Federal Communications Commission DA 24-371 Before the Federal Communications Commission Washington, D.C. 20554 In the Matter of ) ) AMG Technology Investment Group, LLC ) File No.: EB-IHD-19-00028994 ) NAL/Acct. No.: 201932080022 ) FRN: 0021701891 ) ) ) ) FORFEITURE ORDER Adopted: April 22, 2024 Released: April 22, 2024 By the Chief, Enforcement Bureau: I. INTRODUCTION 1. The Federal Communications Commission (Commission or FCC) has long standing rules that bar discussions between and among auction applicants during an auction and require auction applicants to self-report any such violations immediately upon their occurrence. On September 6, 2019, the Enforcement Bureau (Bureau) issued a Notice of Apparent Liability (NAL) for $100,000 against AMG Technology Investment Group, LLC (AMG or Company), for apparently violating section 1.21002(b)1 of the Commission’s rules by repeatedly engaging in prohibited communications with AT&T Services, Inc. (AT&T), the parent company of New Cingular Wireless PCS, LLC (Cingular),2 during the Connect America Fund (CAF) Phase II (CAF-II) auction (Auction 903), and the Bureau also concluded that AMG apparently violated section 1.21002(c)3 by failing to notify the Commission of such communications in a timely manner.4 AMG filed a Response to the NAL on October 7, 2019, which in pertinent part, requested that the Commission cancel the NAL or in the alternative substantially reduce the amount of the 1 47 CFR § 1.21002(b). 2 At the time the NAL was issued, the Commission’s rule stated that the term “applicant” shall include “any applicant, each party capable of controlling the applicant, and each party that may be controlled by the applicant or by a party capable of controlling the applicant.” 47 CFR § 1.21002(a) (2019). Because AT&T controls Cingular, AT&T is also considered an applicant in Auction 903 and therefore subject to all Auction 903 rules and procedures. In 2020, the Commission modified the definition of “applicant.” Establishing a 5G Fund for Rural America, GN Docket No. 20-32, Report and Order, 35 FCC Rcd 12174, 12259, para. 210 (2020) (Establishing a 5G Fund for Rural America). 3 47 CFR § 1.21002(c) (2019). In 2020, the rule for reporting prohibited communications was moved from section 1.21002(c) to section 1.21002(e) of the rules. See Establishing a 5G Fund for Rural America, 35 FCC Rcd at 12260, para. 211 (2020). See also Establishing a 5G Fund for Rural America, Final Rule, 85 Fed. Reg. 75770-01, 75816 (Nov. 25, 2020) (redesignating paragraphs (c) and (d) as paragraphs (e) and (f), respectively, under section 1.21002). Unless otherwise noted in this Forfeiture Order, citations to section 1.21002 are referring to the pre- amendment version as applied to AMG’s conduct during the relevant timeframe. 4 AMG Technology Investment Group, LLC, Notice of Apparent Liability for Forfeiture, 34 FCC Rcd 7649 (EB 2019) (NAL). Federal Communications Commission DA 24-371 proposed forfeiture.5 After reviewing the record in this matter, we reject AMG’s request to cancel or reduce the forfeiture penalty proposed in the NAL, and we impose the $100,000 forfeiture. II. BACKGROUND 2. Legal Framework. The CAF-II auction was implemented to award up to $198 million annually for 10 years to service providers that commit to offer voice and broadband services to fixed locations in unserved high-cost areas.6 It was the first FCC auction to award ongoing high-cost universal service support using a multiple-round, reverse auction format.7 For the CAF-II auction, section 1.21002(b) of the Commission’s rules provided that an applicant is prohibited: from cooperating or collaborating with any other applicant with respect to its own, or one another’s, or any other competing applicant’s bids or bidding strategies, and is prohibited from communicating with any other applicant in any manner the substance of its own, or one another’s, or any other competing applicant’s bids or bidding strategies, until after the post-auction deadline for winning bidders to submit applications for support.8 Auction 903’s quiet period commenced with the close of the FCC Form 183 (short-form) application filing window on March 30, 2018, at 6:00 p.m. EST, and concluded with the close of the FCC Form 683 (long-form) application filing window on October 15, 2018, at 6:00 p.m. EST (Quiet Period).9 An applicant’s duty to report potentially prohibited communications immediately or in any case within five business days was set out in section 1.21002(c) of the Commission’s rules.10 3. Factual Background. AMG and AT&T’s wholly owned subsidiary, Cingular, each submitted a short-form application to participate in Auction 903 and each entity qualified as a bidder.11 In the NAL, the Bureau found that during the course of Auction 903, AMG apparently violated section 1.21002(b) of the rules by communicating with AT&T regarding “prohibited information about its bids, bidding strategies and bidding outcome to AT&T . . . on at least seven separate occasions . . . during the 5 Response to Notice of Apparent Liability from AMG Technology Investment Group, LLC, to Chief, FCC Enforcement Bureau (Oct. 7, 2019) (on file in EB-IHD-19-00028994) (NAL Response). 6 See Connect America Fund et al., Report and Order and Further Notice of Proposed Rulemaking, 26 FCC Rcd 17663, 17692-94, 17695 (2011) (USF/ICC Transformation Order and/or FNPRM), aff’d sub nom. In re: FCC 11-161, 753 F.3d 1015 (10th Cir. 2014) (defining “voice telephony service” as the supported service and requiring Connect America Fund support recipients to offer broadband as a condition of receiving support). 