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Before the
Federal Communications Commission
Washington, D.C. 20554
In the Matter of )
) File No. EB-04-SE-069
) NAL/Acct No. 200632100005
Behringer USA, Inc. ) FRN 0014638803
NOTICE OF APPARENT LIABILITY FOR FORFEITURE AND ORDER
Adopted: February 16, 2006 Released: February
16, 2006
By the Commission:
I. INTRODUCTION
1. In this Notice of Apparent Liability for
Forfeiture (``NAL'') and Order, we find that
Behringer USA, Inc. (``Behringer'') marketed 50
models of unauthorized radio frequency devices
specifically, digital audio music devices, in
apparent willful and repeated violation of Section
302(b) of the Communications Act of 1934, as
amended (``Act''),1 and Section 2.803(a) of the
Commission's Rules (``Rules'').2 Significantly, we
find that Behringer continued to import and market
substantial numbers of these unauthorized devices
for more than a year after the Enforcement Bureau
initiated an inquiry into Behringer's compliance
with the Commission's equipment authorization
requirements. Based on the facts and circumstances
before us, including the egregious nature of
Behringer's continued non-compliance, we conclude
that Behringer is apparently liable for a
forfeiture in the amount of one million dollars
($1,000,000).
II. BACKGROUND
2. Section 302 of the Act authorizes the Commission
to make reasonable regulations, consistent with the
public interest, governing the interference
potential of equipment that emits radio frequency
energy, and prohibits, inter alia, the offering for
sale of radio frequency devices to the extent such
activity does not comply with those regulations.
The purpose of this section is to ensure that radio
transmitters and other electronic devices meet
certain standards to control interference before
they reach the market. The Commission carries out
its responsibilities under Section 302 in two ways.
First, the Commission establishes technical
regulations for transmitters and other equipment to
minimize their potential for causing interference
to radio services. Second, the Commission
administers an equipment authorization program to
ensure that equipment reaching the market complies
with the technical requirements.3 The equipment
authorization program requires that radio frequency
equipment be tested for compliance with applicable
technical requirements in accordance with one of
three authorization procedures -- certification,
Declaration of Conformity, or verification4 --
prior to the initiation of marketing.
``Marketing'' includes the sale or lease, offer for
sale or lease (including advertising for sale or
lease), importing, shipping, and/or distribution
for the purpose of selling or leasing or offering
for sale or lease.5
3. Section 302(b) of the Act provides that
``[n]o person shall manufacture, import, sell,
offer for sale, or ship devices or home electronic
equipment and systems, or use devices, which fail
to comply with regulations promulgated pursuant to
this section.'' Section 2.803(a)(2) of the
Commission's implementing regulations provides
that:
... [N]o person shall sell or lease, or offer for
sale or lease (including advertising for sale or
lease), or import, ship, or distribute for the
purpose of selling or leasing or offering for sale
or lease, any radio frequency device unless ...
[i]n the case of a device that is not required to
have a grant of equipment authorization issued by
the Commission, but which must comply with the
specified technical standards prior to use, such
device also complies with all applicable
administrative (including verification of the
equipment or authorization under a Declaration of
Conformity, where required), technical, labeling
and identification requirements specified in this
chapter.
Under Section 15.101 of the Rules,6 certain Class B digital
devices,7 such as digital audio music devices marketed to
the general public, must be authorized in accordance with
the verification procedure prior to marketing.
