
In this Notice of Apparent Liability for Forfeiture and Order (“NAL”), we find that
Kajeet, Inc. (“Kajeet”) and its wholly-owned subsidiary Kajeet/Airlink, LLC (“Kajeet/Airlink”)
(collectively, the “Companies”) apparently violated sections 225(b)(1), 251(e)(2), and 254(d) of the
Communications Act of 1934, as amended (the “Act”),1 and sections 52.32(a), 54.706(a), and
64.604(c)(5)(iii)(A) of the Commission’s rules,2 by apparently willfully and repeatedly failing to
contribute fully and timely to the Universal Service Fund (“USF”), the Telecommunications Relay
Service (“TRS”) Fund, and the Local Number Portability (“LNP”) cost recovery mechanism. In addition,
we find that Kajeet/Airlink apparently violated section 214 of the Act and section 63.24 of the
Commission’s rules,3 by apparently willfully consummating an unauthorized assignment of an
international section 214 authorization. Based on our review of the facts and circumstances surrounding
this matter, and for the reasons discussed below, we find that Kajeet is apparently liable for a total
forfeiture of four hundred sixty thousand, one hundred eighty-six dollars ($460,186) and Kajeet/Airlink is
apparently liable for a total forfeiture of five hundred two thousand, six hundred forty-two dollars
($502,642).
2.
We also order the Companies to submit within thirty (30) calendar days a
report―supported by a declaration under penalty of perjury from a corporate officer―setting forth in
detail their plans to come into compliance with the payment obligations discussed herein and describing
the steps Kajeet/Airlink has taken to come into compliance with the requirements of section 214 of the
Act and section 63.24 of the Commission’s rules.


1 47 U.S.C. §§ 225(b)(1), 251(e)(2), 254(d).
2 47 C.F.R. §§ 52.32(a), 54.706(a), 64.604(c)(5)(iii)(A).
3 47 U.S.C. § 214; 47 C.F.R. § 63.24.

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FCC 11-180

II.

BACKGROUND

3.
The Act codifies Congress’s historic commitment to promote universal
telecommunications service to ensure that consumers in all regions of the nation have access to
affordable, quality telecommunications services. In particular, section 254(d) of the Act requires, among
other things, that “[e]very telecommunications carrier [providing] interstate telecommunications services
… contribute, on an equitable and nondiscriminatory basis, to the specific, predictable, and sufficient
mechanisms established by the Commission to preserve and advance universal service.”4 In
implementing this Congressional mandate, the Commission directed all telecommunications carriers
providing interstate telecommunications services and certain other providers of interstate
telecommunications to register with the Commission, comply with annual and quarterly filing
requirements, and contribute to the Universal Service Fund based on their interstate and international end-
user telecommunications revenues.5 The Universal Service Administrative Company (“USAC”) currently
administers the USF.6 USAC uses the revenue projections submitted on the quarterly filings to determine
each carrier’s monthly universal service contribution amount, and bills them accordingly each month.7
Consistent with the Debt Collection Improvement Act of 1996 (“DCIA”),8 invoices for USF contributions
that have become over 90 days delinquent are transferred to the Commission for further action to collect
the outstanding debt.9 A provider’s failure to pay its share into the USF skews the playing field by giving
the provider an economic advantage over its competitors, who must then shoulder more than their fair
share of the costs of universal service.
4.
Section 225(b)(1) of the Act, which codifies Title IV of the Americans with Disabilities
Act of 1990, directs the Commission to “ensure that interstate and intrastate telecommunications relay
services are available, to the extent possible and in the most efficient manner, to hearing-impaired and
speech-impaired individuals in the United States.”10 To that end, the Commission established the TRS
Fund to reimburse TRS providers for the costs of providing interstate telecommunications relay services.11


4 47 U.S.C. § 254(d).
5 47 C.F.R. §§ 54.706(b), 54.711, 64.1195. See also 47 U.S.C. § 254(d) (“Any other provider of interstate
telecommunications may be required to contribute to the preservation and advancement of universal service if the
public interest so requires.”). Contributions are based on a contributor’s projected revenues, and individual
universal service contribution amounts that are based on quarterly filings are subject to an annual true-up. 47 C.F.R.
§ 54.709(b).
6 47 C.F.R. § 54.701(a).
7 See 47 C.F.R. § 54.709.
8 See Debt Collection Improvement Act of 1996, Pub. L. No. 104-134, 110 Stat. 1321, 1358 (1996). Pursuant to the
“red light rule,” the Commission withholds action on applications or other requests for benefits by delinquent
debtors and ultimately dismisses such applications or other requests if the delinquency is not resolved. See 47
C.F.R. § 1.1910.
9 See http://www.universalservice.org/fund-administration/contributors/understanding-your-invoice/important-
invoicing-deadlines.aspx. Debt collection procedures may include further administrative efforts both by the
Commission and the United States Treasury or, as appropriate, the Commission may refer the delinquent debt to the
Department of Justice for enforced collection action. 47 C.F.R. § 1.1917. Collection efforts may result in additional
charges, to include interest and penalties, as provided under 31 U.S.C. § 3717, and administrative charges pursuant
to 47 C.F.R. §§ 1.1940, 54.713, and 31 C.F.R. § 285.12(j).
10 47 U.S.C. § 225(b)(1).
11 See Telecommunications Relay Services and the Americans with Disabilities Act of 1990, Third Report and Order,
8 FCC Rcd 5300, 5301 ¶ 7 (1993). Telecommunications relay services enable persons with hearing and speech
disabilities to communicate by telephone with voice-telephone users. Such services provide telephone access to a
(continued …)
2

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FCC 11-180

Pursuant to sections 64.604(c)(5)(iii)(A) and 64.601(b) of the Commission’s rules, every provider of
interstate telecommunications services and certain other providers of telecommunications must contribute
to the TRS Fund based on their interstate end-user revenues.12 The TRS Fund administrator uses the
annual filings to determine each contributor’s TRS Fund contribution amount.13 The TRS Fund
administrator bills carriers each July based on their annual revenues.14
5.
In addition, section 251(e)(1) of the Act directs the Commission to oversee the
administration of telecommunications numbering to ensure the availability of telephone numbers on an
equitable basis.15 Section 251(e)(2) of the Act requires that “[t]he cost of establishing telecommunications
numbering administration arrangements … shall be borne by all telecommunications carriers on a
competitively neutral basis as determined by the Commission.”16 In carrying out this statutory directive,
the Commission adopted section 52.32 of its rules, which requires, among other things, that all
telecommunications carriers contribute to the costs of local number portability on the basis of their end-
user telecommunications revenues for the prior calendar year.17
6.
The Commission has established specific procedures for the administration of the USF,
TRS, local number portability, and other associated federal regulatory programs. Pursuant to section
54.711(a) of the Commission’s rules,18 a carrier is required to file FCC Form 499-A, also known as the
annual Telecommunications Reporting Worksheet (“annual Worksheet” or “Form 499-A”),19 for the
purpose of determining its USF, TRS Fund, LNP, and North American Numbering Plan (“NANP”)
administration and regulatory fee payments, and with certain exceptions, to file Quarterly
Telecommunications Reporting Worksheets (“quarterly Worksheet” or “Form 499-Q”) to determine its
monthly universal service contribution amounts.20 These periodic filings trigger a determination of
liability, if any, and subsequent billing and collection by the entities that administer the regulatory
programs.21 Carriers must pay their contribution invoices in a timely manner,22 and the Commission’s
(Continued from previous page)