7 In prior Mobility Fund and Tribal Mobility Fund auctions, the Commission awarded one-time universal service support using a single-round, reverse auction. USF/ICC Transformation Order, 26 FCC Rcd at 17773-824. The CAF-II auction’s bidding procedures were designed to enable a bidder to express in a simple and orderly way the amount of support it needed to provide a specified level of service to a specified set of eligible areas. Connect America Fund Phase II Auction Scheduled for July 24, 2018, Notice and Filing Requirements and Other Procedures for Auction 903, AU Docket No. 17-182, WC Docket No. 10-90, Public Notice, 33 FCC Rcd 1428, 1431 (2018) (Procedures Public Notice). 8 47 CFR § 1.21002(b). 9 See Procedures Public Notice, 33 FCC Rcd at 1432, 1477, 1490, paras. 10, 134, 185; Connect America Fund Phase II Auction (Auction 903) Closes, Winning Bidders Announced, FCC Form 683 Due October 15, 2018, AU Docket No. 17-182, WC Docket No. 10-90, Public Notice, 33 FCC Rcd 8257, 8267, para. 31 (Rural Broadband Auctions Task Force WTB/WCB 2018) (Auction 903 Closing Public Notice). 10 47 CFR § 1.21002(c) (2019). 11 220 Applicants Qualified to Bid in the Connect America Fund Phase II Auction (Auction 903), Bidding to Begin on July 24, 2018, AU Docket No. 17-182, WC Docket No. 10-90, Public Notice, 33 FCC Rcd 6171, 6184-95 (Rural Broadband Task Force/WTB/WCB 2018) (Attach. A: Qualified Bidders sorted by applicant name) (Qualified Bidders Public Notice). 2 Federal Communications Commission DA 24-371 Quiet Period.”12 The Bureau further found that AMG had failed to report these communications with AT&T to the Commission in a timely manner, in apparent willful violation of section 1.21002(c) of the Commission’s rules.13 The NAL proposed a forfeiture in the amount of $100,000 against AMG.14 4. On October 7, 2019, AMG filed its response to the NAL, requesting cancellation of the NAL or in the alternative, that the proposed forfeiture be substantially reduced.15 In support of its position, AMG characterized the communications with AT&T as “mere” and not “prohibited” communications16 and argued that: (1) the Bureau goes beyond its authority and construes any communication between applicants mentioning Auction 903 as a prohibited communication;17 (2) the Bureau substantially expands the scope of the terms “bids or bidding strategies;”18 (3) the Bureau “conflates” general business discussions between an applicant and an applicant’s affiliated entities with communications regarding the “post-auction market structure;”19 (4) the Bureau is not authorized to render a decision on an issue of first impression regarding the sharing of information by an auction applicant with non-officers of an affiliate of an auction applicant;20 (5) the relevant facts in this case do not support a forfeiture;21 and (6) any forfeiture assessed should be reduced based on AMG’s history of compliance with the Commission’s rules.22 AMG also claims it had no reason to believe that when the communications occurred there was anything to report as AMG and AT&T “were mutually unaware that Cingular was an applicant” in Auction 903.23 For the reasons discussed below, AMG’s arguments are unavailing. Notably, AMG does not deny that the communications at issue took place, or the dates when the communications were made. III. DISCUSSION 5. The Bureau proposed a forfeiture in this case in accordance with section 503(b)(2)(B) of the Communications Act of 1934, as amended (Act),24 section 1.80 of the Commission’s rules,25 and the Commission’s Forfeiture Policy Statement26 as well as previously assessed forfeitures for similar prohibited communications violations.27 When we assess forfeitures, section 503(b)(2)(E) of the Act 12 NAL, supra note 4, at 7653, para. 12. 13 Id. at 7654, para. 13. 14 Id. at 7649, para. 2. A separate Notice of Apparent Liability was simultaneously issued to AT&T. See AT&T Services, Inc., Notice of Apparent Liability for Forfeiture, 34 FCC Rcd 7660 (EB 2019) (AT&T NAL). 15 See generally NAL Response, supra note 5. 16 Id. at iii. 17 Id. at 5. 18 Id. at 9. 19 Id. at 10. 20 Id. at 12. 21 Id. at 14. 22 Id. at 19. 23 Id. at iv. 24 47 U.S.C. § 503(b)(2)(B). 25 47 CFR § 1.80. 26 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 (1997) (Forfeiture Policy Statement), recons. denied, Memorandum Opinion and Order, 15 FCC Rcd 303 (1999). 27 See Star Wireless, LLC and Northeast Communications of Wisconsin, Inc., Order on Review, 22 FCC Rcd 8943 (2007) (Star Wireless Order on Review), appeal denied, Star Wireless, LLC v. FCC & USA, 522 F.3d 469 (D.C. Cir. (continued….) 3 Federal Communications Commission DA 24-371 requires that we 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.”28 We have fully considered the arguments in AMG’s NAL Response and find them unpersuasive. We therefore impose the $100,000 forfeiture proposed in the NAL. 6. Liability. The record indicates that AMG, an Auction 903 applicant, engaged in several prohibited communications with AT&T, another Auction 903 applicant. AMG’s prohibited communications with AT&T on eight separate occasions during Auction 903’s Quiet Period was willful.29 As detailed in the NAL, the communications were prohibited because the subject matter and substance were about AMG’s bids, bidding strategies, and bidding outcomes; occurred on multiple occasions, in numerous e-mails, and even in person and by video conference; and all of these incidents occurred during Auction 903’s Quiet Period.30 Thus, AMG was an active participant in prohibited communications with AT&T surrounding AMG’s bids, bidding strategies, and bidding results, and then failed to report these communications to the Commission in violation of section 1.21002(b) and (c) of the Commission’s rules.31 7. AMG’s NAL Response attempts to turn the Commission’s rules and requirements for Auction 903 on their head to avoid application of the prohibited communications rule. In the Auction 903 Procedures Public Notice, the Commission was clear that “the terms contained in the Commission’s rules, relevant order, and public notices are not negotiable.” 