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Before the
Federal Communications Commission
Washington, D.C. 20554
)
)
In the Matter of File Number EB-07-SE-210
)
CompUSA, Inc. NAL/Acct. No. 200832100037
)
Dallas, Texas FRN # 0016647513
)
)
NOTICE OF APPARENT LIABILITY FOR FORFEITURE
Adopted: April 9, 2008 Released: April 10, 2008
By the Commission:
I. INTRODUCTION
1. In this Notice of Apparent Liability for Forfeiture ("NAL"), we find
that CompUSA, Inc. ("CompUSA") apparently willfully and repeatedly
violated Section 15.117(k) of the Commission's Rules ("Rules") by
failing to place the required Consumer Alert label immediately
adjacent to and clearly associated with television receiving equipment
that contains an analog broadcast television tuner but does not
contain a digital broadcast television tuner (hereinafter "analog-only
tuner") that it displayed or offered for sale or rent. We conclude,
pursuant to Section 503(b) of the Communications Act of 1934, as
amended ("Act"), that CompUSA is apparently liable for a forfeiture in
the amount of one hundred sixty eight thousand dollars ($168,000).
II. BACKGROUND
2. Congress has established February 17, 2009 as the deadline for the end
of analog transmissions for full power television stations. The
Commission is statutorily obligated to promote the orderly transition
to digital television, "a critical step in the evolution of broadcast
television." As we stated previously, "[w]e are committed to ensuring
the rapid completion of that transition in a way that delivers the
greatest possible benefits to the viewing public." As part of that
commitment and in light of the upcoming deadline, we recently
announced that "it is necessary and appropriate to require retailers
to provide consumers with information regarding this transition date
at the point of sale." We reached this conclusion after determining
that consumer electronics industry efforts had not adequately informed
consumers how analog-only television equipment purchased now will
function when the transition to digital broadcasting ends.
3. To ensure that consumers do not inadvertently buy analog-only
television equipment without understanding that such devices will not
be capable of receiving off-the-air television reception of digital
signals after analog broadcasting ends unless connected to a
digital-to-analog converter or a digital subscription service, we
adopted rules requiring anyone that sells, offers for sale, or rents
television receiving equipment that does not contain a digital
television ("DTV") tuner to display a Consumer Alert at the point of
sale. This requirement also applies to the sale or rent of analog-only
television receiving equipment via direct mail, catalog, or electronic
means (e.g., the Internet). These requirements are contained in
Section 15.117(k) of the Rules, which became effective on May 25,
2007.
4. Section 15.117(k)(3) of the Rules requires that the Consumer Alert
contain the following language:
CONSUMER ALERT
This television receiver has only an analog broadcast tuner and
will require a converter box after February 17, 2009, to receive
over-the-air broadcasts with an antenna because of the Nation's
transition to digital broadcasting. Analog-only TVs should
continue to work as before with cable and satellite TV services,
gaming consoles, VCRs, DVD players, and similar products. For more
information, call the Federal Communications Commission at
1-888-225-5322 (TTY: 1-888-835-5322) or visit the Commission's
digital television website at: www.dtv.gov.
The Consumer Alert must be in a size of type large enough to be clear,
conspicuous and readily legible, consistent with the dimensions of the
equipment and the label. The alert either must be printed on a
transparent material and affixed to the screen, in a manner that is
removable by the consumer and does not obscure the picture when
displayed for sale, or displayed separately immediately adjacent to
each television receiver offered for sale and clearly associated with
the analog-only model to which it pertains. In the case of other
analog-only video devices that do not include a display (e.g., VCRs,
DVD players), the Consumer Alert must be in a prominent location on
the device, such as on the top or front, or displayed separately
immediately adjacent to and clearly associated with the analog-only
model to which it pertains. To the extent that any persons display or
offer for sale or rent via direct mail, catalog, or electronic means
analog-only television receiving equipment, they must prominently
display the Consumer Alert as part of all advertisements or
descriptions of such television receiving equipment, in clear and
conspicuous print, and in close proximity to any images or
descriptions of such equipment.