Specifically, Class B digital devices must be tested and
verified as compliant with the conducted emission limits and
radiated emission limits set forth in Sections 15.107 and
15.109 of the Rules,8 must be labeled as specified in
Section 15.19(a)(3) of the Rules,9 and must comply with the
user manual requirements set forth in Section 15.105(b) of
the Rules.10 Additionally, if such devices are imported into
the United States, the importer must submit a declaration to
Customs (on FCC Form 740, or electronically, where
electronic filing is available) indicating that the devices
meet one of the conditions for entry into the United
States.11
4. In March 2004, the Bureau received a
complaint alleging that Behringer was marketing
digital audio equipment that was not labeled and
therefore may not have been authorized in
accordance with the Commission's equipment
authorization requirements. In response to the
complaint, the Bureau issued Behringer a letter of
inquiry (``First LOI'') on March 29, 2004.12
Behringer responded to the First LOI on April 19,
2004.13
5. In its response to the First LOI, Behringer
stated that, in January 2000, it began importing,
marketing, distributing for sale and selling in the
United States digital audio products, such as
mixers, amplifiers, and digital effects processors
(``digital devices''). The information provided by
Behringer indicated that, since January of 2000, it
imported, marketed and distributed for sale at
least 66 different models of digital devices. A
listing of these 66 models is included in
Attachment A. Behringer further stated that, from
January 2000 through April 2004, it manufactured
approximately 1.33 million of its digital devices
for sale in the United States,14 and actually
imported approximately 1.17 million of its digital
devices, which it distributed to approximately
2,000 retailers for sale in the United States.15
6. Behringer acknowledged that its audio
products are Class B digital devices subject to the
Commission's equipment verification and related
requirements,16 including the applicable technical
standards.17 Behringer also acknowledged that it
had not verified compliance of any of the 66 models
of its digital devices with the applicable FCC
technical standards, prior to importing and
marketing such devices in the United States.18
Rather, Behringer represented that ``a range'' of
its digital devices had been tested and passed
``CE'' directives,19 and expressed its belief that
those devices will also comply with the
Commission's technical standards given ``the
relationship between the applicable FCC and CE
electromagnetic compatibility regulations and the
results of Behringer's CE tested products to
date.''20 Test reports subsequently submitted by
Behringer showed that only one model was tested for
CE compliance before Behringer began importing and
marketing its digital devices in the United States
in January 2000 and that 7 additional models were
tested for CE compliance prior to issuance of the
First LOI on March 29, 2004.21
7. Additionally, Behringer represented that,
after receiving the Bureau's First LOI, it
initiated measures to ensure compliance with the
Commission's equipment verification standards and
related requirements. Behringer represented that
it engaged a test laboratory to test all of its
digital products, and that it would submit the test
results as they become available.22 Behringer also
represented that it would ensure that all of its
digital devices marketed and sold in the United
States are properly labeled and that the
accompanying instruction manuals include the
requisite information.23 Further, Behringer
represented that ``[o]n a going-forward basis, [it]
would ensure that the Commission's Form 740 is
submitted for each radio frequency device, as
defined in 47 U.S.C. § 302 and 47 C.F.R. §2.801,
which is imported into the Customs territory of the
United States.''24
8. Subsequently, Behringer supplemented its LOI
response with copies of test reports demonstrating
compliance of 14 of its 66 models of digital
devices with the Commission's conducted and
radiated emission limits.25 However, further
investigation by Bureau staff revealed that
Behringer was continuing to market the remaining
models of digital devices for which it had not yet
provided test reports demonstrating compliance with
the Commission's technical standards.26
Furthermore, a review of importation data
maintained by Customs revealed that Behringer
apparently was not submitting FCC Form 740s for the
digital devices which it imported into the United
States, as represented in its LOI response.
Accordingly, on December 29, 2004, the Bureau
issued Behringer a Further LOI.27 Behringer
responded to the Further LOI on February 15,
2005.28
9. In its response to the Further LOI, Behringer
admitted that it ``has exported additional products
to the United States that have not yet been tested
for compliance with the Commission's Rules.''29
Behringer specifically admitted that since the
Bureau issued the First LOI in March of 2004, it
imported 93,620 units and sold 100,304 units of
digital devices that had not yet been tested for
compliance with the FCC's rules.30 Behringer also
admitted that, notwithstanding its prior
commitment, it ``did not submit the Commission's
Form 740 when importing its Class B digital radio
frequency devices into the United States,''31 and
only began to file the forms in February 2005,
after it received the Further LOI.32
10. Following receipt of the Further LOI,
Behringer submitted test reports demonstrating
compliance of an additional 14 models of its
digital devices with the Commission's technical
standards. To date, Behringer has submitted test
reports demonstrating compliance of only 28 of the
66 models of digital devices with the Commission's
technical requirements.33
11. Of the 28 models that Behringer has
tested and verified as compliant with the
Commission's technical standards, 16 models were
tested and verified more than one year prior to the
date of this NAL. The marketing of these 16 models
prior to verification are therefore beyond the
applicable one-year statute of limitations and are
not subject to this NAL.34 Accordingly, this NAL
takes into account only 50 of the 66 models of
unauthorized Class B digital devices marketed by
Behringer in the United States.35 The Enforcement
Bureau confirmed through advertisements and price
lists on Behringer's website that it marketed these
50 models within the past year.