significant number of Americans who, without it, might not be able to make calls to or receive calls from voice-
telephone users. See Telecommunications Relay Services and Speech-to-Speech Services for Individuals with
Hearing and Speech Disabilities
, Report and Order, 15 FCC Rcd 5140, 5143 ¶ 5 (2000).
12 47 C.F.R. §§ 64.604(c)(5)(iii)(A), 64.601(b).
13 47 C.F.R. § 64.604(c)(5)(iii)(B).
14 Rolka Loube Saltzer Associates, LLC replaced the National Exchange Carrier Association as the TRS Fund
administrator effective July 1, 2011. See http://www.r-l-s-a.com/TRS/.
15 47 U.S.C. § 251(e)(1).
16 47 U.S.C. § 251(e)(2).
17 47 C.F.R. § 52.32.
18 47 C.F.R. § 54.711(a).
19 See FCC Form 499-A Telecommunications Reporting Worksheet − Annual Filing,
http://transition.fcc.gov/Forms/Form499-A/499a2-2011.pdf (October 2011).
20 See Federal-State Joint Board on Universal Service, Petition for Reconsideration filed by AT&T, Report and
Order and Order on Reconsideration, 16 FCC Rcd 5748 (2001). Carriers report their revenues for the prior quarter
by the beginning of the second month in each quarter (i.e., February 1, May 1, August 1, and November 1). See id.
at 5755, ¶ 19. See also FCC Form 499-Q Telecommunications Reporting Worksheet − Quarterly Filing for
Universal Service Contributors
, http://www.fcc.gov/Forms/Form499-Q/499q.pdf (April 2010).
21 See 47 C.F.R. § 54.709. See also 47 C.F.R. §§ 52.32, 64.604(c)(5)(iii)(B).
3

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FCC 11-180

rules explicitly warn contributors that failure to file forms or submit payments potentially subjects them to
enforcement action.23
7.
Section 214(a) of the Act prohibits any carrier from constructing, extending, or operating
any line, and from engaging in transmission through any such line, “unless and until there shall first have
been obtained from the Commission a certificate that the present or future public convenience and
necessity” require, or will require, the construction, extension, or operation of the line.24 In accordance
with sections 63.12 and 63.18 of the Commission’s rules, any international carrier seeking authorization
for such activities pursuant to section 214 of the Act, including an assignment of an authorization, must
obtain approval from the Commission.25 In particular, pursuant to section 63.24 of the Commission's
rules,26 the assignment of an international section 214 authorization requires application to, and prior
approval from, the Commission. Section 63.24(e) requires that the proposed assignee apply to the
Commission for approval prior to the consummation of the proposed assignment.27 The Commission
employs a public interest standard under section 214(a) of the Act that involves the examination of the
positive and negative public interest impact of a proposed transaction.28
8.
Kajeet is a Maryland-based company that has provided telecommunications services
since 2007.29 Kajeet provides prepaid wireless services as reseller for a nationwide wireless carrier.30
(Continued from previous page)


22 See 47 C.F.R. § 54.711(a) (“The Commission shall announce by Public Notice published in the Federal Register
and on its website the manner of payment and the dates by which payments must be made.”); Proposed Fourth
Quarter 2011 Contribution Factor, Public Notice, 26 FCC Rcd 12943, 12946 (Managing Dir. 2011) (“Contribution
payments are due on the date shown on the invoice.”). See also 47 C.F.R. § 54.713(b) (noting that if a USF
“contributor fails to make full payment on or before the date due of … the monthly invoice provided by the
Administrator, the payment is delinquent.”). The Act and our rules, however, do not condition payment on receipt
of an invoice or other notice from USAC. See 47 U.S.C. § 254(d); 47 C.F.R. § 54.706(b). A carrier that does not
file required worksheets may not receive an invoice from USAC, but is nonetheless required to contribute to the
USF, unless its revenues are considered de minimis. See Globcom, Inc., Notice of Apparent Liability for Forfeiture
and Order, 18 FCC Rcd 19893, 19896 ¶ 5 n.22 (2003) (“Globcom NAL”) (subsequent history omitted). The
instructions for the Worksheets include tables for carriers to determine their annual contributions. Providers whose
annual contribution is less than $10,000 are considered de minimis and exempted from contributing to the USF. See
also
47 C.F.R. § 54.708.
23 47 C.F.R. § 54.713.
24 47 U.S.C. § 214(a).
25 47 C.F.R. §§ 63.12, 63.18.
26 47 C.F.R. § 63.24. For purposes of section 63.24 of the Commission’s rules, “an assignment of an authorization is
a transaction in which the authorization is assigned from one entity to another entity. Following an assignment, the
authorization is held by an entity other than the one to which it was originally granted.” 47 C.F.R. § 63.24(b).
27 47 C.F.R. § 63.24(e); see also 47 C.F.R. § 63.24(d) (excluding pro forma applications, or non-substantial
assignments and transfers of control that do not result in a change in the actual controlling party or do not require
prior Commission approval) and Note 1 to paragraph (d) (listing the factors relevant to a determination of control).
28 See 47 U.S.C. § 214(a).
29 Response of Kajeet, Inc. and Kajeet/Airlink, LLC to the Enforcement Bureau’s December 10, 2009 Letter of
Inquiry
, dated February 28, 2010, at response to Question 3 (“LOI Response”).
30 Id. at response to Questions 3 and 9. Most of the customers of Kajeet’s prepaid wireless service are children and
the ability to make international calls from Kajeet handsets has been disabled from all of Kajeet handsets. Because
Kajeet offers no international telecommunications services, it does not hold an international section 214
authorization. Id. at response to Question 12.
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FCC 11-180

Kajeet/Airlink has provided telecommunications services since April 2009.31 Kajeet/Airlink provides
prepaid wireless services as a reseller for a nationwide wireless carrier and sells prepaid long distance
calling cards.32
9.
In July 2009, USAC referred Airlink Mobile, Inc. (“Airlink Mobile”) to the Enforcement
Bureau (the “Bureau”) for potential enforcement action, alleging that Airlink Mobile had failed to comply
with the Commission’s USF contribution rules. On August 10, 2009, the Bureau issued a letter of inquiry
(“LOI”) to Airlink Mobile seeking information about its compliance with USF and other related
regulatory obligations.33 Airlink Mobile did not respond to the LOI. Subsequent investigation revealed
that Airlink Mobile was no longer in business and that its assets had apparently been purchased by the
Companies. On December 10, 2009, the Bureau issued an LOI to the Companies seeking information
about their compliance with USF and other related regulatory obligations and Kajeet/Airlink LLC’s
acquisition of certain assets of Airlink Mobile.34 The LOI Response and supplemental information
developed through our investigation indicate that both Kajeet and Kajeet/Airlink failed to contribute fully
and timely to the USF, the TRS Fund, and the LNP cost recovery mechanism.35 In addition, the LOI
Response indicates that Kajeet/Airlink consummated a substantial assignment of an international section
214 authorization without prior Commission approval.36