32 The record demonstrates that AMG violated the Commission’s rules for Auction 903 regarding prohibited communications and as such, is liable for the entire forfeiture amount. A. The Bureau’s Determination that AMG’s Communications Are Prohibited Under the Commission’s Anti-Collusion Rules Was Well Within its Delegated Authority. 8. We have considered each of AMG’s arguments and find that each argument fails on substantive grounds. AMG claims that the Commission finds fault with what AMG characterizes as “mere communications, as opposed to prohibited communications” and does so without a “complete analysis under the Commission’s rules and prior statements of policy that underpin the rule.”33 Additionally, AMG asserts that the Commission’s rules expressly limit the scope of prohibited communications to those that involve “cooperating or collaborating with any other applicant with respect to its own, or one another’s, or any other competing applicant’s bids or bidding strategies,”34 and the Bureau’s approach substantially expands the scope of the terms “bids or bidding strategies.”35 Next, AMG accuses the Bureau of “conflating” general business discussions with communications regarding the post-auction market structure.36 Lastly, AMG argues that the Bureau is acting outside its delegated authority to decide this matter as this is a case of first impression regarding the import of information 2008) (Star Wireless); Cascade Access, LLC, Notice of Apparent Liability for Forfeiture, 24 FCC Rcd 1350, 1354, para. 14 (EB 2009), forfeiture issued, Forfeiture Order, 28 FCC Rcd 141 (EB 2013), recon. denied, Memorandum Opinion and Order, 30 FCC Rcd 14018 (EB 2015) (Cascade NAL). 28 47 U.S.C. § 503(b)(2)(E). 29 NAL, supra note 4, at 7652-53, paras. 8, 10; see 47 U.S.C. § 312(f)(1) (defining “willful”). 30 NAL, supra note 4, at 7652-53, paras. 8, 10. 31 Id. at 7653-54, para. 12-13. 32 Procedures Public Notice, supra note 7, at 1432, para. 6 (emphasis added). 33 NAL Response, supra note 5, at 5. 34 Id. (citing 47 CFR § 1.21002(b)). 35 Id. at 9. 36 Id. at 10. 4 Federal Communications Commission DA 24-371 11. AMG also claims that its communications with AT&T that the Company was “{[ ]} provide no substantive, actionable information that ‘has the potential to affect, bids and bidding strategies’” and that “nothing of substance regarding the bidding process is conveyed” by its communications.46 As the Commission stated in the past, however, “it is the substance and timing of specific communications that are key in determining whether there has been a violation [of the prohibited communications rule], not the impact or claimed lack thereof on a particular auction.”47 AMG’s statements were all delivered during the Quiet Period for Auction 903 and its statements each conveyed AMG’s bidding position or strategies in the auction. As such, the substance and timing of AMG’s communications violated the prohibited communications rules for Auction 903. That the Company does not believe it affected the results of Auction 903 is irrelevant because the prohibited communications rule does not require proof that the auction would have been altered but for the communications. Instead, the Company violated the prohibited communications rule by sharing communications during the Quiet Period with another auction applicant that were about Auction 903 and were precisely of the nature that the rule was intended to address. 12. In rendering its NAL, the Bureau followed the plain language of section 1.21002(b) of the Commission’s rules, the rule in place for Auction 903. AMG argues that “mere statements of AMG’s intention to bid or that it was actively bidding in the auction” made in the context of ongoing business discussions are not instances of prohibited communications.48 AMG is incorrect. The plain language of section 1.21002(b) of the Commission’s rules, and its statements in the Procedures Public Notice, are clear and unambiguous and covers “any communications conveying, in whole or part, directly or indirectly, the applicant’s or a competing applicant’s bids or bidding strategies.”49 Thus, whether it is “mere” statements during business discussions or direct communications among authorized bidders, if the communications convey an applicant’s bid or bidding strategies, such as whether an applicant is actively bidding, during an auction’s Quiet Period, the communication is prohibited. As such, AMG’s communications to AT&T, another applicant in Auction 903, during the Quiet Period, were prohibited. 2. The Bureau’s NAL Is Based on the Scope and Parameters for Prohibited Communications During Auction 903. 13. According to AMG, the “effect” of the Bureau’s NAL is to expand the scope of prohibited communications arbitrarily “well beyond ‘bids and bidding strategies’ to encompass ‘bidding results’ and ‘bidding outcomes.’”50 AMG questions “how post-auction statements about what has already occurred could have a retroactive adverse impact on the bids and bidding strategies that produced those results.”51 14. In adopting the procedures for Auction 903, the Commission was clear in its directive: “[t]he terms contained in the Commission’s rules, relevant orders, and public notices are not negotiable.”52 Also clear was the requirement to comply with section 1.21002(b) of the Commission’s 46 NAL Response, supra note 5, at 7. 