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Before the
Federal Communications Commission
Washington, D.C. 20554
)
)
)
In the Matter of ) File No. EB-07-TC-4006
Horizon Telecom, Inc. ) NAL/Acct. No. 200832170013
Apparent Liability for Forfeiture ) FRN: 0009704925
)
)
)
NOTICE OF APPARENT LIABILITY FOR FORFEITURE
Adopted: February 29, 2008 Released: February 29, 2008
By the Commission:
I. INTRODUCTION
1. In this Notice of Apparent Liability for Forfeiture ("NAL"), we find
that Horizon Telecom, Inc. ("Horizon" or "Company") apparently
willfully or repeatedly violated sections 201(b) and 258 of the
Communications Act of 1934, as amended ("Communications Act" or
"Act"), and sections 1.717, 64.1120, and 64.1130 of the Commission's
rules. As discussed in more detail herein, Horizon has apparently
willfully or repeatedly failed to respond on a timely basis to
twenty-one (21) informal complaints served on it by the Consumer &
Governmental Affairs Bureau ("CGB"). In addition, it apparently
changed the preferred carriers of one hundred twenty-five (125)
consumers without proper authorization, a practice commonly known as
"slamming." Based upon our review of the facts and circumstances
surrounding these apparent violations, we propose a monetary
forfeiture of $5,084,000 against Horizon for the apparent violations
described herein.
2. Horizon's apparent violations are discussed individually in detail
below. However, we provide a brief background to the investigation.
Horizon is a Las Vegas-based company that provides long distance
calling services. The Commission has been monitoring Horizon's
activities due to the quantity and nature of informal complaints
received by CGB and state public utility commissions and Attorneys
General offices. The Enforcement Bureau ("EB") sent Horizon a Letter
of Inquiry ("LOI") on June 28, 2007, directing the company to answer a
number of inquiries regarding its business practices and compliance
with various Commission rules. Horizon provided a partial response on
July 27, 2007 ("response") and supplemented its response on September
19, 2007 ("supplemental response").
II. Discussion
A. Failure to Respond to Commission Directive
1. Background
3. CGB's informal complaint process provides an avenue for consumers to
have their complaints and inquiries addressed through informal
mediation and resolution by CGB with the carrier. CGB addresses
informal complaints against carriers by serving the complaint on the
carrier and requiring from the carrier within thirty days a written
response discussing the satisfaction of the complaint or the carrier's
refusal or inability to satisfy the complaint. Specifically, pursuant
to section 1.717:
The Commission will forward informal complaints to the appropriate carrier
for investigation. The carrier will, within such time as may be
prescribed, advise the Commission in writing, with a copy to the
complainant, of its satisfaction of the complaint or its refusal or
inability to do so. Where there are clear indications from the carrier's
report or from other communications with the parties that the complaint
has been satisfied the Commission may in its discretion, consider a
complaint proceeding to be closed, without response to the complainant. In
all other cases, the Commission will contact the complainant regarding its
review and disposition of the matters raised. If the complainant is not
satisfied by the carrier's response and the Commission's disposition, it
may file a formal complaint in accordance with S:1.721 of this part.
4. Pursuant to this process, CGB served on Horizon twenty-one (21)
informal complaints. Further, the Commission on March 2, 2007,
reminded carriers of the importance of responding to informal
complaints, and the seriousness of the penalties for failure to do so.
Horizon has failed to respond in a timely manner to these twenty-one
informal complaints. To date, Horizon has not responded to twelve of
the complaints,and responded at least two months late to the remaining
nine complaints.
1. Discussion
5. Sections 4(i), 4(j), 218, and 403 of the Act afford the Commission
broad authority to investigate the entities it regulates. Section 4(i)
authorizes the Commission to "issue such orders, not inconsistent with
this Act, as may be necessary in the execution of its functions," and
section 4(j) states that "the Commission may conduct its proceedings
in such manner as will best conduce to the proper dispatch of business
and to the ends of justice." Section 218 of the Act specifically
authorizes the Commission to "obtain from . . . carriers . . . full
and complete information necessary to enable the Commission to perform
the duties and carry out the objects for which it was created."
Section 403 of the Act grants the Commission "full authority and power
at any time to institute an inquiry, on its own motion . . . relating
to the enforcement of any of the provisions of this Act." Finally,
section 1.717 of our rules requires the Commission to forward informal
complaints to the appropriate carriers and requires a written response
from the carrier within thirty days.