31 Id. at response to Question 10.
32 Id. at response to Question 9.
33 Letter from Trent B. Harkrader, Deputy Chief, Investigations & Hearings Division, Enforcement Bureau, FCC, to
David Stanek, Chief Executive Officer, Airlink Mobile, Inc.
, dated August 10, 2009.
34 Letter from Trent B. Harkrader, Deputy Chief, Investigations & Hearings Division, Enforcement Bureau, FCC, to
Daniel Neal, Chief Executive Officer, Kajeet Inc. and Kajeet/Airlink LLC
, dated December 10, 2009 (“LOI”).
35 See LOI Response at response to Question 18; see also Email from Stefani Watterson, USAC, to Kathy Berthot,
Attorney-Advisor, Investigations and Hearings Division, Enforcement Bureau, FCC, dated December 16, 2010
(attaching USAC invoices and billing history for Kajeet and Kajeet/Airlink) (“First Watterson Email”); Email from
Stefani Watterson, USAC, to Kathy Berthot, Attorney-Advisor, Investigations and Hearings Division, Enforcement
Bureau, FCC, dated February 15, 2011 (attaching USAC invoices for Kajeet and Kajeet/Airlink) (“Second
Watterson Email”); Email from Kristin Berkland, USAC, to Kathy Berthot, Attorney-Advisor, Investigations and
Hearings Division, Enforcement Bureau, FCC, dated October 26, 2011 (“Berkland Email”); Email from Marina
Aparicio, NECA, to Kathy Berthot, Attorney-Advisor, Investigations and Hearings Division, Enforcement Bureau,
FCC, dated January 7, 2011 (attaching NECA invoices and payment history for Kajeet and Kajeet/Airlink)
(“Aparicio Email”); Email from Karen Laffey, Neustar, Inc., to Kathy Berthot, Attorney-Advisor, Investigations and
Hearings Division, Enforcement Bureau, FCC, dated January 24, 2011 (“First Laffey Email”); Email from Karen
Laffey, Neustar, Inc., to Kathy Berthot, Attorney-Advisor, Investigations and Hearings Division, Enforcement
Bureau, FCC, dated October 26, 2011 (“Second Laffey Email”).
36 See LOI Response at response to Questions 10, 12, Attachment C. The Companies requested confidential
treatment of “all of the materials provided herein by Kajeet, which relates specifically to the acquisition of certain
assets by Kajeet/Airlink LLC.” Id. at 1. Accordingly, the details concerning Kajeet/Airlink’s acquisition of certain
assets of Airlink Mobile are discussed in an Appendix hereto, and we are treating the Appendix as confidential at
this time. 47 C.F.R. § 0.459(d)(3) (“The Commission may defer acting on requests that materials or information
submitted to the Commission be withheld from public inspection until a request for inspection has been made
pursuant to § 0.460 or § 0.461. The information will be accorded confidential treatment … until the Commission
acts on the confidentiality request and all subsequent appeal and stay proceedings have been exhausted.”).
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FCC 11-180

III.

DISCUSSION

10.
Under section 503(b)(1) of the Act, any person who is determined by the Commission to
have willfully or repeatedly failed to comply with any provision of the Act or any rule, regulation, or
order issued by the Commission shall be liable to the United States for a forfeiture penalty.37 Section
312(f)(1) of the Act defines willful as “the conscious and deliberate commission or omission of [any] act,
irrespective of any intent to violate” the law.38 The legislative history to section 312(f)(1) of the Act
clarifies that this definition of willful applies to both sections 312 and 503(b) of the Act,39 and the
Commission has so interpreted the term in the section 503(b) context.40 The Commission may also assess
a forfeiture for violations that are merely repeated, and not willful.41 “Repeated” means that the act was
committed or omitted more than once, or lasts more than one day.42 To impose such a forfeiture penalty,
the Commission must issue a notice of apparent liability, and the person against whom the notice has
been issued must have an opportunity to show, in writing, why no such forfeiture penalty should be
imposed.43 The Commission will then issue a forfeiture if it finds, based on the evidence, that the person
has violated the Act or a Commission rule.44
11.
The fundamental issues in this case are whether Kajeet and Kajeet/Airlink apparently
violated the Act and the Commission’s rules by willfully or repeatedly failing to make required
contributions to the USF, TRS Fund, and LNP cost recovery mechanism, and whether Kajeet/Airlink
apparently violated the Act and the Commission’s rules by willfully or repeatedly failing to obtain
Commission approval prior to consummating the assignment of an international section 214
authorization. We answer these questions in the affirmative. As set forth below, we conclude that the
Companies are apparently liable for a forfeiture for their apparent willful and repeated violations of
sections 214, 225(b)(1), 251(e)(2), and 254(d) of the Act45 and sections 52.32(a), 54.706(a), 63.24, and
64.604(c)(5)(iii)(A) of the Commission’s rules.46 Based on the facts and circumstances before us, we
therefore conclude that Kajeet is apparently liable for a total forfeiture of four hundred sixty thousand,
one hundred eighty-six dollars ($460,186) and Kajeet/Airlink is apparently liable for a total forfeiture of
five hundred two thousand, six hundred forty-two dollars ($502,642).


37 47 U.S.C. § 503(b)(1)(B); 47 C.F.R. § 1.80(a)(1).
38 47 U.S.C. § 312(f)(1).
39 H.R. Rep. No. 97-765, 97th Cong. 2d Sess. 51 (1982).
40 See, e.g., Southern California Broadcasting Co., Memorandum Opinion and Order, 6 FCC Rcd 4387, 4388, ¶ 5
(1991) (“Southern California Broadcasting”).
41 See, e.g., Callais Cablevision, Inc., Notice of Apparent Liability for Monetary Forfeiture, 16 FCC Rcd 1359,
1362, ¶ 10 (2001) (“Callais Cablevision”) (issuing an NAL for, inter alia, a cable television operator’s repeated
violation of the cable signal leakage rules).
42 Southern California Broadcasting, 6 FCC Rcd at 4388 ¶ 5; Callais Cablevision, 16 FCC Rcd at 1362 ¶ 9.
43 47 U.S.C. § 503(b); 47 C.F.R. § 1.80(f).
44 See, e.g., SBC Communications, Inc., Forfeiture Order, 17 FCC Rcd 7589, 7591 ¶ 4 (2002).
45 47 U.S.C. §§ 214, 225(b)(1), 251(e)(2), 254(d).
46 47 C.F.R. §§ 52.32(a), 54.706(a), 63.24, 64.604(c)(5)(iii)(A).
6

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FCC 11-180

A.