47 Northeast Communications of Wisconsin, Inc., Forfeiture Order, 19 FCC Rcd 18635, 18639, para. 7 (EB 2004). 48 NAL Response, supra note 5, at 3. 49 Procedures Public Notice, supra note 7, at 1477-78, para. 135 (emphasis added). See also id. at 1478, para. 138 (“[C]ommunicating how a party will participate, including specific states and/or tier and latency combinations selected, specific percentages bid, and/or whether or not the party is placing bids, would convey bids or bidding strategies and would be prohibited.”). 50 NAL Response, supra note 5, at 9. 51 Id. AMG’s question overlooks the potential for prohibited communications between applicants in the period between the announcement of winning bidders and the long-form application deadline to facilitate anti-competitive behavior. 52 Procedures Public Notice, supra note 7, at 1432, para. 6. 6 Federal Communications Commission DA 24-371 communications.70 No new standards or rules regarding prohibited communications during auctions were created by the NAL. 20. The Bureau’s primary focus and jurisdiction in this matter relates to enforcement of the auction’s prohibited communications rule.71 Pursuant to section 0.201(a)(1) of the Commission’s rules, the Commission may delegate authority to act in non-hearing matters and proceedings to bureau chiefs and other members of Commission staff.72 The Enforcement Bureau serves as the primary Commission entity responsible for enforcement of the Act, the Commission’s rules, and Commission orders.73 Here, the Commission’s orders, public notices, and rules for Auction 903 provide the Chief of the Enforcement Bureau with sufficient existing guidelines to determine the appropriate action in response to this investigation and to enforce the Commission’s rules.74 21. AMG argues that this is a case of first impression because the NAL addresses the receipt of information regarding a competing applicant’s bids or bidding strategies by non-officers or directors of an applicant.75 However, the Company’s argument does not adequately address the relevant portion of the Procedures Public Notice which provides, in part: Applicants subject to section 1.21002 should take special care in circumstances where their officers, directors, and employees may receive information directly or indirectly relating to any other applicant’s bids or bidding strategies. Information received by a party related to the applicant may be deemed to have been received by the applicant under certain circumstances. For example, Commission staff have found that, where an individual serves as an officer and director for two or more applicants, the bids and bidding strategies of one applicant are presumed conveyed to the other applicant, and, absent a disclosed agreement that makes the rule’s exception applicable, the shared officer creates an apparent violation of the rule. Commission staff have not addressed a situation where non-officers or directors receive information regarding a competing 70 NAL, supra note 4, at 7654, 7654-55, paras. 13, 16 & n.53; see also Northeast Communications of Wisconsin, Inc., Forfeiture Order, 19 FCC Rcd 18635, 18641, para. 11 (EB 2004) (Northeast Communications of Wisconsin), order granted in part sub nom, Star Wireless Order on Review, supra note 27; Cascade Access, LLC, Forfeiture Order, 28 FCC Rcd 141, 144, para. 7 (EB 2013) (Cascade Forfeiture Order); Emmis Radio License Corp., Memorandum Opinion and Order, 17 FCC Rcd 18343 (EB 2002); US West Communications, Inc., Notice of Apparent Liability, 14 FCC Rcd 8816 (1999), Mercury PCS II, LLC, Notice of Apparent Liability, 12 FCC Rcd 17970 (1997). 71 See Star Wireless Order on Review, supra note 27, at 8952, para. 20. At the time, Star Wireless referred to the restriction as the “anti-collusion” rule, but as of 2010, the Commission has since referred to the rule as concerning prohibited communications. See Procedural Amends. to Comm'n Part 1 Competitive Bidding Rules, Order, 25 FCC Rcd 521, 1776, para. 3 (2010). This change had no substantive effect on the rule nor the Commission’s interpretation and application of the rule. 72 47 CFR § 0.201(a)(1). 73 Id. § 0.111. 74 See generally Procedures Public Notice, supra note 7; Qualified Bidders Public Notice, supra note 11; Auction 903 Closing Public Notice, supra note 9. 75 AMG argues that it “could not be expected to perceive that these [AT&T] individuals would have been engaged in any way with the Auction 903 activities of Cingular, of which they were neither employees nor decisionmakers, and therefore were not covered parties for purposes of the Commission’s Prohibited Communications Rule.” Response to Letter of Inquiry from Stephen E. Coran, Esq., Counsel to AMG Technology Investment Group, LLC, Lerman Senter PLLC, to Marlene H. Dortch, Secretary, and Genevieve Ross, Attorney Advisor, Investigations and Hearings Division, FCC Enforcement Bureau at 3 (May 8, 2019) (on file in EB-IHD-19-00028994) (AMG LOI Response). The facts of this case prove this perception to be misconceived. 