III. DISCUSSION
12. Under Section 503(b)(1)(b) 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.36 To
impose such a forfeiture penalty, the Commission
must issue a notice of apparent liability and the
person against whom such notice has been issued
must have an opportunity to show, in writing, why
no such forfeiture penalty should be imposed.37
The Commission will then issue a forfeiture if it
finds by a preponderance of the evidence that the
person has violated the Act or a Commission rule.38
As set forth in detail below, we conclude under
this standard that Behringer is apparently liable
for forfeiture for its apparent willful and
repeated violations of Sections 302(b) of the Act
and Section 2.803(a) of the Rules.
13. The fundamental issue in this case is whether
Behringer apparently violated the Act and the
Commission's rules by willfully or repeatedly
marketing unauthorized radio frequency devices.
Based on a preponderance of the evidence, we
conclude that Behringer is apparently liable for a
forfeiture of $1,000,000 for apparently willfully
and repeatedly violating Section 302(b) of the Act
and Section 2.803(a) of the Rules.
14. Specifically, we propose base forfeitures of
$7,000 for each of the 50 models of unauthorized
digital devices it marketed in the United States
within the last year. Additionally, we propose
upward adjustments to this aggregate base
forfeiture of $350,000 based on the egregious
nature of Behringer's misconduct, its relative
disincentive to comply (ability to pay a
forfeiture), and the substantial economic gain it
derived from its continued marketing of
unauthorized devices after the Enforcement Bureau
began its investigation. Although we propose
forfeitures only for apparent violations within the
applicable one year statute of limitations, we
discuss below the history of Behringer's
noncompliance in prior years to demonstrate the
scope of its misconduct and to provide sufficient
context for the misconduct that is within the
statute of limitations period and thus covered by
this NAL.
A. Marketing of unauthorized digital devices
15. We conclude that Behringer apparently
violated Section 302(b) of the Act and Section
2.803(a) of the Rules by willfully and repeatedly
marketing unauthorized digital audio devices in the
United States. Since January 2000, Behringer has
imported and marketed in the United States, 66
models of unauthorized digital devices. Between
January 2000 and March 2004, Behringer imported
approximately 1.17 million unauthorized digital
devices for sale in the United States.
Additionally, between April 2004 -- when Behringer
represented in its response to the First LOI that
it had initiated measures to ensure compliance with
the Commission's equipment verification
requirements -- and February 2005 -- when Behringer
responded to the Further LOI -- Behringer continued
to import and market in the United States
unauthorized digital devices. Specifically,
Behringer acknowledged that it imported 93,620
unauthorized devices and sold 100,304 unauthorized
devices in the United States after the Enforcement
Bureau began its investigation into Behringer's
compliance with the equipment authorization
requirements. Moreover, the record establishes
that Behringer continued to market a total of 50
models of unauthorized devices in the United States
during the past year. Furthermore, notwithstanding
its representations in April 2004 that it would
submit test reports demonstrating compliance of all
66 of its digital products, to date Behringer still
has not submitted test reports verifying compliance
of 38 models.39
16. Under Sections 2.909(b) and 2.953(b) of
the Rules,40 Behringer, as the manufacturer and
importer of Class B digital devices, is the party
responsible for ensuring that all its models of
audio products are tested and verified as compliant
with the applicable technical equipment standards
before such products are imported into and marketed
in the United States. Although Behringer stated
that, prior to the issuance of the First LOI, it
tested a range of devices for ``CE'' compliance,
the record established that Behringer, in fact,
only tested a small number models for CE
compliance.41 Irrespective of the number of models
tested for CE compliance, we note that such testing
neither is the equivalent of nor demonstrates
compliance with the Commission's technical
standards.
17. Accordingly, based on the preponderance
of the evidence, we find that Behringer apparently
violated, and continues to violate more than a year
after receiving the First LOI from the Enforcement
Bureau, Section 302(b) of the Act and Section
2.803(a) of the Rules by marketing unauthorized
Class B digital devices in the United States.
Within the last year specifically, which is the
time period covered by this NAL, Behringer
apparently marketed 50 models of unauthorized Class
B digital devices in the United States.
B. Proposed Forfeiture.
18. Section 503(b) of the Act and Section
1.80(a) of the Rules provide that any person who
willfully or repeatedly fails to comply with the
provisions of the Act or the Rules shall be liable
for a forfeiture penalty. Based upon the record
before us, it appears that Behringer's violations
of Section 302(b) of the Act and Section 2.803(a)
of the Rules were willful and repeated.