Kajeet and Kajeet/Airlink Apparently Failed to Make Full and Timely
Universal Service Fund Contributions

12.
We conclude that Kajeet and Kajeet/Airlink both apparently violated section 254(d) of
the Act and section 54.706(a) of the Commission’s rules by apparently willfully and repeatedly failing to
contribute fully and timely to the universal service support mechanisms.47 Section 54.706(a) of the
Commission’s rules unambiguously directs that “entities [providing] interstate telecommunications to the
public … for a fee … contribute to the universal service support mechanisms.”48 “Interstate
telecommunications” include, among other things, “resale of interstate services” and “prepaid calling
card” services such as those provided by Kajeet and Kajeet/Airlink.49 The Companies do not dispute that
Kajeet and Kajeet/Airlink were required to make USF contributions at all relevant times.50
13.
Kajeet made only partial payments on its USF invoice for the monthly payments due in
May 2009, January 2010, and January 2011, and failed to make any of the required monthly payments
due in June 2009 through December 2009, February 2010 through December 2010, and May through
June 2011.51 As a result of its failures to pay, Kajeet maintained outstanding USF balances every month
between May 2009 and June 2011.52 Kajeet’s failure to comply fully and timely with the USF
requirements for 23 of the last 30 months also afforded it a financial benefit and an economic advantage
over its competitors who complied with their USF obligations. Based on the record developed in our
investigation, we find that Kajeet has apparently violated section 254(d) of the Act and section 54.706(a)
of the Commission’s rules by apparently willfully and repeatedly failing to contribute fully and timely to
the USF.


47 47 U.S.C. § 254(d); 47 C.F.R. § 54.706(a).
48 47 C.F.R. § 54.706(a).
49 See id.
50 See LOI Response at response to Question 18.
51 See id.; see also First Watterson Email, Second Watterson Email, Berkland Email. As of October 2011, Kajeet’s
USAC invoices reflected a credit balance.
52 The apparent violations continued with each subsequent day on which Kajeet failed to make full payment. See
Globcom, Inc. d/b/a Globcom Global Communications
, Order of Forfeiture, 21 FCC Rcd 4710, 4723, ¶ 35 n.105
(2006) (“Globcom Forfeiture Order”) (“Each failure to pay the amount due each month constituted a violation that
continued for more than 10 days.”). USAC’s practice is to apply partial payments to the oldest debt carried on
USAC’s books first, and not the current billed amount. See Intellicall Operator Services, Forfeiture Order, 15 FCC
Rcd 21771, 21772, ¶ 6 n.8 (2000). This practice was codified by the Commission in 2007. See Comprehensive
Review of the Universal Service Fund Management, Administration, and Oversight; Federal-State Joint Board on
Universal Service; Schools and Libraries Universal Service Support Mechanism; Rural Health Care Support
Mechanism; Lifeline and Link Up; Changes to the Board of Directors for the National Exchange Carrier
Association, Inc.
, Report and Order, 22 FCC Rcd 16372, 16381, ¶ 16 (2007); 47 C.F.R. § 54.713(e). Each violation
is considered continuing until cured by full payment of each monthly obligation, as provided on the corresponding
invoices. See Telrite Corp., Notice of Apparent Liability for Forfeiture and Order, 23 FCC Rcd 7231, 7238-39, ¶ 15
(2008) (“Telrite NAL”); Compass Global, Inc., Notice of Apparent Liability for Forfeiture, 23 FCC Rcd 6125, 6139-
40, ¶¶ 31-33 (2008) (“Compass Global NAL”); Global Crossing North America, Inc., Notice of Apparent Liability
for Forfeiture, 23 FCC Rcd 6110, 6120-22, ¶¶ 21-25 (2008) (“Global Crossing NAL”); VCI Company, Notice of
Apparent Liability for Forfeiture and Order, 22 FCC Rcd 15933, 15941, ¶ 24 & n.69 (2007); Matrix Telecom, Inc.,
Notice of Apparent Liability for Forfeiture, 15 FCC Rcd 13544, 13546, ¶ 7 (2000); Conquest Operator Services
Corp.
, Order of Forfeiture, 14 FCC Rcd 12518, 12524-25, ¶ 16 (1999).
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14.
Kajeet/Airlink began operating in April 2009, but did not make any USF contributions
until December 2010.53 The Companies indicate in the LOI Response that Kajeet/Airlink “has not yet
contributed to the USF, nor has it filed any Form 499-Qs.”54 The Companies claim that “[d]ue to the
severe economic turbulence of 2009, we focused on making sure this entity was able to operate and
survive during the short time we’ve had to stabilize the customer base supported by the assets acquired by
Kajeet/Airlink.”55 The Companies further assert that they were in the process of preparing a 2010 Form
499-A for Kajeet/Airlink so that “we can fulfill the appropriate USAC obligations for this entity.”56
According to USAC records, Kajeet/Airlink failed to file any quarterly Worksheets until May 2010, and
did not file its 2010 annual Worksheet until September 21, 2010, more than five months after it was due.
Based on the record before us, including the revenues reported in Kajeet/Airlink’s 2010 annual
Worksheet,57 Kajeet/Airlink would not have qualified for the de minimis exemption from contributing to
the USF during 2009 and therefore should have filed quarterly Worksheets beginning in May 2009.58
Because Kajeet/Airlink failed to file any required Worksheets until May 2010, USAC did not begin
sending it invoices until July 2010.59 Kajeet/Airlink failed to make any payments on its USF invoices for
the monthly payments due in August 2010 through November 2010, and made only a partial payment in
December 2010.60 Kajeet/Airlink also failed to make any payments on its USF invoices for the monthly
payments due in January, March, April, and May 2011, and made only a partial payment in February
2011.61 Based on the record developed in our investigation, we find that Kajeet/Airlink has apparently
violated section 254(d) of the Act and section 54.706(a) of the Commission’s rules by apparently
willfully and repeatedly failing to contribute fully and timely to the USF.


