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Before the
Federal Communications Commission
Washington, D.C. 20554
In the Matter of )
) File No. EB-01-DL-703
Friendship Cable of Texas, Inc. )
Physical System ID 005073 ) NAL/Acct. No.
200232500002
Vernon, Texas 75111 )
) FRN 0004-9995-61
)
FORFEITURE ORDER
Adopted: May 8, 2002 Released: May 13, 2002
By the Chief, Enforcement Bureau:
I. INTRODUCTION
1. In this Forfeiture Order (``Order''), we issue a
monetary forfeiture in the amount of eight thousand dollars
($8,000), to Friendship Cable of Texas, Inc. ("Friendship"),
Physical System ID 005073, for its willful and repeated
violation of Sections 76.605(a)(12) and 76.611(a) of the
Commission's Rules ("Rules").1 The noted violations involve
Friendship's failure to comply with the Commission's cable
signal leakage standards.
2. On February 4, 2002, the District Director of the
Commission's Dallas, Texas Field Office ("Dallas Office")
issued a Notice of Apparent Liability for Forfeiture ("NAL")2
in the amount of eight thousand dollars ($8,000). Friendship
filed a response on February 27, 2002.
II. BACKGROUND
3. On September 24 and 25, 2001, a Commission agent from
the Dallas Office conducted an inspection of the portion of
Friendship's cable system serving Vernon, Texas, to identify
leaks and determine compliance with the basic signal leakage
criteria. The agent identified and measured six leaks, which
ranged from 177 mV/m to 2,415 mV/m. The system was found to
have a Cumulative Leakage Index (``CLI'') (10 log IĄ) value of
72.7, which is significantly in excess of the maximum allowable
level of 64.3
4. On September 25, 2001, the Commission's Dallas
Office contacted Friendship at their headquarters in Tyler,
Texas and verbally ordered Friendship to cease operation on
aeronautical band frequencies until the leaks were repaired and
the system complied with the basic signal leakage criteria.
The Dallas Office followed the oral order with a written Order
to Cease Operations, delivered by facsimile and by regular mail
on September 25, 2001.4
5. On September 26, 2001, Friendship informed the
Commission's Dallas Office that the system was in compliance
with the leakage restrictions and requested permission to
resume normal operations. The Dallas Office granted
Friendship's request to resume normal operations. On September
27, 2001 an agent from the Commission's Dallas Office conducted
a follow-up inspection and found the system to be in compliance
with the basic signal leakage criteria.
6. On February 4, 2002, the District Director of the
Dallas Office issued a NAL to Friendship for its failure to
comply with the signal leakage standards. On February 27,
2002, the Bureau received a response to the NAL. In its
response, Friendship does not dispute the violations. Rather,
Friendship states that it has filed for bankruptcy under
Chapter 11 of the U.S. Bankruptcy Code and, consequently,
requests a waiver of the proposed forfeiture.
III. DISCUSSION
·
7. The forfeiture amount in this case was assessed
in accordance with Section 503(b) of the Communications Act of
1934, as amended (``Act''),5 Section 1.80 of the Rules,6 and
The Commission's Forfeiture Policy Statement and Amendment of
Section 1.80 of the Rules to Incorporate the Forfeiture
Guidelines, 12 FCC Rcd 17087 (1997), recon. denied, 15 FCC Rcd
303 (1999). In examining Friendship's response, Section 503(b)
of the Act requires that the Commission take into account the
nature, circumstances, extent and gravity of the violation and,
with respect to the violator, the degree of culpability, any
history of prior offenses, ability to pay, and other such
matters as justice may require.7
8. Friendship has acknowledged that the violations for
which it was cited did, in fact, occur. Because there is no
dispute as to whether the violations occurred, we affirm
issuance of the forfeiture for violation of Sections
76.605(a)(12) and 76.611(a) of the Rules.
9. Friendship seeks waiver of the forfeiture because it
has filed bankruptcy. However, as explicitly stated in the
NAL, 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.