6. We find that Horizon apparently violated section 1.717 of the
Commission's rules by failing to timely respond to the
above-referenced twenty-one informal complaints served by CGB. The
Commission on March 2, 2007, expressly reminded carriers of their
regulatory obligations to respond to informal complaints in a timely
fashion, and the seriousness of the penalties for failure to do so.
Nevertheless, Horizon has not timely responded to the informal
complaints referenced herein. Of the twenty-one complaints at issue,
Horizon failed to respond to twelve. Moreover, Horizon's responses to
the nine remaining complaints were filed not only beyond thirty days
of service, the time frame in which Horizon was given to respond in
all of these informal responses, but also beyond that March 2007
Public Notice. We conclude that Horizon apparently willfully or
repeatedly violated a Commission rule by failing to timely provide a
written response in response to twenty-one informal complaints.
Accordingly, a proposed forfeiture is warranted against Horizon for
this apparent willful or repeated violation.
A. Slamming Violations
1. Background
7. Section 258 of the Act prohibits the practice of "slamming," the
submission or execution of an unauthorized change in a subscriber's
selection of a provider of telephone exchange service or telephone
toll service ("preferred carrier"). Section 258 of the Act makes it
unlawful for any telecommunications carrier to "submit or execute a
change in a subscriber's selection of a provider of telephone exchange
service or telephone toll service except in accordance with such
procedures as the Commission shall prescribe." In December 1998, the
Commission released the Section 258 Order in which it adopted rules to
implement Section 258. In the Section 258 Order, the Commission
adopted aggressive rules designed to take the profit out of slamming,
broadened the scope of the slamming rules to encompass all carriers,
and modified its existing requirements for the authorization and
verification of preferred carrier changes.
8. The rules require, among other things, that a carrier receive
individual subscriber consent before a carrier change may occur.
Section 64.1120 of the Commission's rules prescribes that no carrier
"shall submit a change on the behalf of a subscriber . . . prior to
obtaining: (i) Authorization from the subscriber, and (ii)
Verification of that authorization in accordance with the procedures
prescribed in this section." Specifically, a carrier must: (1) obtain
the subscriber's written or electronically signed authorization in a
format that meets the requirements of section 64.1130; (2) obtain
confirmation from the subscriber via a toll-free number provided
exclusively for the purpose of confirming orders electronically; or
(3) utilize an independent third party to verify the subscriber's
order.
9. Of particular relevance here is section 64.1130 which details the
requirements for the letter of agency ("LOA") form and content for
written or electronically signed authorizations. Section 64.1130(b)
requires that the LOA "be a separate document (or an easily separable
document) or located on a separate screen or webpage containing only
the authorizing language described in paragraph (e) of [section
64.1130] having the sole purpose of authorizing a telecommunications
carrier to initiate a preferred carrier change. The letter of agency
must be signed and dated by the subscriber to the telephone line(s)
requesting the preferred carrier change." The rule further mandates
that the LOA "shall not be combined on the same document, screen, or
webpage with inducements of any kind." The rule details the basic
requirements for the LOA, including the size and readability of type,
and certain minimum content requirements.
a. Discussion
10. Each of the one hundred twenty-five (125) consumers who filed
complaints that form the basis of this NAL maintain that they did not
authorize Horizon to change their preferred carriers, but that Horizon
nevertheless changed their preferred carriers to Horizon. Horizon
states that authorization was received and confirmed when a letter of
agency was signed and processed. We find that Horizon has failed to
produce a preponderance of evidence that the complainants authorized a
carrier change. Therefore, we find that Horizon's actions apparently
resulted in an unauthorized change in each complainant's
telecommunications service provider.
11. In its response to the LOI, Horizon states that it markets through an
"Internet marketing campaign" and telemarketing, and that it
terminated both marketing programs prior to its receipt of the LOI.
The Company submitted copies of its Internet LOA, and its
telemarketing script and verification script. We have reviewed the LOA
submitted by Horizon, and find that Horizon's LOA contains an
inducement in apparent violation of our rules, despite Horizon's claim
that its LOA "ensures that customers are properly solicited...the
Letter of Authorization contains no marketing materials." In
particular, every LOA provided by Horizon contains not only acceptable
authorizing language and disclosures, but also the following
inducement: "[a]nd as an added BONUS, you will receive 2 FREE
Roundtrip Airline Tickets Certificate from Executive Tour and Travel!"