19. Section 1.80(b)(4) of the Rules
establishes a base forfeiture amount of $7,000 for
each violation involving the importation or
marketing of unauthorized equipment.42 Section
503(b)(2)(C) of the Act, however, authorizes the
Commission to assess a maximum forfeiture of
$11,000 for each violation, or each day of a
continuing violation, up to a statutory maximum
forfeiture of $97,500 for any single continuing
violation.43 In determining the appropriate
forfeiture amount, Section 503(b)(2)(D) of the Act
directs the Commission to consider factors, such as
``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 such other matters as
justice may require.''44 In the present case, we
find that each instance of marketing of an
unauthorized model constitutes a separate and
continuing violation, and, as discussed below, we
find that the circumstances presented warrant a
substantial proposed forfeiture amount.
20. Section 503(b)(6) of the Act bars the
Commission from proposing a forfeiture for
violations that occurred more than a year prior to
the issuance of an NAL.45 However, Section
503(b)(6) does not bar the Commission from
assessing whether Behringer's conduct prior to that
time period apparently violated the provisions of
the Act and Rules and from considering such conduct
in determining the appropriate forfeiture amount
for violations that occurred within the one-year
statutory period.46 Thus, while we may consider
the fact that Behringer's conduct has continued
over a five-year span, the forfeiture amount we
propose herein relates only to Behringer's apparent
violations that have occurred within the past year.
21. The record establishes that within the
past year, Behringer has marketed 50 models of
unauthorized Class B digital devices within the
United States. Consequently, we initially find
that Behringer is apparently liable for a base
forfeiture of $7,000 for each of these 50 models of
unauthorized devices for a total base forfeiture of
$350,000. That base forfeiture amount is, however,
subject to an upward adjustment.
22. Having considered the statutory factors
enumerated above, we conclude that a substantial
upward adjustment is warranted. We find the
violations here particularly egregious because
Behringer continued to import and market a
substantial volume of unauthorized Class B digital
devices for more than a year after the Bureau
initiated its investigation. In this regard, we
note that Behringer imported 93,620 unauthorized
units and sold 100,304 unauthorized units after
representing in its response to the First LOI that
it would file the requisite import declarations on
FCC Form 740 for any digital devices imported into
the United States.47 We also believe that an
upward adjustment of the base forfeiture is
warranted based on the substantial economic gain
Behringer derived from its marketing of the
unauthorized devices. We observe, in this
connection, that the total retail sales of the
100,304 unauthorized devices that Behringer sold in
the United States after the Bureau initiated its
investigation amounted to approximately $28.5
million.48 Moreover, we take into account the fact
that Behringer's violations have continued for more
than five years overall and more than one year
after the Bureau initiated its investigation.
Finally, we take into account Behringer's high
revenues and ability to pay a forfeiture in
determining the appropriate forfeiture amount. As
the Commission made clear in the Forfeiture Policy
Statement, companies with higher revenues, such as
Behringer,49 could expect forfeitures higher than
those reflected in the base amounts.50
23. Accordingly, we propose an aggregate
forfeiture of $1,000,000 for Behringer's apparent
willful and repeated violation of Section 302(b) of
the Act and Section 2.803(a) of the Rules. In
proposing the $1,000,000 forfeiture, we recognize
that it is substantially higher than the base
forfeiture amount of $350,000. We also recognize
that the proposed forfeiture amount substantially
exceeds the forfeiture amounts proposed in recent
equipment cases. Specifically, we recently
proposed a $75,000 forfeiture against a
manufacturer for advertising one model of an
unauthorized device in various venues,51 and
proposed a $125,000 forfeiture against a retailer
for selling several models of unauthorized devices
on thirteen occasions.52 We believe, however, that
because Behringer marketed a significantly larger
number of models and units of unauthorized devices,
and given the other factors discussed above,
particularly Berhinger's failure to live up to the
representations made in its response to the
Bureau's First LOI, the substantial upward
adjustment of the base forfeiture amount is fully
warranted. Furthermore, we note that $1,000,000
proposed forfeiture amount is substantially lower
than the straightforward application of the
applicable maximum statutory forfeiture amount of
$4,875,000.53 We believe, however, that the
forfeiture proposed will sufficiently deter
Behringer's future violations of the Act and the
Rules.
24. Finally, we note that, following the
Enforcement Bureau's issuance of the LOIs,
Behringer did take some initial steps to comply
with the Commission's equipment authorization and
related requirements. These efforts, however, do
not warrant reduction of the proposed forfeiture
amount. First, implementation of corrective
measures in response to an LOI is expected, and
thus does not nullify or mitigate past
violations.54 Second, Behringer committed to even
greater remedial actions in its response to the
First LOI than it has achieved to date. Indeed, it
appears that Behringer's measures still have not
brought all of its devices into compliance with the
relevant FCC rules. Given the continuing nature of
Behringer's violations, we will require Behringer
to submit an affidavit, signed by an officer or
director of the licensee, to the Enforcement Bureau
within 30 days of the release of this NAL, stating
whether it has complied with Sections 302(b) of the
Act and Sections 2.803(a) of the Rules with respect
to each model which it is currently importing and
marketing in the United States, and if not,
providing its plans for full compliance.