Friendship did not provide any financial documentation in
support of its request for waiver of the forfeiture and,
therefore, we have no basis upon which to analyze its inability
to pay claim. Further, although there is precedent for
reducing or rescinding a forfeiture based on bankruptcy in
certain circumstances,8 we do not believe that Friendship has
justified a reduction or rescission in this case because it has
not provided financial documentation for the Bureau's analysis,
and because, even though it has filed bankruptcy, it retains
control over its assets. Moreover, filing for bankruptcy does
not preclude the Commission from issuing an order imposing a
forfeiture upon Friendship for violating its rules.9
IV. ORDERING CLAUSES
10. Accordingly, IT IS ORDERED THAT, pursuant to Section
503(b) of the Act and Sections 0.111, 0.311 and 1.80(f)(4) of
the Rules,10 Friendship Cable of Texas, Inc. IS LIABLE FOR A
MONETARY FORFEITURE in the amount of eight thousand dollars
($8,000) for violating Sections 76.605(a)(12) and 76.611(a) of
the Rules.
11. Payment of the forfeiture shall be made in the manner
provided for in Section 1.80 of the Rules within 30 days of the
release of this Order. If the forfeiture is not paid within
the period specified, the case may be referred to the
Department of Justice for collection pursuant to Section 504(a)
of the Act.11 Payment shall be made by mailing a check or
similar instrument, payable to the order of the "Federal
Communications Commission," to the Federal Communications
Commission, P.O. Box 73482, Chicago, Illinois 60673-7482. The
payment should note NAL/Acct. No. 200232500002, and FRN 0004-
9995-61. Requests for full payment under an installment plan
should be sent to: Chief, Revenue and Receivables Group, 445
12th Street, S.W., Washington, D.C. 20554.12
12. IT IS FURTHER ORDERED that, a copy of this Order
shall be sent by Certified Mail Return Receipt Requested to
Friendship Cable of Texas, Inc. at P.O. Box 9200, Tyler, Texas
75111.
FEDERAL COMMUNICATIONS COMMISSION
David H. Solomon
Chief, Enforcement Bureau
_________________________
1 47 C.F.R. §' 76.605(a)(12) and 76.611(a).
2 Notice of Apparent Liability for Forfeiture, NAL/Acct.
No. 200232500002 (Enf. Bur., Dallas Office, released February
4, 2002).
3 A maximum CLI of 64 is the basic signal leakage
performance criteria of Section 76.611(a)(1) of the Rules.
Leakage that exceeds this level is deemed to pose a serious
threat to air traffic safety communications.
4 See 47 C.F.R. 76.613(c).
5 47 U.S.C. § 503(b).
6 47 C.F.R. § 1.80.
7 47 U.S.C. § 503(b)(2)(D).
8 See, e.g., Dennis Elam, Trustee for Bakcor Broadcasting,
Inc., Debtor, 11 FCC Rcd 1137 (1996) (forfeiture rescinded
after bankruptcy trustee was appointed and the violator was no
longer associated with the subject radio stations); Interstate
Savings, Inc. d/b/a ISI Communications, 12 FCC Rcd 2934 (CCB
1997) (forfeiture rescinded where trustee was appointed in
Chapter 7 liquidation, removing violator from operating as a
common carrier and from involvement in dissolution or
distribution of assets. Requiring trustee to pay the
forfeiture would diminish estate assets available to innocent
creditors and serve no public interest purpose.).
9 See 11 U.S.C. § 362(b)(4). See Coleman Enterprises,
Inc., 16 FCC Rcd 24385, 24389 n. 28 (2000) (filing for chapter
11 bankruptcy does not preclude the Commission from issuing an
Order of Forfeiture). See also United States of America v.
Commonwealth Companies, Inc., 913 F.2d 518 (8th Cir. 1990).
10 47 C.F.R. §§ 0.111, 0.311, 1.80(f)(4).
11 47 U.S.C. § 504(a).
12 See 47 C.F.R. § 1.1914.