(emphasis in original). As noted above, our rules specifically
prohibit LOAs from being combined with any inducements on the same
"document, screen, or webpage." Further, the LOA appears to lack a
means or location for consumers to provide their electronic signature,
as required by our rules. Accordingly, any preferred carrier change
submitted by Horizon pursuant to the LOA it provided in response to
the LOI apparently violates our rules on its face and thus constitutes
a slam. We conclude that Horizon apparently willfully or repeatedly
violated a Commission rule by submitting carrier change orders without
proper authorization in accordance with our rules and section 258 of
the Act of every consumer listed in Appendix I. Accordingly, a
proposed forfeiture is warranted against Horizon for this apparent
willful or repeated violation.
III. FORFEITURE AMOUNT
12. 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 the section 503(b)
context. The Commission also may 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 willfully or repeatedly violated the Act or a
Commission order or rule.
13. Section 503(b)(2)(B) of the Act authorizes the Commission to assess a
forfeiture of up to $130,000 for each violation or each day of a
continuing violation, up to a statutory maximum of $1,325,000 for a
single act or failure to act. In determining the appropriate
forfeiture amount, we consider the factors enumerated in section
503(b)(2)(D) of the Act, including "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." As provided by the
Commission's rules, the Commission and its staff retain the discretion
to issue a higher or lower forfeiture, as permitted by statute.
14. Horizon will have an opportunity to submit further evidence and
arguments in response to this NAL to show that no forfeiture should be
imposed or that some lesser amount should be assessed.
A. Proposed Forfeiture for Horizon's Failures to Respond
15. Section 1.80 of the Commission's rules and the Commission's Forfeiture
Policy Statement establish a base forfeiture amount of and $4,000 for
failure to respond to a Commission communication. Horizon's failure to
timely respond to the twenty-one (21) informal complaints served by
CGB warrants the base forfeiture amount of $4,000 for each apparent
violation, for a proposed forfeiture of eighty-four thousand dollar
($84,000).
16. We also direct Horizon to respond to the remaining twelve informal
complaints within thirty (30) days of the release of this order.
Failure to do so may constitute an additional violation potentially
subjecting Horizon to further penalties, including potentially higher
monetary forfeitures, the revocation of operating authority, and the
disqualification of any Horizon principal from the provision of any
common carrier services without the prior consent of the Commission.
A. Proposed Forfeiture for Horizon's Slamming Violations
17. The Commission's forfeiture guidelines currently establish a standard
forfeiture amount of $40,000 for violations of our rules and orders
regarding unauthorized changes of preferred interexchange carriers. On
several occasions, the Commission has sternly warned carriers that it
would take swift and decisive enforcement action, including the
imposition of substantial monetary forfeitures, against any carrier
found to have engaged in slamming. We therefore find that Horizon is
apparently liable for a forfeiture of $40,000 for each of the one
hundred and twenty-five (125) unauthorized preferred carrier changes,
for a total forfeiture of five million dollars ($5,000,000).
IV. Conclusion and Ordering Clauses
18. We have determined that Horizon Telecom, Inc. has apparently willfully
or repeatedly violated sections 201(b) and 258 of the Communications
Act of 1934, as amended, and sections 1.717, 64.1120, and 64.1130 of
the Commission's rules. Horizon has apparently willfully and
repeatedly failed to timely respond to twenty-one (21) informal
complaints served on it by CGB and submitted changes of the preferred
carriers of one hundred twenty-five (125) consumers without their
proper authorization, for a total propose forfeiture of $5,084,000
dollars.
19. Accordingly, IT IS ORDERED, pursuant to section 503(b) of
Communications Act of 1934, as amended, 47 U.S.C. S: 503(b), section
1.80 of the Commission's rules, 47 C.F.R. S: 1.80, that Horizon
Telecom. Inc. IS HEREBY NOTIFIED of an Apparent Liability for
Forfeiture in the amount of $5,084,000 for willful or repeated
violations of sections 201(b) and 258 of the Act, 47 U.S.C. S:S: 201
and 258, and sections 1.717, 64.1120, and 64.1130 of the Commission's
rules and orders as described above.
20. 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, Horizon Telecom, Inc. SHALL PAY the full
amount of the proposed forfeiture or SHALL FILE a written statement
seeking reduction or cancellation of the proposed forfeiture. 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 -Telecommunications Consumers
Division, and must include the NAL/Acct. No. referenced in the
caption.
21. 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.