5. Immediately after the rule became effective, the Commission's
Enforcement Bureau began inspecting hundreds of stores throughout
the country, as well as dozens of popular retailer websites, and
observed many models of analog-only television receiving
equipment on display without the required Consumer Alert labels.
On June 1, 2007, the Enforcement Bureau issued a Citation to
CompUSA for offering for sale television receiving equipment
having an analog-only tuner without displaying the required
Consumer Alert in close proximity. Between June 1, 2007 and June
11, 2007, the Enforcement Bureau conducted inspections at its
website and numerous stores and based on those inspections,
issued additional Citations to CompUSA for violations at its
stores and its website. After affording CompUSA a reasonable
opportunity to respond to the first Citation, on June 12, 2007,
agents and investigators from the Enforcement Bureau began
inspecting numerous CompUSA stores in various states and once
again observed television receiving equipment with analog-only
tuners on display without the required Consumer Alert labels in
eight CompUSA stores.
6. 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. 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. 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 and the Commission has so
interpreted the term in imposing forfeitures pursuant to Section
503(b). The Commission may also assess a forfeiture for
violations that are merely repeated, and not willful. "Repeated"
means that the act was committed or omitted more than once, or
lasts more than one day. 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. 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. As we set forth below, we
conclude under this standard that CompUSA is apparently liable
for forfeiture for its apparent willful and repeated violations
of Section 15.117(k) of the Commission's rules.
III. DISCUSSION
7. Based on the evidence before us, we find that CompUSA apparently
willfully and repeatedly violated Section 15.117(k) of the Rules
by failing to display conspicuously and in close proximity to
equipment with an analog-only tuner, in clear and conspicuous
print, the required Consumer Alert label. Specifically, as
detailed in Attachment B, agents and investigators from the
Enforcement Bureau observed a number of different models of
television receiving equipment having only an analog-only tuner
on display in eight CompUSA stores without the required Consumer
Alert labels. CompUSA previously received four Citations for this
same type of conduct prior to the agents' inspections.
8. Under Section 503(b)(2)(D) of the Act, we may assess an entity
that is neither a common carrier, broadcast licensee or cable
operator a forfeiture of up to $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. In
exercising such authority, we must 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 such other matters as
justice may require."
9. The Commission's Forfeiture Policy Statement and Section 1.80 of
the Rules do not establish a specific base forfeiture for
violation of the analog-only tuner labeling requirements. In
adopting the Consumer Alert labeling requirements, the Commission
stated that "[a]ccurate communication of this impending change is
a highly material disclosure for consumers contemplating the
purchase of a television." We also noted that it is a matter of
public safety for consumers who rely on analog-only televisions
to obtain critical emergency information.
10. Similar issues arose regarding labeling requirements for wireless
hearing aid-compatible handsets. In those cases, the Enforcement
Bureau established a base forfeiture amount of $8,000 per handset
model that failed to comply with the labeling requirements. The
labeling requirements for wireless hearing aid-compatible
handsets and the analog-only tuner labeling requirements both
serve the important goal of ensuring that consumers have access
to necessary information. In light of the similarities in these
labeling requirements, we conclude that a $8,000 base forfeiture
amount per unlabeled model or device in each store where Bureau
agents and investigators observed a violation is appropriate for
apparent violations of Section 15.117(k).
11. We find that, beginning on June 12, 2007, as detailed in
Attachment B, even after receiving the Citations warning of
violations in its stores across the country, CompUSA displayed
numerous different models of equipment with an analog-only tuner
in eight stores without the required Consumer Alert label. As a
result, CompUSA continued to market television receiving
equipment to consumers without adequately warning that the
equipment contained an analog-only television receiver. Those
consumers may not learn of their equipment's limitations until
the analog-only devices cease to receive over-the-air television
signals, long after any period for returning the equipment has
expired. This scenario is precisely the outcome that our rule was
intended to prevent. Applying the analysis set forth above to the
facts of this case, we conclude that CompUSA is apparently liable
for a $168,000 base forfeiture.
