As we enter the dog days of summer, the FCC continues to turn up the heat on equipment marketing enforcement. But while million dollar fines for marketing noncompliant devices capture the spotlight, the FCC also quietly issued a number of equipment marketing actions focused on a single type of device: LED signs. In just the last three months, the FCC has settled over ten investigations involving the marketing of LED signs used in digital billboards for commercial and industrial applications without the required authorizations, labeling, or user manual disclosures. Each action involved an entity that either manufactured or sold (or both) LED signs. The agency’s recent actions should be a shot across the bow to any retailer of LED signs to ensure that their devices are properly tested and authorized prior to sale. Otherwise, these companies may face significant fines and warehouses of unmarketable devices.
Most consumers might not think that LED signs fall within the FCC’s jurisdiction. However, the signs emit radio waves that can interfere with communications services. As a result, the FCC requires most LED signs and other “unintentional” radiators to be tested for compliance with its technical requirements prior to marketing. Importantly, the FCC’s rules prohibit the marketing of such devices unless they have been properly authorized, labeled, and carry the required disclosures. Even with the FCC’s recent efforts at simplification, the rules regarding equipment marketing are complex, requiring close attention to compliance at every step in the supply chain.
While all the settlements contain the standard FCC compliance and reporting obligations, a few key facts deserve further attention.
- First, the FCC initiated each of the investigations in response to a complaint. It is unclear whether all of the complaints came from the same source, but wireless carriers have shown no hesitation to alert the FCC of potential violations when they identify lighting systems as the source of interference on their spectrum.
- Second, it appears that the targeted companies did not conduct required testing until after the FCC started the investigations, potentially signaling a breakdown in compliance in the supply chain regarding who was responsible for ensuring the devices met FCC specifications.
- Third, all of the targeted companies brought their LED displays into compliance prior to reaching a settlement agreement with the FCC. The FCC usually sees such compliance as a necessary condition before settlement talks can begin.
- Fourth, each of the manufacturers or retailers were first-time violators. Unlike with entities that violate the TCPA rules, the FCC is not required to give warnings to entities that market devices that require an FCC equipment authorization. As a result, each of the entities in these investigations paid a fine, even though they appeared not to have prior knowledge of the regulations and appeared to respond in good faith to obtain the necessary authorizations after being contacted by the FCC. With LED signs, the FCC is not issuing free passes to first-time offenders.
There is no indication that the FCC plans to slow down on its equipment marketing investigations involving LED displays. Thus, every manufacturer, importer, or retailer of LED signs or other lighting devices that emit radiofrequency radiation should ensure their products are tested and conform to the FCC’s rules. Failure to heed these signs can be costly for a business.