On June 5, 2018, the Federal Communications Commission’s (“FCC’s” or the “Commission’s”) Enforcement Bureau (“Bureau”) issued a Notice of Apparent Liability against a manufacturer and retailer for marketing non-compliant RF devices, a dozen models of which were capable of operating in restricted spectrum bands. The FCC proposes to assess a total fine of $2,861,128.00 against ABC Fulfillment Services LLC and Indubitably, Inc. (collectively, “HobbyKing”) for equipment authorization rule violations involving 65 models of recreational audio/video transmitters (“AV Transmitters”) used with model airplanes drones. But more than $2.2 million of that resulted from the fact that twelve models apparently operates in restricted radio bands and three at higher powers than authorized in other bands. The restricted bands are those in which unlicensed transmitters are not allowed to operate because of potential interference to sensitive radio communications. In the case of HobbyKing’s the Commission found that its AV transmitters operated in bands where important government and public safety operations, such as those of the Federal Aviation Administration managing commercial and passenger flight traffic, doppler weather radar, flight testing, and other activities the FCC has determined are particularly worthy of heightened interference protection take place. In other words, the moral is that marketing devices that do not have proper equipment authorization is bad, but doing so when the devices operate within restricted bands is quite simply “egregious,” as the NAL put it.
This Time It’s Drones: FCC Reminds Retailers, Manufacturers, and Operators of Responsibilities Regarding Equipment Authorization
Simultaneously with issuing a nearly $3,000,000 fine to HobbyKing for marketing unauthorized (and in some cases not capable of being authorized) audio/video (“AV”) transmitters for use with drone mounted cameras, the Federal Communications Commission’s (“FCC’s” or “Commission’s”) Enforcement Bureau issued an Advisory Tuesday reminding retailer manufacturers, and operators of their obligations: no marketing or operation of unauthorized equipment except under very limited exceptions.
A Case of Bad Hygiene? FCC Proposes More Than $590,000 Penalty for RF Device Marketing Violations, and Commissioner O’Rielly Foreshadows Potentially Tougher Equipment Authorization Enforcement Policies
On May 30, 2018, the Commission issued a Notice of Apparent Liability (“NAL”) proposing a total penalty of $590,380 against a company for marketing noncompliant radio frequency (“RF”) devices in apparent violation of the agency’s equipment marketing rules. The allegations in the NAL provide a textbook example of how a company that becomes aware of a violation relating to products subject to the Commission equipment authorization procedures should not respond. The NAL was issued against Bear Down Brands, LLC, dba Pure Enrichment (“Pure Enrichment”), a Delaware company, in connection with fourteen models of the company’s consumer-oriented electronic personal hygiene and wellness devices it markets and imports, all of which were Part 15 or Part 18 unintentional radiators. The NAL alleges that the devices were noncompliant because they lacked proper equipment authorization, failed to make required user manual disclosures, and/or did not have compliant FCC labels.
FCC Turns to ATDS, Other TCPA Issues Following D.C. Circuit Decision
On May 14, 2018, the FCC issued a Public Notice seeking comment on a number of issues regarding the proper interpretation of the Telephone Consumer Protection Act (TCPA) in light of the recent decision by the D.C. Circuit Court of Appeals to overturn most of the FCC’s 2015 Omnibus TCPA Declaratory Ruling. Given Chairman Pai’s strong dissent from the 2015 Declaratory Ruling and his statement praising the D.C. Circuit’s findings regarding it, this comment cycle presents a valuable opportunity for parties who have been adversely affected by the uncertainty surrounding the TCPA in certain years to provide input to the FCC on how it should interpret the statute to best serve its intended purpose.
FCC Imposes Record-Setting $120 Million Fine for Spoofed Robocall Campaign
In the largest forfeiture ever imposed by the agency, the Federal Communications Commission (FCC) issued a $120 million fine against Adrian Abramovich and the companies he controlled for placing over 96 million “spoofed” robocalls as part of a campaign to sell third-party vacation packages. The case has received significant attention as an example of the growing issue of spoofed robocalls, with lawmakers recently grilling Mr. Abramovich about his operations. The item took the lead spot at the agency’s May meeting and is emblematic of the Pai FCC’s continued focus on illegal robocalls as a top enforcement priority. While questions remain regarding the FCC’s ability to collect the unprecedented fine, there is no question that the FCC and Congress intend to take a hard look at robocalling issues this year, with significant reforms already teed up for consideration.