IV. ORDERING CLAUSES
12. Accordingly, IT IS ORDERED that, pursuant to Section 503(b) of
the Communications Act of 1934, as amended, and Section 1.80 of
the Commission's Rules, CompUSA, Inc. is hereby NOTIFIED of this
APPARENT LIABILITY FOR A FORFEITURE in the amount of one hundred
sixty eight thousand dollars ($168,000) for violations of Section
15.117(k) of the Rules.
13. IT IS FURTHER ORDERED that, pursuant to Section 1.80 of the
Commission's Rules within thirty days of the release date of this
Notice of Apparent Liability for Forfeiture, CompUSA, Inc. SHALL
PAY the full amount of the proposed forfeiture or SHALL FILE a
written statement seeking reduction or cancellation of the
proposed forfeiture.
14. 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/Account Number and
FRN Number 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. Payment by wire transfer
may be made to ABA Number 021030004, receiving bank TREAS/NYC,
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). Requests for full payment under
an installment plan should be sent to: Chief Financial Officer --
Financial Operations, 445 12th Street, S.W., Room 1-A625,
Washington, D.C. 20554. Please contact the Financial Operations
Group Help Desk at 1-877-480-3201 or Email: ARINQUIRIES@fcc.gov
with any questions regarding payment procedures.
15. The response, if any, must be mailed to Federal Communications
Commission, Enforcement Bureau, and must include the NAL/Acct.
No. referenced in the caption.
16. 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.
17. Requests for payment of the full amount of this Notice of
Apparent Liability for Forfeiture under an installment plan
should be sent to: Associate Managing Director, Financial
Operations, 445 12th Street, S.W., Room 1A625, Washington, D.C.
20554.
18. IT IS FURTHER ORDERED that a copy of this Notice of Apparent
Liability for Forfeiture shall be sent by Certified Mail, Return
Receipt Requested, and regular mail, to Donald J. Evans, Esq.,
Counsel for CompUSA, Inc., 1300 N. 17th St., 11th Floor,
Arlington, VA 22209.