53 See First Watterson Email, Second Watterson Email.
54 LOI Response at response to Question 18.
55 Id.
56 Id.
57 See Kajeet/Airlink, LLC, 2010 FCC Form 499-A.
58 As set forth in detail in the attached confidential Appendix, Kajeet/Airlink acquired the assets of a
telecommunications provider in April 2009. The instructions for the quarterly Worksheets explicitly provide that
“[w]here an entity obtains, through purchase, merger or transfer, the telecommunications operations or customer
base of a telecommunications provider during a quarter, the acquiring company must report all telecommunications
revenues associated with such operations or customer base including revenues billed in the quarter prior to the date
of acquisition.” See FCC Form 499-Q Telecommunications Reporting Worksheet − Quarterly Filing for Universal
Service Contributors
, http://www.fcc.gov/Forms/Form499-Q/499q.pdf (April 2010). Therefore, Kajeet/Airlink
should have filed a quarterly Worksheet on May 1, 2009 which included revenues billed during the prior quarter
(January 1 - March 31, 2009) and projected revenues for the upcoming quarter (July 1 – September 30, 2009).
59 See supra note 22. A carrier that does not file the required Worksheets may not receive an invoice from USAC,
but is nonetheless required to contribute to the USF, unless its revenues are considered de minimis. See Globcom
NAL
, 18 FCC Rcd at 19896, ¶ 5 n.22. USAC included a true-up adjustment for 2009 based on Kajeet/Airlink’s late-
filed 2010 Form 499-A (reporting revenues for 2009) in three equal installments in Kajeet/Airlink’s October,
November and December 2010 invoices. See Second Watterson Email.
60 See First Watterson Email, Second Watterson Email. As noted above, the violations continued with each
subsequent day on which Kajeet/Airlink failed to make full payment. See supra note 52.
61 See Berkland Email. As of October 2011, Kajeet/Airlink’s USAC invoices reflected a credit balance of
approximately $12,000 but it had a past due balance to USAC (in the form of delinquent debt transferred to the
Commission pursuant to the DCIA transfer process) of approximately $39,000. See id.
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B.

Kajeet and Kajeet/Airlink Apparently Failed To Make Full and Timely TRS
Fund Contributions

15.
We also find that Kajeet and Kajeet/Airlink apparently violated section 225(b)(1) of the
Act and section 64.604(c)(5)(iii)(A) of the Commission’s rules by apparently willfully and repeatedly
failing to contribute fully and timely to the TRS Fund.62 As interstate telecommunications carriers, Kajeet
and Kajeet/Airlink were obligated to contribute to the TRS Fund on the basis of the interstate end-user
telecommunications revenues reported on their annual Worksheets.63 A carrier’s contribution to the TRS
Fund is based on its subject revenues for the prior calendar year and a contribution factor determined
annually by the Commission.64 Subject carriers must make TRS contributions on an annual basis, with
certain exceptions that are not applicable to Kajeet and Kajeet/Airlink.65
16.
The record demonstrates that Kajeet and Kajeet/Airlink failed to make full and timely
contributions to the TRS Fund in 2010.66 The TRS Fund administrator invoiced Kajeet for an adjustment
to its 2009 TRS Fund contribution on May 4, 2010, with a due date of May 26, 2010, and invoiced Kajeet
for its 2010 TRS Fund contribution on July 4, 2010, with a due date of July 26, 2010.67 The TRS Fund
administrator invoiced Kajeet/Airlink for its 2010 TRS Fund contribution on November 4, 2010, with a
due date of November 26, 2010.68 As of January 10, 2011, however, neither Kajeet nor Kajeet/Airlink
had made any payments toward their TRS obligations for 2010.69 Based on the record developed in our
investigation, we find that Kajeet and Kajeet/Airlink have apparently violated section 225(b)(1) of the Act
and section 64.604(c)(5)(iii)(A) of the Commission’s rules by apparently willfully and repeatedly failing
to make required TRS Fund contributions in 2010.

C.

Kajeet and Kajeet/Airlink Apparently Failed To Make Full and Timely
Contributions to the LNP Cost Recovery Mechanism

17.
We find that Kajeet and Kajeet/Airlink apparently violated section 251(e)(2) of the Act
and section 52.32(a) of the Commission’s rules by apparently willfully and repeatedly failing to
contribute fully and timely to the LNP cost recovery mechanism.70 As telecommunications carriers,
Kajeet and Kajeet/Airlink were obligated to contribute to the LNP cost recovery mechanism on the basis
of the end-user telecommunications revenues reported on their annual Worksheets.71


62 47 U.S.C. § 225; 47 C.F.R. § 64.604(c)(5)(iii)(A).
63 Id. See also 47 C.F.R. § 64.604(c)(5)(iii)(B) (setting forth methods of computation and payment of contributions
to TRS Fund).
64 47 C.F.R. § 64.604(c)(5)(iii)(B).
65 Id. Under the Commission’s rules, each subject carrier must contribute at least $25 per year, and providers whose
annual contributions are less than $1,200 must pay the entire amount at the beginning of the contribution period.
Otherwise, providers may divide their contributions into equal monthly payments. Id.
66 See Aparicio Email.
67 See id. The TRS Fund administrator also issued a credit adjustment invoice to Kajeet on October 4, 2010. See id.
68 See id. The TRS Fund administrator did not invoice Kajeet/Airlink until November 2010 because it filed its 2010
annual Worksheet late. See id.
69 See id.
70 47 U.S.C. § 251(e)(2); 47 C.F.R. § 52.32(a).
71 47 C.F.R. § 52.32(a).
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18.
The record demonstrates that Kajeet and Kajeet/Airlink failed to contribute fully and
timely to the LNP cost recovery mechanism in 2010 and 2011.72 The LNP administrator invoiced Kajeet
monthly throughout 2010 and 2011 and began sending Kajeet/Airlink monthly invoices in October
2010.73 As of October 26, 2011, however, Kajeet had not made any payments towards its LNP
administration obligations for 2010 or 2011.74 Kajeet/Airlink did not make any payments towards its
LNP administration obligations for 2010 until July 2011 and, as of October 26, 2011, had not made any
payments towards its LNP administration obligations for 2011.75 Based on the record developed in our
investigation, we find that Kajeet and Kajeet/Airlink have apparently violated section 251(e)(2) of the Act
and section 52.32(a) of the Commission’s rules by apparently willfully and repeatedly failing to
contribute to the LNP cost recovery mechanism in 2010 and 2011.

D.

Kajeet/Airlink Apparently Failed to Obtain Commission Approval Prior to
Consummating the Assignment of an International Section 214
Authorization

19.
We find that Kajeet/Airlink apparently violated section 214 of the Act and section 63.24
of the Commission’s rules by apparently willfully consummating the assignment of an international
section 214 authorization without prior Commission approval.76 Under section 63.24 of the Commission’s
rules,77 an assignment of an international section 214 authorization requires application to, and approval
from, the Commission. The proposed assignee must apply to the Commission for approval prior to the
consummation of the proposed assignment.78 Based on the record developed in our investigation, as set
forth in detail in the attached confidential Appendix, we find that Kajeet/Airlink has apparently violated
section 214 of the Act and section 63.24 of the Commission’s rules by apparently willfully failing to obtain
Commission approval prior to consummating the assignment of an international section 214 authorization.

E.