9 Federal Communications Commission DA 24-371 applicant’s bid or bidding strategies and whether that information should be presumed to be communicated to the applicant.76 22. In this case, the question of whether the communication is presumed to be made to an officer or director of a competing applicant never surfaces because the communication was certainly received by an officer of a competing applicant. Here, the communications to Mr. Degele were transmitted to a Senior Counsel and Assistant Vice President of AT&T.77 The Bureau did not need to make any presumptions regarding the receipt of the prohibited communications by an officer or director of AT&T, because there is no dispute that the relevant communications were in fact received by an officer of AT&T. This is demonstrated by the fact that the Senior Counsel and Assistant Vice President of AT&T disclosed the prohibited communications to the Commission, thereby alerting the Commission to the prohibited communications in the first instance.78 For purposes of the prohibited communications rule, the fact that such communications were received by an officer or director of an applicant is sufficient to implicate the rule. AT&T’s disclosure, coupled with the record the Bureau developed by its investigation,79 demonstrates that AMG engaged in prohibited communications with another Auction 903 applicant, and the information in those communications was in fact delivered to the competing applicant. Thus, there was nothing for the Bureau to presume.80 Moreover, whether the recipient of the communications was an officer or director of an applicant was not an outcome determinative factor. Rather, the fact that the communication actually reached an officer of a competing applicant during the Quiet Period, answered the question of whether the information was communicated to an officer of the competing applicant. Indeed, the NAL made clear that the Bureau relied on the disclosure and record evidence in developing the Bureau’s conclusions.81 23. Additionally, while applicants for Auction 903 were directly cautioned to take special care in circumstances where officers, directors and employees “may receive information directly or indirectly relating to any other applicant’s bids or bidding strategies,” it is the conveyance of the 76 NAL Response, supra note 5, at 12 (quoting Procedures Public Notice, supra note 7, 33 FCC Rcd at 1477, para. 133) (emphasis added). 77 The NAL delineated the various prohibited communications that occurred. See NAL, supra note 4, at 7652, para. 8. These communications show that AT&T employees, Mr. Jason Degele, Regional Director of AT&T Business, and Mr. Bill Eifert, AT&T Regional Vice President of AT&T Business, were involved in discussions concerning AMG’s bids and bidding strategies and these communications reached Paul Theiss, an AT&T Assistant Vice President and Senior Legal Counsel, who terminated discussions with AMG. See Letter from Stephen E. Coran, Esq., Counsel to AMG Technology Investment Group, LLC, Lerman Senter PLLC, to Marlene H. Dortch, Secretary, and Genevieve Ross, Attorney Advisor, Investigations and Hearings Division, FCC Enforcement Bureau (May 8, 2019) (on file in EB-IHD-19-00028994), Attachment 1 – Email Correspondence. Subsequently, Cathy Carpino, AT&T Assistant Vice President and Senior Legal Counsel, reported the communications to the Commission. 78 Specifically, on September 11, 2018, in response to the September 7, 2018 communication by AMG, an attorney for AT&T informed AMG’s outside counsel that AT&T would not further discuss Auction 903-related opportunities until after the Quiet Period ended. AT&T NAL, supra note 14, at 7663, para. 8. On September 20, 2018, AT&T, through its Senior Counsel and Assistant Vice President, notified the Commission’s Wireless Telecommunications Bureau’s Auctions and Spectrum Access Division staff of the potential prohibited communications with AMG. Id. at 7664, para. 9. See Letter from Cathy Carpino, Senior Counsel, AT&T Services, Inc., to Margaret Weiner, Chief, Auctions and Spectrum Access Division, Wireless Telecommunications Bureau (Sept. 20, 2018) (AT&T Disclosure Letter) (on file in EB-IHD-00028991). 79 NAL, supra note 4, at 7652-53, para. 8. 80 Furthermore, the paragraph AMG cites to prop up its first impression argument notes that applicants should be aware of direct and indirect receipt of information relating to another applicant’s bid or bidding strategies. See NAL Response at 12 (citing Procedures Public Notice, supra note 7, at 1477, para. 133). 81 NAL, supra note 4, at 7653-54, 7656, paras. 12, 18; see also AMG LOI Response, supra note 75, at 9, 11-15. 10 Federal Communications Commission DA 24-371 communication that is prohibited.82 The Commission’s rules provide that an applicant for a Commission auction may not convey certain information to other auction applicants during the “quiet period” which commences on the deadline for filing a short-form application and terminates on the deadline for winning bidders to submit their long form applications.83 Thus, AMG’s argument has no foundation given the facts of this case and Commission’s existing caselaw84 regarding prohibited communications. B. The Facts of this Investigation Support AMG’s Assessed Forfeiture. 24. AMG asserts that “there is simply no factual basis upon which the Bureau could have concluded, as a legal matter, that the broad statements made by AMG’s CEO had any impact on the conduct of Auction 903.”85 AMG provides that “all the facts pertaining to the case . . . yields the definitive conclusion that there was no prohibited communication because there was no nexus between the communications and the conduct of Auction 903.”86 AMG’s arguments fail to refute the main legal issue: that AMG violated section 1.21002(b) of the Commission’s rules during Auction 903 by sending several e-mails to AT&T discussing AMG’s Auction 903 bids, bidding strategies and bidding results, all during Auction 903’s Quiet Period and section 1.21002(c) of the Commission’s rules by failing to report the prohibited communications. 