Federal Communications Commission International Reporting Rule Changes Take Effect
Almost six months after releasing its October 2017 Order streamlining, eliminating, and revising certain international reporting requirements, on April 25, 2018, the Federal Communications Commission (“Commission”) published a public notice in the Federal Register announcing that the international reporting rule changes were effective on April 25, 2018. While, in practice, a Commission rule waiver had the effect of implementing one of the reporting changes, the Commission’s recent Federal Register notice publication establishes the official effective date of the reporting rule changes. Continue Reading
Press “1” for More Scrutiny: Congress Shows Keen Focus on Robocall Issues
Just over a month after the D.C. Circuit struck down large portions of the FCC’s 2015 Declaratory Ruling interpreting the Telephone Consumer Protection Act (TCPA), several developments on Capitol Hill last week suggest that Congress has renewed its focus on robocall issues. While these actions are preliminary, it could indicate that addressing robocalls may be priority for Congress ahead of the mid-term elections.
Tailor-Made: FCC Recognizes Need for Bespoke Rules for Smallsats
On April 17, 2018 the Federal Communications Commission adopted a notice of proposed rulemaking (“NPRM”) that seeks to streamline and otherwise tailor the agency’s current one-size-fits-all satellite regulations for small satellite systems (commonly referred to as “smallsats”). The NPRM sets forth proposals to expedite smallsat approvals and identifies certain frequency bands for potential use by smallsats.
If the proposals in the NPRM are eventually adopted, the FCC envisions that qualifying smallsat systems will be able to save significant time and money. In particular, qualifying smallsat systems would not have to go through the often time-consuming and paperwork-intensive processing rounds normally associated with the licensing or market entry approval of non-geostationary orbit (“NGSO”) satellite systems. Furthermore, qualifying smallsat systems would only have to pay the proposed satellite application fee of $30,000 (as opposed to the $454,705 satellite application fee under the standard Part 25 approval process). Last but not least, qualifying smallsat systems that deploy at least half of their satellites within one year and thirty days of FCC approval would be able to forego filing surety bonds with the Commission. That’s not a small alteration, as these bonds can cost anywhere from one to five million dollars per system. Continue Reading
Citing National Security, FCC Begins Proceeding to Bar the Use of Universal Service Monies for Equipment from Certain Countries
Echoing concerns raised by other parts of the federal government over the past several years, the FCC, at its open meeting on April 17, 2018, adopted a Notice of Proposed Rulemaking (“NPRM”) to consider a rule which would prohibit Universal Service Fund (“USF”) support from being used “to purchase or obtain any equipment or services produced or provided by a company posing a national security threat to the integrity of communications networks or the communications supply chain.” The NPRM seeks comment on issues such as how such a rule can be implemented and enforced, what types of equipment and services should be covered, and how manufacturers covered by the rule are to be identified and made known to USF recipients. Although this is only the start of the proceeding, the FCC’s action could have a broad-reaching impact for some communications equipment manufacturers and create potential liabilities for entities participating in any of the federal USF programs. All companies purchasing equipment from certain countries – principally China and Russia – may be affected, even if they don’t receive federal USF money.
FCC Commissioner O’Rielly Statement Hints at Possible Long-Awaited Movement on Team Telecom Review Process Reform
In 2016, the Federal Communications Commission (“FCC” or “Commission”) initiated a rulemaking proceeding proposing changes to the process of reviewing certain Section 214 and submarine cable landing license applications, conducted by the group of Executive Branch agencies commonly referred to as “Team Telecom.” That proceeding largely stalled after the comment cycle ended later that year. However, a Statement issued earlier this week by FCC Commissioner Michael O’Rielly endeavors to reignite movement on the long-pending issue of Team Telecom review process reform.