Behringer's failure to submit the affidavit, or
failure to comply with the applicable equipment
requirements, may subject the company to further
appropriate enforcement action.
IV. ORDERING CLAUSES
25. Accordingly, IT IS ORDERED that,
pursuant to pursuant to Section 503(b) of the Act55
and Sections 0.111, 0.311 and 1.80 of the Rules,56
Behringer USA, Inc., IS NOTIFIED of its APPARENT
LIABILITY FOR A FORFEITURE in the amount of one
million dollars ($1,000,000) for willfully and
repeatedly violating Section 302(b) of the Act and
Section 2.803(a) of the Rules.
26. IT IS FURTHER ORDERED that, pursuant to
Section 1.80 of the Rules, within thirty days of
the release date of this Notice of Apparent
Liability for Forfeiture, Behringer USA, Inc. SHALL
PAY the full amount of the proposed forfeiture or
SHALL FILE a written statement seeking reduction or
cancellation of the proposed forfeiture.
27. 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
No. referenced above. Payment by check or money
order may be mailed to Federal Communications
Commission, P.O. Box 358340, Pittsburgh, PA 15251-
8340. Payment by overnight mail may be sent
to Mellon Bank /LB 358340, 500 Ross Street, Room
1540670, Pittsburgh, PA 15251. Payment by wire
transfer may be made to ABA Number 043000261,
receiving bank Mellon Bank, and account number 911-
6106.
28. The response, if any, must be mailed to
the Office of the Secretary, Federal Communications
Commission, 445 12th Street, S.W., Washington, D.C.
20554, ATTN: Enforcement Bureau - Spectrum
Enforcement Division, and must include the
NAL/Acct. No. referenced in the caption.
29. 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; 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.
30. Requests for payment of the full amount
of this NAL under an installment plan should be
sent to: Chief, Revenue and Receivable Operations
Group, 445 12th Street, S.W., Washington, D.C.
554.57
31. IT IS FURTHER ORDERED that, pursuant to
Section 403 of the Act,58 Behringer USA, Inc., must
submit the affidavit described in paragraph 23
above, within 30 days from the release of this NAL,
to: Federal Communications Commission, Enforcement
Bureau, Spectrum Enforcement Division, 445 12th
Street, S.W., Washington, D.C. 20554, Attention:
Ava Holly Berland.
32. IT IS FURTHER ORDERED that a copy of
this Notice of Apparent Liability for Forfeiture
shall be sent by first class mail and certified
mail return receipt requested to Delbert D. Smith,
Esq. and Michael J. Mendelson, Esq., Jones Day, 51
Louisiana Avenue, N.W., Washington, D.C. 20001-
2113, counsel to Behringer USA, Inc.
FEDERAL COMMUNICATIONS
COMMISSION
Marlene H. Dortch
Secretary Attachment A
Behringer Unauthorized Class B Digital Devices Marketed in
the United States
Type of Models #s Date of Total # of Total # of
Device Test Report Unauthor- Unauthor-
Demonstrat- ized ized
ing Devices Devices
Compliance Imported Sold After
with FCC After First First LOI
Standards LOI
Dynamic
Processors DSP9024 4 450
AES/EBU 206
9024
DSP1424P 2/24/2005 2/
Equalizers DEQ2496 5/11/20041 2/
DEQ1024 2606 696
AES/EBU 49
8024
Microphone
Preamps VX2496 852
Digital
Effects
Processors REV2496 3/13/2005 4753 565
DSP2024P 6/24/20041/ 2/
DSP1224P 2/24/2005 5
Audio
Solutions DSP1124P 2/24/2005 2803 11212
DSP110 1405 4319
ADA8000 5665 8161
SRC2496 456
SRC2000 179
CT100 2/
UB Series
Mixing
Consoles UB2442FX- 5/11/20041/ 2/
PRO
UB2222FX- 5/5/20041/ 2/
PRO
UB1832FX- 5/11/20041/ 2/
PRO
UB1622FX- 5/11/20041/ 2/
PRO
UB1222FX- 4/14/20041/ 2/
PRO
UB1204FX- 6/24/20041/ 2/
PRO
UB1204-PRO 6/23/20041/ 2/
Analog
Mixing
Consoles SL3242FX- 7543 5567
PRO
SL2442FX- 6480 3007
PRO
MX3242X 410 1442