25. AMG does not deny that the communications took place. Neither could the Company do so because there is dated and documented evidence of this fact.87 The standard for prohibited communications as outlined in section 1.21002(b) is not solely whether the applicant “possessed sufficient information to permit any prohibited collaboration to occur.”88 It is whether an applicant communicated with “any other applicant in any manner the substance of its own . . . bids or bidding strategies.”89 We reject AMG’s claim that it conveyed no substantive information to AT&T.90 In the context of the rule, the term “substance” does not refer to the quality of the information delivered, rather it refers to the nature of what was conveyed and whether that nature discussed the applicant’ bids or bidding strategies.91 The quality of the information conveyed to AT&T is not relevant, it is the actual wording and nature of what was communicated that is significant. The nature of the information provided by AMG indeed referred to its actual bids and bidding strategies in violation of our rule against prohibited communications. 82 Procedures Public Notice, supra note 7, at 1477, para. 133. 83 See Nikola Engineering, Inc., Consent Decree, 36 FCC Rcd 12155, para. 3 (EB 2021) (Nikola Engineering). 84 See generally supra note 27. 85 NAL Response, supra note 5, at 14. 86 Id. at 14. 87 See NAL, supra note 4, at 7652-53, para. 8. 88 NAL Response, supra note 5, at 14-15. 89 47 CFR § 1.21002(b). 90 NAL Response, supra note 5, at 15. 91 See Application of Star Wireless, LLC, Forfeiture Order, 19 FCC Rcd 18626, 18630, para. 8 (2004) (Star Wireless Forfeiture Order) (“[I]t is the substance and timing of specific communications that are key in determining whether there has been a violation of section 1.2105(c), not the impact or claimed lack thereof on a particular auction.”). See also Star Wireless, supra note 27, at 475 (“[A]s the Commission observes, general bright-line prophylactic measures, such as the anti-collusion rule, are appropriate when ‘the probability of abuse in transactions between related organizations is significant enough that it is more efficient to prevent the opportunity for abuse from arising than it is to try to detect actual incidents of abuse.”) (citing Biloxi Reg’l Med. Ctr. v. Bowen, 835 F.2d 345, 350 (D.C. Cir. 1987); accord Weinberger v. Salfi, 422 U.S. 749 (1975)). 11 Federal Communications Commission DA 24-371 26. AMG continues to rely on unavailing arguments and asserts that all of the Company’s communications occurred after AT&T decided not to bid.92 Despite its decision not to bid in the CAF-II auction, AT&T was still considered an applicant for Auction 903 and as such, any communications with AT&T were subject to section 1.21002(b) of the Commission’s rules.93 27. Lastly, AMG argues that the parties reported the prohibited communications upon becoming aware of the fact that both AMG and AT&T’s affiliate had submitted Auction 903 applications.94 Even if AMG could not discern the rather obvious link between the Cingular bidding entity and AT&T, this is not a defense, rather a demonstration of the Company’s lack of diligence. Moreover, such reporting occurred outside of the five-day reporting window. The reporting requirement of section 1.21002(c) of the Commission’s rules is unambiguous when it states that “[a]n applicant that makes or receives communications that may be prohibited . . . shall report such communications to the Commission staff immediately. . . .”95 Thus, AMG violated the Commission’s rules first by communicating with another auction applicant as to AMG’s bids and bidding strategies during the Auction 903 Quiet Period, and then again when it failed to report its actions by the required deadline. Accordingly, the Commission’s finding of a violation of section 1.21002(c) of the Commission’s rules for failure to report the prohibited communications is justified. C. AMG’s Forfeiture Is Consistent with Commission Precedent. 28. We reject AMG’s assertion that issuing a forfeiture in this case would be “inconsistent with all prior Commission precedent enforcing the anti-collusion rules.”96 AMG argues that auction participants were not aware of the Bureau’s expansive interpretation of “bids and bidding strategies” and any prior sanctions have related “solely to the sharing of substantive, actionable information regarding bids, typically with respect to specific markets.”97 29. To support its position, AMG notes that in Mercury PCS, the Commission rescinded its finding of forfeiture liability because Mercury did not receive “adequate notice that the activities in which it engaged would violate the anti-collusion rule.”98 In Mercury PCS, the allegations surrounded Mercury’s use of bid signaling—a non-verbal activity that the Commission had not previously addressed in its prohibited communication’s rules but was subsequently determined by the Commission to undermine the integrity of the auction process and was therefore prohibited under the anti-collusion rule.99 AMG asserts that the Commission cannot impose a harsher penalty in this instance where there is no evidence of an “intent to influence the auction or any actual impact on the bidding process . . . .”100 30. However, comparisons between AMG’s communications and Mercury PCS are not apt. First, unlike the non-verbal activity at issue in Mercury PCS, the allegations here involve verbal and 92 NAL Response, supra note 5, at 16. 