22. Payment of the forfeiture shall be made in the manner provided for in
section 1.80 of the Commission's rules within thirty (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. Payment of the
forfeiture must be made by credit card through the Commission's
Revenue and Receivables Operations Group at (202) 418-1995, or by
check or similar instrument, payable to the order of the Federal
Communications Commission. The payment must include the 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[s] by wire transfer may be made to ABA
Number 021030004, receiving bank Federal Reserve Bank of New York, and
account number 27000001. 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. Questions, please contact the Financial Operations
Group Help Desk at 1-877-480-3201 or Email: ARINQUIRIES@fcc.gov.
23. IT IS FURTHER ORDERED that copies of this Notice of Apparent Liability
for Forfeiture SHALL BE SENT by certified mail to Horizon Telecom,
Inc. at its address of record.
FEDERAL COMMUNICATIONS COMMISSION
Marlene H. Dortch
Secretary
Appendix I
1. IC# 07-S0277769 Matthew Scott 573-635-5808
2. IC# 07-S0277775 CJ Conte 304-598-7037
3. IC# 07-S0277887 Matthew Browning 660-882-9217
4. IC# 07-S0278231 Mary Weaver 816-525-4807
5. IC# 07-S0278566 Barbara Henning 215-799-0224
6. IC# 07-S0279040 James Major 610-670-1067
7. IC# 07-S001622 Manuel Sedan 724-465-2959
8. IC# 07-S001626 Claretha Young 314-524-7212
9. IC# 07-S001656 Rick Baldwin 816-792-8623
10. IC# 07-S001665 Tom Hand 816-525-6783
11. IC# 07-S001690 Courtney Szpara 262-375-0731
12. IC# 07-S001696 Todd Shaffer 816-795-7122
13. IC# 07-S001703 Kevin Tresenriter 816-415-8638
14. IC# 07-S001719 Michael Poindexter 816-537-7520
15. IC# 07-S001735 Kathleen Flanders 573-873-8071
16. IC# 07-S0277286 Nichola McCasland 573-431-8019
17. IC# 07-S0277702 Paula Geisler 610-326-2646
18. IC# 07-S0277729 David Hamilton 770-233-8364
19. IC# 07-S0277886 Brenda Morton 417-588-2689
20. IC# 07-S028232 Bruce Webster 816-228-9596
21. IC# 07-S0278564 Rick Gillenwater 660-442-3234
22. IC# 07-S0278569 Gary Moege 660-429-1618
23. IC# 07-S0278618 Debbie Ehling 816-792-2019
24. IC# 07-S0273144 Remi Freeman 215-321-2323
25. IC# 07-S0273206 Kim Ramirez 573-364-4624
26. IC# 07-S0273689 Kristin Rose 816-792-9775
27. IC# 07-S0274239 Shannon Hartman 804-639-1094
28. IC# 07-S0274323 Christine Potter 816-478-7465
29. IC# 07-S0274687 Brian Whitley 816-537-5308
30. IC# 07-S0274692 Eve Wells 816-781-5723
31. IC# 07-S0274693 Robert Snyder 816-407-9023
32. IC# 07-S0274695 Beth Hodge 717-417-1152
33. IC# 07-S0276099 Setsuko Meyers 636-329-8298
34. IC# 07-S0276105 Gary Boyd 816-373-3278
35. IC# 07-S0276110 Connie Savage 816-524-3483
36. IC# 07-S02762222 Pamela Fritzsche 314-428-5512
37. IC# 07-S0276777 Darlene Owens-Howard 404-696-2996
38. IC# 07-S0277042 Bryan Cessna 816-792-8473
39. IC# 07-S0277104 Thomas Mullen 757-479-5178
40. IC# 07-S0277106 Ron Schach 816-792-0860
41. IC# 07-S0277107 Ralph and Sonni Cooper 505-466-6661
42. IC# 07-S0277109 Charles Curtis 417-624-7451
43. IC# 07-S0277285 Michael Blechle 573-243-0767
44. IC# 07-S0277434 Heidi and Chris Hehner 314-427-0427
45. IC# 07-S0277528 Anthony Warner 816-229-9565
46. IC# 07-S0277534 Craig Nichols 573-659-8223
47. IC# 07-S0277665 Terry Roberts 814-336-3373
48. IC# 07-S0277669 Joshua Maddux 816-524-8754
49. IC# 07-S0277671 Gwendolyn and Jeffrey Finley 417-624-7776
50. IC# 07-S0277705 Thomas Stegeman 573-761-4886
51. IC# 07-S001517 Nancy Khashan 770-271-7399
52. IC# 07-S001530 John Monroe 724-783-7540
53. IC# 07-S001566 Timothy Potinga 412-833-5817
54. IC# 07-S001594 Edward Boles 816-246-4691
55. IC# 07-S001577 Jessica and Joshua Layman 417-859-0023