Proposed Forfeitures

20.
Section 503(b)(1) of the Act provides that any person who willfully or repeatedly fails to
comply with any provision of the Act or any rule, regulation, or order issued by the Commission shall be
liable to the United States for a forfeiture penalty.79 Section 503(b)(2)(B) of the Act authorizes the
Commission to assess a forfeiture of up to $150,000 for each violation or each day of a continuing
violation, up to a statutory maximum of $1,500,000 for a single act or failure to act.80 In determining the
appropriate forfeiture amount, we consider the factors enumerated in section 503(b)(2)(E) of the Act,
including “the nature, circumstances, extent, and gravity of the violation and, with respect to the violator,


72 See First Laffey Email, Second Laffey Email.
73 See First Laffey Email, Second Laffey Email. The LNP administrator did not begin invoicing Kajeet/Airlink until
October 2010 because it filed its 2010 annual Worksheet late. See First Laffey Email.
74 See First Laffey Email, Second Laffey Email.
75 See First Laffey Email, Second Laffey Email.
76 47 U.S.C. § 214; 47 C.F.R. § 63.24.
77 47 C.F.R. § 63.24.
78 47 C.F.R. § 63.24(e).
79 47 U.S.C. § 503(b)(1)(B); 47 C.F.R. § 1.80(a)(2).
80 47 U.S.C. § 503(b)(2)(B); see also 47 C.F.R. § 1.80(b)(2); Amendment of Section 1.80(b) of the Commission’s
Rules, Adjustment of Forfeiture Maxima to Reflect Inflation,
Order, 23 FCC Rcd 9845 (2008).
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the degree of culpability, any history of prior offenses, ability to pay, and such other matters as justice
may require,”81 as well as our forfeiture guidelines.82
1. Kajeet
21.
We find that Kajeet made only partial payments to the USF in May 2009, January 2010,
and January 2011, and failed to make any required monthly payments in June 2009 through December
2009, February 2010 through December 2010, and May 2011 through June 2011.83 Nonpayment of
universal service contributions is an egregious offense. It not only deprives the USF of resources
necessary to preserve and advance universal service, but it also bestows on delinquent entities an unfair
competitive advantage by shifting to compliant contributors the economic costs and burdens associated
with universal service. An entity’s failure to make required universal service contributions frustrates
Congress’s policy objective in section 254(d) of the Act to ensure the equitable and non-discriminatory
distribution of universal service costs among all telecommunications providers.84 The Commission has
established a base forfeiture amount of $10,000 for each month in which a contributor has failed to fully
pay required universal service contributions and $20,000 for each month in which a contributor has failed
to make any required universal service contribution,85 plus an upward adjustment based on one-half of the
company’s approximate unpaid contributions.86 In addition, the Commission has treated failures to pay
universal service and other obligations as continuing violations.87 Our forfeiture calculation therefore
reflects not only violations that began within the last twelve months, but also violations that began prior
to the last twelve months and continued during the twelve-month period preceding this NAL.
22.
As a result, we find that Kajeet is apparently liable for a forfeiture for apparently willfully
and repeatedly failing to contribute fully and timely to the USF on a total of nineteen occasions between
September 2009 and June 2011.88 Accordingly, we assess a $20,000 forfeiture for each of the seventeen
months in which Kajeet failed to remit any contribution toward its outstanding USF obligation.89 We also
assess a $10,000 forfeiture for two months in which Kajeet failed to fully pay its required universal
service contribution, as provided on the corresponding invoices.90 Thus, we find Kajeet apparently liable
for a base forfeiture of $360,000 for its apparent willful and repeated failures to contribute fully and
timely to the USF on nineteen occasions between September 2009 and June 2011. Moreover, consistent


81 47 U.S.C. § 503(b)(2)(E).
82 47 C.F.R. § 1.80(b)(4), Note to Paragraph (b)(4): Guidelines for Assessing Forfeitures.
83 See supra para. 13.
84 See 47 U.S.C. § 254(d).
85 See OCMC, Inc., Order of Forfeiture, 21 FCC Rcd 10479, 10482 ¶ 10 (2006) (“OCMC Forfeiture Order”);
Globcom Forfeiture Order, 21 FCC Rcd at 4722 ¶ 33.
86 See OCMC Forfeiture Order, 21 FCC Rcd at 10482 ¶ 10; Globcom Forfeiture Order, 21 FCC Rcd at 4722 ¶ 33.
87 See Telrite NAL, 23 FCC Rcd at 7245-46 ¶ 36 (proposing $924,212 forfeiture for, inter alia, the apparent failure
to make required universal service contributions); Compass Global NAL, 23 FCC Rcd at 6140-42 ¶¶ 34-38
(proposing $828,613.44 forfeiture for, inter alia, the apparent failure to make required universal service
contributions); Global Crossing NAL, 23 FCC Rcd at 6120-23 ¶¶ 21-27 (proposing $10,518,013 forfeiture for, inter
alia
, the apparent failure to make required universal service contributions).
88 We note that Kajeet’s violations for the months of May through August 2009 were cured more than one year ago.
89 These months consist of September 2009 through December 2009, February 2010 through December 2010, and
May and June 2011. See supra para. 13.
90 These months are January 2010 and January 2011. See supra para. 13.
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with our approach for assessing liability for apparent USF violations, and taking into account all the
factors enumerated in section 503(b)(2)(E) of the Act, we also add an upward adjustment of $66,966 to
the base forfeiture—approximately one-half of the largest amount of Kajeet’s unpaid USF contributions
during the period at issue.91 We therefore find Kajeet apparently liable for a forfeiture of four hundred
twenty-six thousand, nine hundred sixty-six dollars ($426,966) for its apparent willful and repeated
failures to contribute fully and timely to the USF.
23.
We also find that Kajeet is apparently liable for a forfeiture for apparently willfully and
repeatedly failing to make required TRS contributions in 2010. Where a provider fails to satisfy its TRS
obligations, it thwarts the purpose for which Congress established section 225(b)(1) of the Act and its
implementing regulations – to ensure that telecommunications relay services “are available to the extent
possible and in the most efficient manner, to hearing-impaired and speech-impaired individuals in the
United States.”92 The Commission has generally established a base forfeiture amount of $10,000 for each
instance in which a contributor fails to make required TRS contributions and an upward adjustment based
on one-half of the company’s approximate unpaid contributions.93 We assess a $10,000 forfeiture for
Kajeet’s failure to pay its TRS Fund contributions in 2010 and an upward adjustment of $3,220,
approximately one-half of Kajeet’s unpaid TRS Fund contributions. We therefore find Kajeet apparently
liable for a forfeiture of thirteen thousand, two hundred twenty dollars ($13,220) for its apparent willful
and repeated failure to contribute fully and timely to the TRS Fund.
24.
Additionally, we conclude that Kajeet is apparently liable for a forfeiture for apparently
willfully and repeatedly failing to make full and timely contributions toward LNP cost recovery
mechanisms in 2010 and 2011. The failure of carriers to make required LNP contributions severely
hampers the Commission’s ability to ensure that the cost of establishing number portability arrangements
are “borne by all telecommunications carriers on a competitively neutral basis” as Congress envisioned.94
The Commission has prescribed a $10,000 base forfeiture amount for failure to pay LNP contributions.95
We find Kajeet apparently liable for a forfeiture of twenty thousand dollars ($20,000) for its apparent
willful and repeated failures to make full LNP payments in 2010 and 2011.
2. Kajeet/Airlink
25.
Initially, we note that although Kajeet/Airlink has been providing telecommunications
service since April 2009, it failed to file any quarterly Worksheets until May 2010 and filed its 2010
annual Worksheet, which was due April 1, 2010, more than five months late on September 21, 2010. A
carrier’s failure to file these Worksheets is directly linked to, and thus has serious implications for,
administration of the USF, TRS, NANP, LNP, and regulatory fee programs. By failing to report its
revenue, Kajeet/Airlink avoided making full and timely payment into these programs and unilaterally
shifted to compliant carriers and their customers the economic costs associated with the programs.96