93 Qualified Bidders Public Notice, supra note 11, at 6178, para. 40. See also Star Wireless Forfeiture Order, 19 FCC Rcd at 18628, para. 4 & n.19 (observing that the Commission has repeatedly made clear that the prohibited communications rule applies to applicants regardless of whether they are qualified to bid). 94 NAL Response, supra note 5, at 17. 95 47 CFR § 1.21002(c) (2019). 96 NAL Response, supra note 5, at 17 (emphasis added). 97 NAL Response, supra note 5, at 17 (citing Star Wireless, supra note 27, at 472; Mercury PCS II, LLC, Memorandum Opinion and Order, 13 FCC Rcd 23755, 23760, para. 11 (1998) (Mercury PCS); US WEST Communications, Inc., Notice of Apparent Liability for Forfeiture, 13 FCC Rcd 8286, 8290-91, para. 11, and 8297, para. 30 (1998)). 98 NAL Response, supra note 5, at 18 (citing Mercury PCS, 13 FCC Rcd at 23759-60, para. 10). 99 Mercury PCS, 13 FCC Rcd at 23760, para. 11. 100 NAL Response, supra note 5, at 18. 12 Federal Communications Commission DA 24-371 33. As both these cases reflect, the Bureau’s NAL is in line with previous cases regarding prohibited communications. While the auction format may differ from auction to auction, the prohibited communications rule must be rigorously enforced to maintain the integrity of the Commission’s auctions. D. Reduction of AMG’s Forfeiture Amount Is Not Warranted. 34. In the NAL, the Bureau found that “this case does not merit a reduction from the $100,000 forfeiture amount.”110 AMG argues that a reduction in the amount of the forfeiture is “manifestly warranted” based on Commission precedent where forfeiture amounts have been reduced when a party has a history of compliance with Commission rules.111 While citing to other prohibited communications decisions, AMG does not provide enough evidence to demonstrate why a forfeiture reduction is warranted in this instance.112 Although AMG provides that it has never been cited for a violation of the Commission’s rules,113 the fact remains that in the instant case, AMG violated our prohibited communications rules on eight distinct occasions and also failed to report that violation in a timely manner as further required by our rules. This was not an instance of one prohibited communication as was the case in Cascade, it is the culmination of several prohibited communications.114 As such, no reduction in the forfeiture amount is warranted. 35. The Commission’s Forfeiture Policy Statement specifies that the Commission shall impose a forfeiture based upon consideration of the factors enumerated in section 503(b)(2)(E) of the Act, 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.”115 We have carefully considered each of these factors, including AMG’s history of compliance with the Commission’s rules, and find no basis for mitigating the proposed forfeiture amount. AMG’s misconduct was willful, serious, and repeated. Given the numerous reminders about prohibited communications issued to applicants in Auction 903, AMG knew or should have known that the communication in which it engaged was prohibited. It also knew or should have known to report such prohibited communications to the Commission in a timely manner. 36. Forfeiture Amount. AMG engaged in several prohibited communications with another applicant, during the Quiet Period for Auction 903 and failed to report the prohibited communications to the Commission within 5 business days. As both these actions were willful, we impose the $100,000 forfeiture amount proposed in the NAL.116 110 NAL Response, supra note 5, at 20 (citing NAL, supra note 4, at 7652, para. 8). 111 NAL Response, supra note 5, at 21, 22. 112 AMG leans heavily on the Bureau’s decision in Cascade Wireless where the Bureau’s initial forfeiture amount was $75,000. AMG argues that that Cascade’s forfeiture reduction was “presumably, although not explicitly, factored into the original forfeiture amount in the NAL.” This is pure conjecture by AMG and provides no support to its premises for a reduction in its assessed forfeiture amount. See NAL Response, supra note 5, at 20, n.73. 113 NAL Response, supra note 5, at 21. 114 See Cascade NAL, 24 FCC Rcd at 1354, para. 14; see NAL, supra note 4, at 7655, para. 16, n.53. 115 47 U.S.C. § 503(b)(2)(E); 47 CFR § 1.80(b)(11); see also 47 CFR § 1.80(b)(2) (setting the current inflation adjusted statutory maximum for a violation of 47 U.S.C. § 503(b)(2)(B) at $244,958 for each violation or each day of a continuing violation, up to $2,449,575 for a violation); Amendment of Section 1.80(b) of the Commission’s Rules, Adjustment of Civil Monetary Penalties to Reflect Inflation, Order, DA 23-1198, WL 8889597 (EB Dec. 22, 2023); Annual Adjustment of Civil Monetary Penalties to Reflect Inflation, 89 Fed. Reg. 2148 (Jan. 12, 2024) (setting Jan. 15, 2024 as the effective date for the increases). 116 NAL, supra note 4, at 7649, para. 2. 