56. IC# 07-S001581 Duane Peter 816-792-1498
57. IC# 07-S001582 Rebecca Smith 816-833-3243
58. IC# 07-S001590 Jennifer Lay 816-224-8493
59. IC# 07-S001593 Colleen Baber 434-977-8930
60. IC# 07-S001571 Angeline Harkins 816-836-5351
61. IC# 07-S001596 John Granger 816-224-0079
62. IC# 07-S001607 Douglas Merrifield 417-889-6708
63. IC# 07-S001609 Ilona Bukhshtaber 314-863-3665
64. IC# 07-S001615 Teressa Hill 816-478-0468
65. IC# 07-S001617 William Jordan 314-647-6009
66. IC# 07-S001627 Diane Logsdon 816-537-5859
67. IC# 07-S001628 Mary Corley 573-635-9405
68. IC# 07-S001631 Megan and John Baldridge 660-886-9454
69. IC# 07-S001667 Robert Glauz 816-524-5596
70. IC# 07-S001675 Marilyn Kliethermes 573-636-5334
71. IC# 07-S001683 Gary Ford 816-781-4079
72. IC# 07-S001699 Brad Dye 816-229-1094
73. IC# 07-S001702 Albert Monteil 816-795-0120
74. IC# 07-S0261996 Andrea Kartchner 570-784-4737
75. IC# 07-S0262333 Lloyd Wrisley 804-378-2849
76. IC# 07-S0262341 Anne Widmer 314-846-9841
77. IC# 07-S0263454 Natasha Ewing 770-469-7294
78. IC# 07-S0265312 Jerome Blomberg 920-892-4941
79. IC# 07-S0278620 Gloria Lee 314-428-1999
80. IC# 07-S0279426 James Sumner 660-827-4598
81. IC# 07-S0279432 Chet Boisen 816-532-6284
82. IC# 07-S0279693 Alma Wright 770-860-9413
83. IC# 07-S0279695 Doug Schell 816-836-0019
84. IC# 07-S0279984 Carolyn Brewer 417-358-5316
85. IC# 07-S0280087 Lillie Monford 770-457-9041
86. IC# 07-S0280531 Jacqueline Whiston 816-734-8877
87. IC# 07-S0280647 Glenda Moon 770-429-1808
88. IC# 07-S0280650 Mary Struttmann 636-928-8467
89. IC# 07-B0275549 Jessee Biretz 717-540-0899
90. IC# 07-W13001949 Peter Nicastro 314-890-0672
91. IC# 07-W12994120 Edwin Borja 816-833-3722
92. IC# 07-W12982353 Stacey Price Brown 404-362-1211
93. IC# 07-W12937616 Nelson Bencomo 201-854-8283
94. IC# 07-W12896682 Saralyn Dicken 816-413-8251
95. IC# 07-I0270733 Dennis McMullen 775-626-0360
96. IC# 07-I0270252 John Conaty 804-214-9508
97. IC# 07-W12860834 Hanan Shaban 732-239-2006
98. IC# 07-I0266416 Barbara Post 610-384-1712
99. IC# 07-W12713387 Brian Emig 717-854-6325
100. IC# 07-F0265081 Beth Moury 412-672-4694
101. IC# 07-W12701686 Yolanda Ackerman 440-953-8531
102. IC# 07-W12654814 Christopher Nehoda 440-237-2203
103. IC# 07-F0261477 Gale Meidinger 717-732-3709
104. IC# 07-W12501443 Chris Charnas 407-862-2348
105. IC# 07-R335462 Patricia Blanco 305-828-8930
106. IC# 07-W13012330 Michael McMillan 573-243-0511
107. IC# 07-W12681465 Joshua Porter 614-899-2336
108. IC# 07-B0266043 Paula Daniels 321-632-9784
109. IC# 07-W12946489 Linda Finnessey 314-837-6839
110. IC# 07-W12904820 Tonia Budzina 440-988-5624
111. IC# 07-I0271243 Brenda Fisher 703-237-3610
112. IC# 07-I0266415 Heidi Tabor 609-884-3367
113. IC# 07-W12706455 Kathleen Marsh 269-683-3945
114. IC# 07-W12966032 Kevin Eckhoff 816-373-7012
115. IC# 07-W12700756 Ralph Landis 610-264-1307
116. IC# 07-W12691072 Margaret Calafut 570-282-6229
117. IC# 07-W12680651 Carlos Frias 732-389-3579
118. IC# 07-W13042260 Patricia Whitacre 417-532-4626
119. IC# 07-W12979181 Angela Klumb 920-662-1646
120. IC# 07-W12759157 Beverly Egan 410-252-6507
121. IC# 07-R296949 Charles Underdown 757-853-3982
122. IC# 07-W12659334 Max Ervin 413-736-3949
123. IC# 07-W12658145 Mickey Hutton 540-778-1186
124. IC# 07-W12729028 Gavril Costea 770-945-5576
125. IC# 07-W12692054 Yi-Tsuei Sheu 410-744-2346
47 U.S.C. S: 503(b)(1). The Commission has the authority under this
section of the Communications Act of 1934, as amended to assess a
forfeiture against any person who has "willfully or repeatedly failed to
comply with any of the provisions of this Act or of any rule, regulation,
or order issued by the Commission under this Act ...."