91 See supra para. 13. This amount includes Kajeet’s largest unpaid balance to USAC plus delinquent debt
transferred to the Commission pursuant to the DCIA transfer process.
92 47 U.S.C. § 225(b)(1).
93 See Globcom NAL, 18 FCC Rcd at 19904 ¶ 29.
94 47 U.S.C. § 251(e)(2).
95 See Telrite NAL, 23 FCC Rcd at 7245 ¶ 34.
96 Kajeet/Airlink should have filed Worksheets beginning in May 2009. See supra note 58 and accompanying text.
Although the Worksheets were due on specific dates, Kajeet/Airlink’s failure to report revenue had a continuing
harmful impact on various programs because the relevant fund administrators could not properly assess
(continued …)
12

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26.
We find that Kajeet/Airlink failed to make any required monthly payments to the USF in
August 2009 through November 2010, and in January, March, April and May 2011, and made only partial
payments in December 2010 and February 2011.97 We accordingly find that Kajeet/Airlink is apparently
liable for a forfeiture for apparently willfully and repeatedly failing to contribute fully and timely to the
USF on a total of twenty-two occasions between August 2009 and May 2011. We accordingly assess a
$20,000 forfeiture for each of the twenty months in which Kajeet/Airlink failed to remit any contribution
toward its outstanding USF obligation.98 We also assess a $10,000 forfeiture for the two months in which
Kajeet/Airlink failed to fully pay its required universal service contribution.99 Thus, we find
Kajeet/Airlink apparently liable for a base forfeiture of $420,000 for its willful and repeated failures to
contribute fully and timely to the USF on twenty-two occasions between August 2009 and May 2011.
We also conclude that an upward adjustment to the base forfeiture associated with Kajeet/Airlink’s failure
to contribute to the USF is appropriate. Accordingly, taking into account all of the factors enumerated in
section 503(b)(2)(E) of the Act, we propose an upward adjustment of $35,185, approximately one-half of
the largest amount of Kajeet/Airlink’s unpaid USF contributions during the period at issue. We therefore
find Kajeet/Airlink apparently liable for a forfeiture of four hundred fifty-five thousand, one hundred
eighty-five dollars ($455,185) for its apparent willful and repeated failures to contribute fully and timely
to the USF.
27.
We also find that Kajeet/Airlink is apparently liable for a forfeiture for apparently
willfully and repeatedly failing to make required TRS contributions in 2010. We assess a $10,000
forfeiture for Kajeet/Airlink’s failure to pay its TRS Fund contributions in 2010 and an upward
adjustment of $1,457, approximately one-half of Kajeet/Airlink’s unpaid TRS Fund contributions. We
thus find Kajeet/Airlink apparently liable for a forfeiture of eleven thousand, four hundred fifty-seven
dollars ($11,457) for its apparent willful and repeated failure to contribute fully and timely to the TRS
Fund.
28.
Furthermore, we conclude that Kajeet/Airlink is apparently liable for a forfeiture for
apparently willfully and repeatedly failing to make full and timely contributions toward LNP cost
recovery mechanisms in 2010 and 2011. As noted above, the Commission has prescribed a $10,000 base
forfeiture amount for failure to pay LNP contributions.100 We find Kajeet/Airlink apparently liable for a
forfeiture of twenty thousand dollars ($20,000) for its apparent willful and repeated failures to make full
LNP payments in 2010 and 2011.
(Continued from previous page)


Kajeet/Airlink’s payment obligations. Kajeet/Airlink’s failures to file worksheets constitute continuing violations
for which the one-year statute of limitations for forfeitures under section 503(b)(2)(B) of the Act is tolled until the
violation is cured. See Telrite NAL, 23 FCC Rcd at 7244 ¶ 30. Consistent with precedent, however, we exercise our
prosecutorial discretion here and decline to propose forfeitures for Kajeet/Airlink’s failures to file Worksheets, all of
which occurred more than one year prior to the date of this NAL. See, e.g., Omniat International Telecom, LLC
d/b/a Omniat Telecom
, Notice of Apparent Liability for Forfeiture, 24 FCC Rcd 4254, 4265 ¶ 26 (2009); Compass
Global NAL
, 23 FCC Rcd at 6138 ¶ 29. We caution Kajeet/Airlink and other carriers that future enforcement
actions may consider all failures to file Worksheets as continuing violations subject to forfeiture action.
97 See supra para. 14. If Kajeet/Airlink had begun filing quarterly Worksheets in May 2009, it would have received
its first invoice from USAC no later than July 2009 with its first payment due in August 2009.
98 These months consist of August 2009 through November 2010, and January, March, April and May 2011. See
supra
para. 14.
99 These months are December 2010 and February 2011. See supra para. 13.
100 See Telrite NAL, 23 FCC Rcd at 7245 ¶ 34.
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29.
Finally, we find that Kajeet/Airlink is apparently liable for a forfeiture for apparently
willfully failing to obtain Commission approval prior to consummating the assignment of an international
section 214 authorization. The Commission’s Forfeiture Policy Statement and implementing rules
prescribe a base forfeiture of $8,000 for an unauthorized substantial assignment.101 Such forfeiture
amount may be adjusted upward or downward depending on the existence of aggravating or mitigating
factors. In the instant case, we have taken into consideration Kajeet/Airlink’s failure over a period of
approximately two years to file a corrective application. On balance and after applying the factors set
forth in section 503(b)(2)(E) of the Act, we find that a forfeiture in the amount of $16,000 is
appropriate.102 Accordingly, we find Kajeet/Airlink apparently liable for a forfeiture of sixteen thousand
dollars ($16,000) for its apparent willful failure to obtain Commission approval prior to consummating
the assignment of an international section 214 authorization.

IV.