Digital
Mixing
Consoles DDX3216 300 1204
ADT1616 335 846
TDF1616 69
AES808/ACB- 2/
808P
Powered
Mixers PMH5000 3/1/2005 7400 1702
PMH3000 3/1/2005 15092 4804
PMH1000 4/6/2005 11378 1044
PMH880S 5979 1061
PMH660M 5/2//2005 2/
PMH2000 8/3/20041/ 2/
Attachment A (cont'd)
Type of Model #s Date of Total # of Total # of
Device Test Report Unauthor- Unauthor-
Demonstrat- ized ized
ing Devices Devices
Compliance Imported Sold After
with FCC After First First LOI
Standards LOI
DJ Mixers VMX1000 2/17/2005 14068 7437
VMX300 2/16/2005 1245
VMX200 2/
VMX100 4/13/20041/ 2/
DJX700 3/14/2005 12401 10909
DJX400 1217
DX626 352 1643
DX052 75 1265
DJ Gear DFX69 2/
Modeling
Amp V-AMP PRO 2/
V-AMP2 4/13/20041/ 2/
X V-AMP 2/
BASS V-AMP 3/3/2005 2/
PRO
BASS V-AMP 2/
LX1200H 3455 685
LX1-112 4/13/20041/ 2/
Guitar Amp GMX1200H 1645 565
GMX212 6/11/20041/ 2/
GMX210 9/20/20041/ 2/
GMX110 4/13/20041/ 7250 6009
AC112 169 2085
GX112 2/
ACX1000 1906 8134
Instrument
Amp
Accessories FCB1010 2/
Pro Lighting
Systems
LC2412 2/
BLM420 2/
LD6230 2/
Audio
Interfaces BCA2000 2960 744
Controllers BCF2000 5191 3052
BCR2000 4961 1213
1/These models are beyond the applicable one-year statute of
limitations because Behringer tested and verified these
models as compliant with FCC technical standards more than
one year prior to the date of this NAL.
2/Although Behringer did not report any sales of these
models during the period between April 2004 (when Behringer
submitted its response to the First LOI) and February 2005
(when Behringer submitted its response to the Further LOI),
Enforcement Bureau staff confirmed from advertisements and
price lists on Behringer's website that it was continuing to
market these models in the United States.
_________________________
1 47 U.S.C. § 302a(b).
2 47 C.F.R. § 2.803(a).
3 47 C.F.R. Part 2, Subpart J.
4 Certification is an equipment authorization issued by the
Commission or one of its designated Telecommunications
Certification Bodies, based on representations and test
data submitted by the applicant. 47 C.F.R. § 2.907(a). A
Declaration of Conformity is a procedure where the
responsible party - the manufacturer, or in the case of
imported equipment, the importer - makes measurements or
takes other necessary steps to ensure that the equipment
complies with the appropriate technical standards. 47
C.F.R. § 2.906(a). Under the Declaration of Conformity
procedure, the measurements must be made by an FCC-
accredited laboratory. 47 C.F.R. § 2.948(a)(3). In
addition, a copy of the Declaration of Conformity listing
the party responsible for compliance must be included in
the literature supplied with the product. 47 C.F.R. §
2.1077. Verification is also a procedure where the
manufacturer, or in the case of imported equipment, the
importer, makes measurements or takes the necessary steps
to ensure that the equipment complies with the appropriate
technical standards. However, unlike the Declaration of
Conformity procedure, it does not require that an
accredited laboratory make the measurements or that a
Declaration of Conformity be supplied with the equipment.
47 C.F.R. § 2.902(a).
5 47 C.F.R. § 2.803(e)(4).
6 47 C.F.R. § 15.101.
7 A Class B digital device is ``a device marketed for use
in a residential environment notwithstanding use in
commercial, business and industrial environments.'' 47
C.F.R. § 15.3(i).
8 47 C.F.R. §§ 15.107, 15.109.
947 C.F.R. § 15.19(a)(3).
10 47 C.F.R. § 15.105(b).
11 47 C.F.R. §§ 2.1203-2.1205.
12 See Letter from Joseph P. Casey, Chief, Spectrum
Enforcement Division, Enforcement Bureau, Federal
Communications Commission to Doug White, President,
Behringer USA, Inc. (March 29, 2004) (``First LOI'').