47 U.S.C. S:S: 201, 258.
47 C.F.R. S:S: 1.717, 64.1120, and 64.1130.
See para 7, infra.
Letter from Marcy Greene, Deputy Division Chief, Telecommunications
Consumers Division, Enforcement Bureau, Federal Communications Commission,
to Cheyenne Devine, Customer Service Manager, Horizon Telecom, Inc. (June
28, 2007) ("LOI").
Letter from Andrew Lustigman, The Lustigman Firm, P.C., Counsel to Horizon
Telecom, Inc., to Marcy Greene, Deputy Division Chief, Telecommunications
Consumers Division, Enforcement Bureau, Federal Communications Commission
(July 27, 2007) ("response").
Letter from Andrew Lustigman, The Lustigman Firm, P.C., Counsel to Horizon
Telecom, Inc., to Marcy Greene, Deputy Division Chief, Telecommunications
Consumers Division, Enforcement Bureau, Federal Communications Commission
(September 19, 2007) ("supplemental response")
47 C.F.R. S:1.717.
See IC#s 07-S0279092 (sent to Horizon 7/6/07, no response received),
07-S0279182 (sent to Horizon 7/26/07, no response received), 07-S0279425
(sent to Horizon 7/13/07, no response received), 07-S001633 (sent to
Horizon 6/14/07, no response received), 07-S0277776 (sent to Horizon
6/15/07, no response received), 07-S0278305 (sent to Horizon 6/19/07, no
response received), 07-S0279037 (sent to Horizon 7/10/07, no response
received), 07-S0279094 (sent to Horizon 7/10/07, no response received),
07-S001697 (sent to Horizon 7/13/07, no response received), 07-S0279981
(sent to Horizon 7/20/07, no response received), 07-S0266292 (sent to
Horizon 2/21/07, no response received), 07-S001551 (sent to Horizon
4/11/07, no response received), 07-S001530 (sent to Horizon 3/9/07,
response received 6/29/07), 07-S0267711 (sent to Horizon 3/6/07, response
received 6/29/07), 07-S0270717 (sent to Horizon 3/30/07, response received
6/29/07), 07-S0270921 (sent to Horizon 3/29/07, response received
6/29/07), 07-S001517 (sent to Horizon 2/2/07, response received 6/29/07),
07-S0263454 (sent to Horizon 2/2/07, response received 6/29/07),
07-S0257121 (sent to Horizon 2/8/07, response received 6/29/07),
07-S0262341 (sent to Horizon 1/26/07, response received 6/29/07),
07-S0266294 (sent to Horizon 2/21/07, response received 6/11/07).
Public Notice, Consumer & Governmental Affairs Bureau Reminds Common
Carriers of Their Obligation to Timely Respond to Informal Complaints, DA
07-989 (March 2, 2007).