CONCLUSION

30.
In light of the seriousness, duration, and scope of the apparent violations, we propose a
total forfeiture of four hundred sixty thousand, one hundred eighty-six dollars ($460,186) against
Kajeet,103 consisting of four hundred twenty-six thousand, nine hundred sixty-six dollars ($426,966) for
failure to make full and timely USF contributions; thirteen thousand, two hundred twenty dollars
($13,220) for failure to make full and timely TRS contributions; and twenty thousand dollars ($20,000)
for failure to make LNP contributions.
31.
We also propose a total forfeiture of five hundred two thousand, six hundred forty-two
dollars ($502,642) against Kajeet/Airlink, consisting of four hundred fifty-five thousand, one hundred
eighty-five dollars ($455,185) for failure to make full and timely USF contributions; eleven thousand,
four hundred fifty-seven dollars ($11,457) for failure to make full and timely TRS contributions; twenty
thousand dollars ($20,000) for failure to make LNP contributions; and sixteen thousand dollars ($16,000)
for failure to obtain Commission approval prior to consummating the assignment of an international
section 214 authorization.
32.
In addition, we order the Companies to submit within thirty (30) calendar days a
report―supported by a declaration under penalty of perjury from a corporate officer―setting forth in
detail their plans to come into compliance with the payment obligations discussed herein and describing
the steps Kajeet/Airlink has taken to come into compliance with the requirements of section 214 of the
Act and section 63.24 of the Commission’s rules.
33.
We caution that additional violations of the Act or the Commission’s rules could subject
the Companies to further enforcement action. Such action could take the form of higher monetary


101 See 47 C.F.R. § 1.80; Forfeiture Policy Statement, 12 FCC Rcd 17087, 17113 (1997).
102 See e.g., Shop at Home Holdings, Inc., Notice of Apparent Liability for Forfeiture, 25 FCC Rcd 23, 25 ¶ 8 (Enf.
Bur., Investigations and Hearings Div., 2010) (proposing a $16,000 forfeiture against an entity which acquired and
operated two satellite earth stations without prior Commission approval and failed to file a corrective application for
more than two years).
103 Kajeet and Kajeet/Airlink continue to have unpaid outstanding balances due to the TRS and LNP Administrators
and Kajeet/Airlink continues to have an unpaid outstanding balance due to USAC. We note that payment of the
forfeitures proposed in this NAL does not absolve Kajeet and Kajeet/Airlink of their obligations to pay their
delinquent balances. As discussed supra at note 9, debt collection procedures may include further administrative
efforts both by the Commission and by the United States Treasury or, as appropriate, the Commission may refer the
delinquent debt to the Department of Justice for enforced collection action. 47 C.F.R. § 1.1917.
14

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forfeitures, possible disqualification of the Companies’ principals from the provision of any interstate
common carrier services without the prior consent of the Commission, and/or possible revocation of the
Companies’ authority to operate.

V.

ORDERING CLAUSES

34.

ACCORDINGLY, IT IS ORDERED

that, pursuant to section 503(b) of the Act,104 and
section 1.80 of the Commission’s rules,105 that Kajeet, Inc. is hereby

NOTIFIED of its APPARENT
LIABILITY FOR A FORFEITURE

in the amount of four hundred sixty thousand, one hundred eighty-
six dollars ($460,186) for willfully and repeatedly violating the Act and the Commission’s rules.
35.

IT IS FURTHER ORDERED

that, pursuant to section 503(b) of the Act and section
1.80 of the Commission’s rules that Kajeet/Airlink, LLC is hereby

NOTIFIED

of its

APPARENT
LIABILITY FOR A FORFEITURE

in the amount of five hundred two thousand, six hundred forty-two
dollars ($502,642) for willfully and repeatedly violating the Act and the Commission’s rules.
36.

IT IS FURTHER ORDERED

that, pursuant to section 1.80 of the Commission’s rules,
within thirty (30) calendar days of the release date of this Notice of Apparent Liability for Forfeiture and
Order, the Companies

SHALL PAY

the full amount of the proposed forfeitures or

SHALL FILE

a
written statement seeking reduction or cancellation of the proposed forfeitures.
37.

IT IS FURTHER ORDERED

that the Companies shall submit within thirty days of the
release date of this Notice of Apparent Liability for Forfeiture and Order, a report supported by a
declaration under penalty of perjury from a corporate officer setting forth in detail the Companies’ plans
to come into compliance with the payment obligations discussed herein and describing the steps
Kajeet/Airlink has taken to come into compliance with the requirements of section 214 of the Act and
section 63.24 of the Commission’s rules. The report must be mailed to Theresa Z. Cavanaugh, Acting
Chief, Investigations and Hearings Division, Enforcement Bureau, Federal Communications Commission,
445 12th Street, S.W., Suite 4-C330, Washington, D.C. 20554. The Companies shall also transmit a copy
of the report via email to Theresa Z. Cavanaugh at Terry.Cavanaugh@fcc.gov and Kathy Berthot at
Kathy.Berthot@fcc.gov.
38.
Payment of the forfeiture must be made by check or similar instrument, payable to the
order of the Federal Communications Commission. The payment must include the NAL/Acct. No. and
FRN referenced above. 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. For payment by credit card, an FCC Form
159 (Remittance Advice) must be submitted. When completing the FCC Form 159, enter the
NAL/Account number in block number 23A (call sign/other ID), and enter the letters “FORF” in block
number 24A (payment type code). The Companies will also send electronic notification within forty-
eight (48) hours of the date said payment is made to Terry.Cavanaugh@fcc.gov and
Kathy.Berthot@fcc.gov.


104 47 U.S.C. § 503(b).
105 47 C.F.R. § 1.80.
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39.
The written statement seeking reduction or cancellation of the proposed forfeitures, if
any, must include a detailed factual statement supported by appropriate documentation and affidavits
pursuant to sections 1.80(f)(3) and 1.16 of the Commission’s rules.106 The written statement must be
mailed to Theresa Z. Cavanaugh, Acting Chief, Investigations and Hearings Division, Enforcement
Bureau, Federal Communications Commission, 445 12th Street, S.W., Room 4-C330, Washington, D.C.
20554 and must include the NAL/Acct. No. referenced above. The written statement should also be
emailed to Theresa Z. Cavanaugh at Terry.Cavanaugh@fcc.gov and Kathy Berthot at
Kathy.Berthot@fcc.gov.
40.
The Commission will not consider reducing or canceling a forfeiture in response to a
claim of inability to pay unless the petitioner submits: (1) federal tax returns for the most recent three-
year period; (2) financial statements prepared according to generally accepted accounting practices
(GAAP); or (3) some other reliable and objective documentation that accurately reflects the petitioner’s
current financial status. Any claim of inability to pay must specifically identify the basis for the claim by
reference to the financial documentation submitted.
41.
Requests for payment of the full amount of this Notice of Apparent Liability for
Forfeiture and Order under an installment plan should be sent to: Chief Financial Officer―Financial
Operations, Federal Communications Commission, 445 12th Street, S.W., Room 1-A625, Washington,
D.C. 20554.107 For answers to questions regarding payment procedures, please contact the Financial
Operations Group Help Desk at 1-877-480-3201 or Email: ARINQUIRIES@fcc.gov.
42.

IT IS FURTHER ORDERED

that a copy of this Notice of Apparent Liability for
Forfeiture and Order shall be sent by certified mail, return receipt requested, to Daniel Neal, CEO, Kajeet,
Inc. and Kajeet/Airlink, LLC, 7101 Wisconsin Ave., Suite 1111, Bethesda, MD 20814.
FEDERAL COMMUNICATIONS COMMISSION
Marlene H. Dortch
Secretary


106 See 47 C.F.R. §§ 1.80(f)(3), 1.16.
107 See 47 C.F.R. § 1.1914.
16

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