FEDERAL COMMUNICATIONS COMMISSION
Marlene H. Dortch
Secretary
Attachment A
Store #-
Citation No. Release Date
Location
CompUSA Store # 731
C2007325003 June 1, 2007
Plano, Texas
CompUSA website, www.CompUSA.com DA 07-2370 June 6, 2007
CompUSA Store # 508
C200732680004 June 7, 2007
Bayamon, PR
CompUSA Store # 471
C20073264009 June 12, 2007
Norfolk, VA
CompUSA Store # 161
C20073280013 June 15, 2007
Aurora, CO
Attachment B
1. June 12, 2007, CompUSA Store # 344, Knoxville, TN.
Manufacturer Device Model # Forfeiture Amount
Sony DVD Recorder RDR-GX330 $8,000
Lite-on DVD Recorder LVW-1105HC $8,000
Samsung DVD Recorder DVD-VR335 $8,000
Zenith DVD Recorder/VCR XBR617 $8,000
Subtotal $32,000
2. June 12, 2007, CompUSA Store #174, Fresno, CA.
Manufacturer Device Model # Forfeiture Amount
Sony DVD Recorder RDR-GX330 $8,000
Sony DVD Recorder/VCR RDR-VX530 $8,000
LG DVD Recorder/VCR RC199H $8,000
Subtotal $24,000
3. June 13, 2007, CompUSA Store # 727, San Antonio, TX.
Manufacturer Device Model # Forfeiture Amount
Samsung DVD Recorder DVD-R135 $8,000
Lite-on DVD Recorder LVW-5005 $8,000
Subtotal $16,000
4. June 13, 2007, CompUSA Store # 567, Charlotte, NC.
Manufacturer Device Model # Forfeiture Amount
Samsung DVD Recorder DVD-VR335 $8,000
Sony DVD Recorder RDR GX330 $8,000
Subtotal $16,000
5. June 14, 2007, CompUSA Store # 791, Birmingham, AL.
Manufacturer Device Model # Forfeiture Amount
Samsung DVD Recorder DVD-R135 $8,000
Sony DVD Recorder RDR GX330 $8,000
Subtotal $16,000
6. June 14, 2007, CompUSA Store # 297, San Bruno, CA
Manufacturer Device Model # Forfeiture Amount
Sony DVD Recorder RDR GX330 $8,000
Samsung TV LN-S1952W $8,000
Subtotal $16,000
7. June 20, 2007, CompUSA Store # 730, Frisco, TX.
Manufacturer Device Model # Forfeiture Amount
Samsung DVD Recorder DVD-VR335 $8,000
LG DVD Recorder/VCR RC-199H $8,000
Lite-on DVD Recorder LVW-5005 $8,000
Subtotal $24,000
8. July 2, 2007, CompUSA Store #157, Boulder, CO
Manufacturer Device Model # Forfeiture Amount
Sony DVD/VCR SLVD 370P $8,000
Subtotal $8,000
9. October 5, 2007, CompUSA # 337, Tampa, FL
Manufacturer Device Model # Forfeiture Amount
Sony DVDR RDR GX330 $8,000
Subtotal $8,000
10. December 6, 2007, CompUSA # 529, Huntsville, AL
Manufacturer Device Model # Forfeiture Amount
Syntax TV LT20S $8,000
Subtotal $8,000
TOTAL PROPOSED FORFEITURE: $168,000
47 C.F.R. S: 15.117(k).
47 U.S.C. S: 503(b).
2002 Biennial Regulatory Review, Report and Order and Notice of
Proposed Rulemaking, 18 FCC Rcd 13620, 13825 P: 532 (2003).
Id.
Second Periodic Review of the Commission's Rules and Policies
Affecting the Conversion To Digital Television, Second Report and
Order, 22 FCC Rcd 8776 P: 1 (2007) ("Second DTV Periodic Report and
Order").
Id. at P: 10.
Id. at P: 14. See 47 C.F.R. S: 15.117(k). In the Second DTV Periodic
Report and Order, the Commission defined "point of sale" as the "place
where televisions are displayed for consumers prior to purchase." See
Second DTV Periodic Report and Order at n.29.
Second Periodic Review in the Commission's Rules and Policies
Affecting the Conversion to Digital Television, 72 Fed. Reg. 28894-01
(May 23, 2007).
47 C.F.R. S: 15.117(k)(1).
Id.
47 C.F.R. S: 15.117(k)(2).
CompUSA, Inc., Citation No. C2007325003, (Enf. Bur. Dallas Office,
rel. June 1, 2007).
See Attachment A for a list of the citations issued to CompUSA
(collectively "Citations"). In preparing the Citations, Enforcement
Bureau staff relied on publicly available information, including
retailer websites, to identify the television receiving equipment with
analog-only tuners.
We note that following issuance of the citations, the Enforcement
Bureau, after reviewing the devices' technical specifications and user
manuals, determined that the following citation referred to an
erroneously identified equipment model: Citation No. 2007325003
(Samsung Model DVD-VR357). In light of this evidence, we hereby cancel
the relevant portion of the above citation with respect to this model.
See Attachment B for a listing of the stores visited and the models
observed at each store. Enforcement Bureau staff determined that
these models had analog-only tuners by consulting the manufacturer's
product manuals or, if such were unavailable, the models' technical
specifications from CompUSA's website.
47 U.S.C. S: 503(b)(1)(B); 47 C.F.R. S: 1.80(a)(2).
47 U.S.C. S: 312(f)(1).
H.R. Rep. No. 97-765, 97th Cong. 2d Sess. 51 (1982).
See, e.g., Application for Review of Southern California Broadcasting
Co., Memorandum Opinion and Order, 6 FCC Rcd 4387, 4388 (1991)
("Southern California Broadcasting Co.").
See, e.g., Callais Cablevision, Inc., Grand Isle, Louisiana, Notice of
Apparent Liability for Monetary Forfeiture, 16 FCC Rcd 1359, 1362 P:
10 (2001) ("Callais Cablevision") (issuing a Notice of Apparent
Liability for, inter alia, a cable television operator's repeated
signal leakage).
Southern California Broadcasting Co., 6 FCC Rcd at 4388 P: 5; Callais
Cablevision, Inc., 16 FCC Rcd at 1362 P: 9.