See IC#s 07-S0279092 (sent to Horizon 7/6/07, no response received),
07-S0279182 (sent to Horizon 7/26/07, no response received), 07-S0279425
(sent to Horizon 7/13/07, no response received), 07-S001633 (sent to
Horizon 6/14/07, no response received), 07-S0277776 (sent to Horizon
6/15/07, no response received), 07-S0278305 (sent to Horizon 6/19/07, no
response received), 07-S0279037 (sent to Horizon 7/10/07, no response
received), 07-S0279094 (sent to Horizon 7/10/07, no response received),
07-S001697 (sent to Horizon 7/13/07, no response received), 07-S0279981
(sent to Horizon 7/20/07, no response received), 07-S0266292 (sent to
Horizon 2/21/07, no response received), 07-S001551 (sent to Horizon
4/11/07, no response received).
See IC#s 07-S001530 (sent to Horizon 3/9/07, response received 6/29/07),
07-S0267711 (sent to Horizon 3/6/07, response received 6/29/07),
07-S0270717 (sent to Horizon 3/30/07, response received 6/29/07),
07-S0270921 (sent to Horizon 3/29/07, response received 6/29/07),
07-S001517 (sent to Horizon 2/2/07, response received 6/29/07),
07-S0263454 (sent to Horizon 2/2/07, response received 6/29/07),
07-S0257121 (sent to Horizon 2/8/07, response received 6/29/07),
07-S0262341 (sent to Horizon 1/26/07, response received 6/29/07),
07-S0266294 (sent to Horizon 2/21/07, response received 6/11/07). We note
that, although CGB has served other complaints on Horizon that the Company
has not responded to in a timely fashion, we exercise our discretion not
to assess a forfeiture for those late-filed responses because we only
recently made clear our intent to enforce more strictly our response time
frame as set forth by section 1.717 of the Commission's rules, and because
those late-filed responses were not filed as far beyond the filing time
frame as those for which we do assess a forfeiture. We caution Horizon and
other carriers that, as we made clear in our March 2, 2007 Public Notice,
we expect timely responses to informal complaints, and we will take a hard
look at late-filed responses in subsequent actions.
47 U.S.C. S:S: 154(i), (j), 218, & 403.
47 U.S.C. S: 154(i), (j).
47 U.S.C. S: 218.
47 U.S.C. S: 403; see also 47 U.S.C. S: 154(i), (j).
47 C.F.R. S:1.717.
Consumer & Governmental Affairs Bureau Reminds Common Carriers of Their
Obligation to Timely Respond to Informal Complaints, Public Notice, DA
07-989 (March 2, 2007).
47 U.S.C. S: 258(a).
47 U.S.C. S: 258.
47 U.S.C. S: 258(a); Telecommunications Act of 1996, Pub. L. No. 104-104,
110 Stat. 56 (1996); Implementation of the Subscriber Carrier Selection
Changes Provisions of the Telecommunications Act of 1996; Policies and
Rules Concerning Unauthorized Changes of Consumers' Long Distance
Carriers, CC Docket No. 94-129, Second Report and Order and Further Notice
of Proposed Rule Making, 14 FCC Rcd 1508 (1998) (Section 258 Order),
stayed in part, MCI WorldCom v. FCC, No. 99-1125 (D.C. Cir. May 18, 1999);
First Order on Reconsideration, 15 FCC Rcd 8158 (2000); stay lifted, MCI
WorldCom v. FCC, No. 99-1125 (D.C. Cir. June 27, 2000); Third Report and
Order and Second Order on Reconsideration, 15 FCC Rcd 15996 (2000),
Errata, DA No. 00-2163 (rel. Sept. 25, 2000), Erratum, DA No. 00-2192
(rel. Oct. 4, 2000), Order, FCC 01-67 (rel. Feb. 22, 2001); Third Order on
Reconsideration and Second Further Notice of Proposed Rule Making, 18 FCC
Rcd 5099 (2003); Order, 18 FCC Rcd 10997 (2003). Prior to the adoption of
Section 258, the Commission had taken various steps to address the
slamming problem. See, e.g., Policies and Rules Concerning Unauthorized
Changes of Consumers' Long Distance Carriers, CC Docket No. 94-129, Report
and Order, 10 FCC Rcd 9560 (1995), stayed in part, 11 FCC Rcd 856 (1995);
Policies and Rules Concerning Changing Long Distance Carriers, CC Docket
No. 91-64, 7 FCC Rcd 1038 (1992), reconsideration denied, 8 FCC Rcd 3215
(1993); Investigation of Access and Divestiture Related Tariffs, CC Docket
No. 83-1145, Phase I, 101 F.C.C.2d 911, 101 F.C.C.2d 935, reconsideration
denied, 102 F.C.C.2d 503 (1985).