13 See Letter from Delbert D. Smith, Esq. and Michael J.
Mendelson, Esq., Jones Day to Brian Butler, Assistant
Chief, Spectrum Enforcement Division, Enforcement Bureau,
Federal Communications Commission (dated April 19, 2004)
(``LOI Response'').
14 LOI Response at 2.
15 LOI Response at 1.
16 Id. at 4.
17 Id. at 3-4.
18 Id. at 3-5.
19 The ``CE'' mark is an abbreviation of Conformité
Européenne (French for European Conformity) that indicates
conformity with European safety requirements.
20 LOI Response at 3, 5.
21 Further LOI Response at 1, Exhibits 2.
22 LOI Response at 4. In this connection, Behringer
stated that it instructed Mitsubishi Electric Europe, B.V.,
of Dusseldorf, Germany, to ``carry out testing on all of
its digital products for compliance with FCC Rules 15.107
and 15.109.'' Id. at 3.
23 Id. at 5-6. In the latter connection, Behringer also
stated that it was updating the ``instruction manuals which
include the required statement available to its U.S.
distributors and to U.S. purchasers of Behringer equipment
over its website at www.behringer.com.'' Id. at 6.
24 Id. at 5.
25 See Attachment A.
26 Specifically, Bureau staff observed that Behringer was
continuing to market the devices on its website.
27 Letter from Joseph P. Casey, Chief, Spectrum Enforcement
Division, Enforcement Bureau, Federal Communications
Commission to Doug White, President, Behringer USA, Inc.
(December 29, 2004) (``Further LOI'').
28 Letter from Delbert D. Smith, Esq. and Michael J.
Mendelson, Esq., Jones Day to Brian Butler, Assistant
Chief, Spectrum Enforcement Division, Enforcement Bureau,
Federal Communications Commission (dated February 15, 2005)
(``Further LOI Response'').
29 Further LOI Response at 3.
30 Id. at Exhibit 4. See also Attachment A.
31 Id. at 4.
32 Behringer attributed its initial failure to file the FCC
Form 740s to reliance upon its custom broker's erroneous
advice. We note, however, that Behringer's reliance upon
its broker's advice does not relieve it of its
responsibility, and its prior commitment, to comply with the
filing requirements. See 47 C.F.R. § 2.1203(a); see also
Eure Family Limited Partnership, 17 FCC Rcd 21861, 21863-64
(2002); Wagenvoord Broadcasting Co., 35 FCC 2d 361, 361-63
(1972).
33 See Attachment A.
34 47 U.S.C. § 503(b)(6)(B).
35 See Attachment A; but see supra discussion at ¶ 20.
36 47 U.S.C. § 503(b)(1)(B); 47 C.F.R. § 1.80(a)(1).
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. 47
U.S.C. § 312(f)(1). The legislative history of Section
312(f)(1) of the Act clarifies that this definition of
willful applies to both Sections 312 and 503(b) of the Act,
H.R. Rep. No. 97-765, 97th Cong. 2d Sess. 51 (1982), and
the Commission has so interpreted the term in the Section
503(b) context. See, e.g., Southern California
Broadcasting Co., 6 FCC Rcd 4387, 4388 (1991) (``Southern
California''). The Commission may also assess a forfeiture
for violations that are merely repeated, and not willful.
See, e.g., Callais Cablevision, Inc., 16 FCC Rcd 1359
(2001) (``Callais Cablevision'') (issuing a notice of
apparent liability for forfeiture for, inter alia, a cable
television operator's repeated signal leakage). The term
``repeated'' means that the act was committed or omitted
more than once, or lasts more than one day. Callais
Cablevision, 16 FCC Rcd at 1362, ¶ 9; Southern California,
6 FCC Rcd at 4388, ¶ 5.
37 47 U.S.C. § 503(b); 47 C.F.R. § 1.80(f).
38 See, e.g., SBC Communications, Inc., 17 FCC Rcd 7589,
7591, ¶ 4 (2002).
39 See supra note 33 and accompanying text.
40 47 C.F.R. §§ 2.909(b), 2.953(b) (identifying the
manufacturer of radio frequency devices subject to
authorization under the verification procedure, or the
importer in the case of imported devices, as the
responsible party).
41 See supra note 20.
42 47 C.F.R. § 1.80(b)(4).