47 U.S.C. S: 503(b); 47 C.F.R. S: 1.80(f).
See, e.g., SBC Communications, Inc., Forfeiture Order, 17 FCC Rcd
7589, 7591 P: 4 (2002) (forfeiture paid).
Attachment B lists the dates of the Enforcement Bureau inspections,
the analog-only models identified in violation of Section 15.117(k),
as well as the CompUSA stores involved.
Section 503(b)(5) states that no forfeiture liability shall be
determined against any person who does not hold a license, permit,
certificate, or other authorization issued by the Commission unless,
prior to issuance of any Notice of Apparent Liability, such person is
"(A) sent a citation of the violation charged; (B) is given a
reasonable opportunity for a personal interview with an official of
the Commission at the field office of the Commission which is nearest
to such person's place of residence; and (C) subsequently engages in
conduct of the type described in such citation." 47 U.S.C. S:
503(b)(5). The apparent violations discussed in this NAL are subject
to forfeiture because we have issued the Citations and afforded
CompUSA an opportunity for a personal interview or to submit a written
response to its first Citation before conducting a second round of
inspections that would count towards potential forfeiture liability.
See supra para. 5 and notes 13 and 14. To the extent that the
television receiving models involved in this NAL differ from those
listed in the Citations, no additional citations are necessary because
the more recent apparent violations are "conduct of the type
described" in the earlier Citations - violations of Section 15.117(k).
See HighTech CB Shop, Forfeiture Order, 20 FCC Rcd 12514, 12516 P: 9
(Enf. Bur. South Central Region 2005), recon. denied, 20 FCC Rcd 19269
(Enf. Bur. 2005).
47 U.S.C. S: 503(b)(2)(D). The Commission twice amended Section
1.80(b)(3) of the Rules, 47 C.F.R. S: 1.80(b)(3), to increase the
maximum forfeiture amounts, in accordance with the inflation
adjustment requirements contained in the Debt Collection Improvement
Act of 1996, 28 U.S.C. S: 2461. See Amendment of Section 1.80 of the
Commission's Rules and Adjustment of Forfeiture Maxima to Reflect
Inflation, Order, 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, Order, 19 FCC Rcd 10945 (2004) (adjusting
the maximum statutory amounts from $11,000/$87,500 to
$11,000/$97,500).
47 U.S.C. S: 503(b)(2)(E). See also 47 C.F.R. S: 1.80(b)(4), Note to
paragraph (b)(4): Section II. Adjustment Criteria for Section 503
Forfeitures.
See The Commission's Forfeiture Policy Statement and Amendment of
Section 1.80 of the Rules to Incorporate the Forfeiture Guidelines,
Report and Order, 12 FCC Rcd 17087, 17115 (1997), recon. denied, 15
FCC Rcd 303 (1999) ("Forfeiture Policy Statement").
Second DTV Periodic Report and Order at P: 12.
Id. at P: 12. See also 47 C.F.R. S:S: 11.1-11.61, 79.2.
See Pine Telephone Inc., Notice of Apparent Liability, 22 FCC Rcd
9205, 9210 P: 11 (Enf. Bur., Spectrum Enf. Div. 2007) (subsequent
history omitted); IT&E Overseas, Inc., Notice of Apparent Liability,
22 FCC Rcd 7660, 7665 P: 10 (Enf. Bur., Spectrum Enf. Div. 2007).
We caution CompUSA and other retailers that future cases involving
repeat offenders may result in the imposition of forfeitures on a
continuing violation basis.
"After the transition, absent a label requirement, even cable and
satellite subscribers might be surprised to find that they cannot
receive television broadcasts over-the-air on an analog-only
television purchased today if they choose to discontinue subscription
service or their cable or satellite service is terminated by disaster,
service disruption, or for non-payment of their bills." Second DTV
Periodic Report and Order, at P: 12.
See Attachment B regarding the calculation of the total proposed
forfeiture amounts.
47 U.S.C. S: 503(b), 47 C.F.R. S:S: 1.80, 15.117(k).
See 47 C.F.R. S: 1.1914.
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Federal Communications Commission FCC 08-103
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Federal Communications Commission FCC 08-103