See 47 C.F.R. S: 64.1120.
Id. S: 64.1120(a)(1).
See 47 C.F.R. S: 64.1120(c). For those carriers that use an independent
third party for verification, our rules require that the verification
method confirm at least six things: the identity of the subscriber;
confirmation that the person on the call is authorized to make the carrier
change; confirmation that the person on the call wants to make the change;
the names of the carriers affected by the change; the telephone numbers to
be switched; and the types of service involved. Our rules also require
that carriers keep audio records of the verification for a minimum of two
years. 47 C.F.R. S: 64.1120. Finally, the Commission's rules require that
when a carrier "is selling more than one type of telecommunications
service ... that carrier must obtain separate authorization from the
subscriber for each service sold ... Each authorization must be verified
separately from any other authorizations obtained in the same
solicitation." 47 C.F.R. S: 21.1120(b).
47 C.F.R. S: 64.1130.
47 C.F.R. S: 64.1130(b).
47 C.F.R. S: 64.1130(c).
See 47 C.F.R. S:64.1130(e)(1) - (4).
See Appendix I.
See response at 3,7; supplemental response at 2.
See 47 C.F.R. S: 64.1150(d).
See response at 1- 2.
See 47 C.F.R. S: 64.1130(c).
See supplemental response at 2.
The LOA also includes the following language: "Horizon Telecom, Inc. is
not owned or affiliated with Executive Tour and Travel, who is solely
responsible for the fulfillment of the 2 free roundtrip airline
tickets...TRAVELER IS ENTITLED TO TWO COMPLIMENTARY ROUND TRIP AIRLINE
TICKETS, WHEN STAYING AT ONE OF THE PARTIPATING HOTELS OR CONDOS FOR A
MINIMUM NUMBER OF NIGHTS AND PAYING STANDARD RATES. TRAVELER IS
RESPONSIBLE FOR HOTEL AND AIR DEPARTURE TAXES. AIR, HOTEL, AND CONDO
RESERVATIONS MUST BE MADE THROUGH FLY FREE. FOR COMPLETE INFORMATION
PLEASE REFER TO THE VACATION GUIDE IN YOU [sic] TRAVEL PACKET OR VISIT
WWW.FLYFREEAMERICA.COM/IIG."
See 47 C.F.R. S: 64.1130(c).
47 C.F.R. S: 64.1130(b).
47 U.S.C. S: 503(b)(1)(B) and 47 C.F.R. S: 1.80(a)(1).
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, 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 (2002) ("SBC Forfeiture Order").
47 U.S.C. S: 503(b)(2)(B); see also 47 C.F.R. S: 1.80(b)(2); Amendment of
Section 1.80(b) of the Commission's Rules, Adjustment of Forfeiture Maxima
to Reflect Inflation, Order, 19 FCC Rcd 10945 (2004).
47 U.S.C. S: 503(b)(2)(D).
See 47 C.F.R. S: 1.80(b)(4).
47 U.S.C. S: 503(b)(b)(4)(C); 47 C.F.R. S: 1.80(f)(3).
47 C.F.R. S: 1.80; 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, 17114 (1997), recon. denied 15 FCC Rcd
303 (1999).
See CCN, Inc., et al, Order to Show Cause and Opportunity for Hearing,
Order, 13 FCC Rcd 13599 (1998) (revoking carrier's operating authority
based on findings of repeated violations); see also, e.g., Business
Options, Inc., Consent Decree, 19 FCC Rcd 2916 (2003); NOS Communications,
Inc., Affinity Network Incorporated and NOSVA Limited Partnership, Consent
Decree, 2003 WL 22439710 (2003).
See 47 C.F.R. S: 1.80(b)(4).
Brittan Communications International Corp., 15 FCC Rcd 4852 (2000);
Amer-I-Net Services Corp., 15 FCC Rcd 3118 (2000); All American Telephone
Company, Inc., 13 FCC Rcd 15040 (1998).
47 U.S.C. S:S: 201, 222.
47 C.F.R. S:S: 1.717, 64.1120, and 64.1130.
See 47 C.F.R.S:S: 64.1120; see also 1998 Second Report and Order, 14 FCC
Rcd at 1508; 1997 FNPRM & Order on Reconsideration, 12 FCC Rcd at 10,674.
47 U.S.C. S: 504(a).
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Federal Communications Commission FCC 08-70
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Federal Communications Commission FCC 08-70