14 Federal Communications Commission DA 24-371 IV. CONCLUSION 37. Based on the record before us we conclude that AMG willfully violated section 1.21002(b) and (c)117 of the Commission’s rules and pursuant to section 503(b)(2)(E) of the Act and section 1.80 of the Commission’s rules is liable for a $100,000 forfeiture of these violations. V. ORDERING CLAUSES 38. Accordingly, IT IS ORDERED that, pursuant to section 503(b) of the Act, 47 U.S.C. § 503(b), and section 1.80 of the Commission’s rules, 47 CFR § 1.80, AMG Technology Investment Group, LLC, IS LIABLE FOR A MONETARY FORFEITURE in the amount of one-hundred thousand dollars ($100,000) for willfully violating section 1.21002(b) and (c) of the Commission’s rules.118 39. Payment of the forfeiture shall be made in the manner provided for in section 1.80 of the Commission’s rules within thirty (30) calendar days after the release of this Forfeiture Order.119 AMG Technology Investment Group, LLC shall send electronic notification of payment to Patrick McGrath, Kalun Lee, Georgina Feigen, and Tram Pham, Enforcement Bureau, Federal Communications Commission, at Patrick.McGrath@fcc.gov, Kalun.Lee@fcc.gov, Georgina.Feigen@fcc.gov , and Tram.Pham@fcc.gov on the date said payment is made. If the forfeiture is not paid within the period specified, the case may be referred to the U.S. Department of Justice for enforcement of the forfeiture pursuant to section 504(a) of the Act.120 40. In order for AMG Technology Investment Group, LLC to pay the proposed forfeiture, AMG Technology Investment Group, LLC shall notify Patrick McGrath at Patrick.McGrath@fcc.gov, Kalun Lee at Kalun.Lee@fcc.gov, Georgina Feigen at Georgina.Feigen@fcc.gov, and Tram Pham at Tram.Pham@fcc.gov of its intent to pay, whereupon an invoice will be posted in the Commission’s Registration System (CORES) at https://apps.fcc.gov/cores/userLogin.do. Payment of the forfeiture must be made by credit card using CORES at https://apps.fcc.gov/cores/userLogin.doH, AC (Automated Clearing House) debit from a bank account, or by wire transfer from a bank account. The Commission no longer accepts forfeiture payments by check or money order. Below are instructions that payors should follow based on the form of payment selected: 121 • Payment by wire transfer must be made to ABA Number 021030004, receiving bank TREAS/NYC, and Account Number 27000001. In the OBI field, enter the FRN(s) captioned above and the letters “FORF”. In addition, a completed Form 159122 or printed CORES form123 must be faxed to the Federal Communications Commission at 202-418-2843 or e-mailed to RROGWireFaxes@fcc.gov on the same business day the wire transfer is initiated. Failure to provide all required information in Form 159 or CORES may result in payment not being recognized as having been received. When completing FCC Form 159 or CORES, enter the Account Number in block number 23A (call sign/other ID), enter the letters “FORF” in block number 24A (payment type code), and enter in block number 11 the FRN(s) captioned above 117 47 CFR § 1.21002(c) (2020). 118 47 U.S.C. § 503(b); 47 CFR § 1.80. 119 47 CFR § 1.80. 120 47 U.S.C. § 504(a). 121 For questions regarding payment procedures, please contact the Financial Operations Group Help Desk by phone at 1-877-480-3201 (option #1). 122 FCC Form 159 is accessible at https://www.fcc.gov/licensing-databases/fees/fcc-remittance-advice-form-159. 123 Information completed using the Commission’s Registration System (CORES) does not require the submission of an FCC Form 159. CORES is accessible at https://apps.fcc.gov/cores/userLogin.do. 15 Federal Communications Commission DA 24-371 (Payor FRN). 124 For additional detail and wire transfer instructions, go to https://www.fcc.gov/licensingdatabases/fees/wire-transfer . • Payment by credit card must be made by using CORES at https://apps.fcc.gov/cores/userLogin.do. To pay by credit card, log-in using the FCC Username associated to the FRN captioned above. If payment must be split across FRNs, complete this process for each FRN. Next, select “Manage Existing FRNs | FRN Financial | Bills & Fees” from the CORES Menu, then select FRN Financial and the view/make payments option next to the FRN. Select the “Open Bills” tab and find the bill number associated with the NAL Acct. No. The bill number is the NAL Acct. No. with the first two digits excluded (e.g., NAL 1912345678 would be associated with FCC Bill Number 12345678). After selecting the bill for payment, choose the “Pay by Credit Card” option. Please note that there is a $24,999.99 limit on credit card transactions. • Payment by ACH must be made by using CORES at https://apps.fcc.gov/cores/userLogin.do. To pay by ACH, log in using the FCC Username associated to the FRN captioned above. If payment must be split across FRNs, complete this process for each FRN. Next, select “Manage Existing FRNs | FRN Financial | Bills & Fees” on the CORES Menu, then select FRN Financial and the view/make payments option next to the FRN. Select the “Open Bills” tab and find the bill number associated with the NAL Acct. No. The bill number is the NAL Acct. No. with the first two digits excluded (e.g., NAL 1912345678 would be associated with FCC Bill Number 12345678). Finally, choose the “Pay from Bank Account” option. Please contact the appropriate financial institution to confirm the correct Routing Number and the correct account number from which payment will be made and verify with that financial institution that the designated account has authorization to accept ACH transactions. 41. Any request for making full payment over time under an installment plan should be sent to: Chief Financial Officer – Financial Operations, Federal Communications Commission, 45 L Street NE, Washington, D.C. 20554. Questions regarding payment procedures should be directed to the Financial Operations Group Help Desk by telephone, 1-877-480-3201, or by e-mail, ARINQUIRIES@fcc.gov. 42. IT IS FURTHER ORDERED that a copy of this Forfeiture Order shall be sent by first class mail and certified mail, return receipt requested, to Stephen E. Coran, Esq., counsel for AMG Technology Investment Group, LLC, Lerman Senter PLLC, 2001 L Street, NW, Suite 400, Washington, D.C. 20036. FEDERAL COMMUNICATIONS COMMISSION Loyaan A. Egal Chief Enforcement Bureau 124 Instructions for completing the form may be obtained at http://www.fcc.gov/Forms/Form159/159.pdf. 16