43 47 U.S.C. § 503(b)(2)(C). The Commission twice amended
Section 1.80(b)(3) of the Rules, 47 C.F.R. § 1.80(b)(3), to
increase the maxima forfeiture amounts, in accordance with
the inflation adjustment requirements contained in the Debt
Collection Improvement Act of 1996, 28 U.S.C. § 2461. See
Amendment of Section 1.80 of the Commission's Rules and
Adjustment of Forfeiture Maxima to Reflect Inflation, 15
FCC Rcd 18221 (2000) (adjusting the maximum statutory
amounts from $10,000/$75,000 to $11,000/$87,500); Amendment
of Section 1.80 of the Commission's Rules and Adjustment of
Forfeiture Maxima to Reflect Inflation, 19 FCC Rcd 10945
(2004) (adjusting the maximum statutory amounts from
$11,000/$87,500 to $11,000/$97,500); see also 47 C.F.R. §
1.80(c).
44 47 U.S.C. § 503(b)(2)(D). See also 47 C.F.R. §
1.80(b)(4), Note to paragraph (b)(4): Section II.
Adjustment Criteria for Section 503 Forfeitures.
45 47 U.S.C. § 503(b)(6).
46 See 47 U.S.C. § 503(b)(2)(D), 47 C.F.R. § 1.80(b)(4);
see also Globcom, Inc. d/b/a Globcom Global Communications,
18 FCC Rcd 19893, 19903 ¶ 23 (2003), rev. pending;
Roadrunner Transportation, Inc., 15 FCC Rcd 9669, 9671-71 ¶
8 (2000); Cate Communications Corp., 60 RR 2d 1386, 1388 ¶
7 (1986); Eastern Broadcasting Corp., 10 FCC 2d 37, 37-38 ¶
3 (1967); Bureau D'Electronique Appliquee, Inc., 20 FCC Rcd
3445, 3447-48 ¶¶ 8-9 (Enf. Bur., Spectrum Enf. Div. 2005).
47 It was implicit in Behringer's representation that it
would file the requisite import declarations that any
imported devices would be in compliance with the
Commission's equipment authorization requirements. See 47
C.F.R. § 2.1204 (specifying the conditions for importation
of radio frequency devices).
48 We estimated the total retail sales of these
unauthorized devices using price lists found on Behringer's
website. While we recognize that Behringer's gross
revenues from its sale of these unauthorized devices is
less than the retail sales, we think it is obvious that
Behringer realized substantial revenues from its sale of
these unauthorized devices.
49 Since Behringer was founded in 1989, Behringer ``has
reported a continuous 40 percent annual growth and a 130
million US dollar turnover in 2003.'' Press Release, Happy
Birthday, Behringer! Behringer Announces its 15th
Anniversary at the Frankfurt Prolight+Sound 2004 (March 31,
2004), www.behringer.com.
50 Specifically, the Commission stated:
[O]n the other end of the spectrum of potential
violations, we recognize that for large or highly
profitable communication entities, the base forfeiture
amounts ... are generally low. In this regard, we are
mindful that, as Congress has stated, for a forfeiture
to be an effective deterrent against these entities,
the forfeiture must be issued at a high level .... For
this reason, we caution all entities and individuals
that, independent from the uniform base forfeiture
amounts ..., we intend to take into account the
subsequent violator's ability to pay in determining the
amount of a forfeiture to guarantee that forfeitures
issued against large or highly profitable entities are
not considered merely an affordable cost of doing
business. Such large or highly profitable entities
should expect in this regard that the forfeiture amount
set out in a Notice of Apparent Liability against them
may in many cases be above, or even well above, the
relevant base amount.
Forfeiture Policy Statement, 12 FCC Rcd at 17099-100.
51 ACR Electronics, Inc., 19 FCC Rcd at 22303 ¶ 24.
52 Pilot Travel Centers, L.L.C., 19 FCC Rcd 23113, 23117 ¶¶
15-17 (2004).
53 See supra note 43 and accompanying text, permitting a
maximum of $97,500 for each of the 50 instances of apparent
violations.
54 See AT&T Wireless Services, Inc., 17 FCC Rcd 7891
(2002), forfeiture ordered, 17 FCC RCd 21866, 21875-76 ¶¶
26-28 (2002); Seawest Yacht Brokers, 9 FCC Rcd 6099, 6099 ¶
7 (1994); TCI Cablevision of Maryland, Inc., 7 FCC Rcd
6013, 6014 ¶ 8 (1992).
55 47 U.S.C. § 503(b).
56 47 C.F.R. §§ 0.111, 0.311 and 1.80.
57 See 47 C.F.R. § 1.1914.
58 47 U.S.C. § 403.