*Pages 1--7 from Microsoft Word - 2005.doc* Federal Communications Commission FCC 00- 219 Before the FEDERAL COMMUNICATIONS COMMISSION Washington, D. C. 20554 In the Matter of ) ) Tri- Star Marketing, Inc. ) File No. EB- 00- TC- 009 ) Apparent Liability for Forfeiture ) NAL/ Acct. No. X3217- 005 NOTICE OF APPARENT LIABILITY FOR FORFEITURE Adopted: June 15, 2000 Released: June 22, 2000 By the Commission: I. INTRODUCTION 1. In this Notice of Apparent Liability for Forfeiture (NAL), we find that Tri- Star Marketing, Inc. (Tri- Star) 1 apparently willfully or repeatedly violated section 227 of the Communications Act of 1934, as amended (Act), and the Commission’s rules and orders, by sending unsolicited advertisements to telephone facsimile machines on eight separate occasions. 2 Based on the facts and circumstances surrounding these apparent violations, we find that Tri- Star is apparently liable for forfeiture in the amount of $47,000. 3 1 Tri- Star Marketing, Inc. is headquartered at 2906 & 2910 Hoyt Avenue, Everett WA. According to Dun & Bradstreet Business Information Report, Tri- Star, a Management Consulting Services Corporation, began operations in 1996 and operates a direct mail marketing company. Tri- Star Marketing is a closely held corporation whose president, Mr. Dary Riedlinger, owns 91% of the capital stock. Tri- Star Marketing employs 11 people, including its officers. See Dun & Bradstreet Business Information Report, April 11, 2000. 2 See 47 U. S. C. § 227; 47 C. F. R. § 64.1200( a)( 3); see also Rules and Regulations Implementing the Telephone Consumer Protection Act of 1991, Report and Order, 7 FCC Rcd 8752, 8779, ¶ 54 (1995) (TCPA Report and Order) (stating that Section 227 of the Act prohibits the use of telephone facsimile machines to send unsolicited advertisements). 3 47 U. S. C. § 503( b)( 1). The Commission has the authority under this section of the Act 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 . . . .” See also 47 U. S. C. § 503( b)( 5) (stating that the Commission has the authority under this section of the Act to assess a forfeiture penalty against any person who is not a common carrier so long as (A) such person is first issued a citation of the violation charged; (B) is given a reasonable opportunity for a personal interview with an official of the Commission, at the field office of the Commission nearest to the person’s place of resident; and (C) subsequently engages in conduct of the type described in the citation). 1 Federal Communications Commission FCC 00- 219 2 II. BACKGROUND 2. On July 12, 1999, in response to several consumer letters indicating that Tri- Star had faxed unsolicited advertisements to consumers’ telephone facsimile machines, the Commission staff issued a citation to Tri- Star, pursuant to section 503 of the Act. 4 The staff cited Tri- Star for allegedly using a telephone facsimile machine, computer, or other device, to send unsolicited advertisements to another telephone facsimile machine, in violation of section 227 of the Act and the Commission’s rules and orders. The unsolicited advertisements offered access to a commercial service, a “Secret Cash Processing Institution” that supposedly would make the consumer an “Instant Millionaire.” The citation, which the staff served by certified mail, return receipt requested, informed Tri- Star that subsequent violations could result in the imposition of monetary forfeitures of up to $11, 000 per violation and included copies of consumer letters that formed the basis of the citation. 5 The citation informed Tri- Star that within 21 days of the date of the citation, it could either request a personal interview at the nearest Commission field office, or could provide a written statement responding to the citation. The Commission received the signed return receipt evidencing Tri- Star’s receipt of the citation on July 16, 1999. Tri- Star provided a written response to the citation, dated July 16, 1999. Nothing in the response justified the violations. 3. Despite the citation’s warning that subsequent violations could result in the imposition of monetary forfeitures, the Commission received several consumer letters stating that Tri- Star had continued to engage in such conduct after receiving the citation. 6 We base our action here on consumer letters sent to the Commission alleging that Tri- Star sent unsolicited advertisements on or after August 18, 1999, more than a month after Tri- Star received the staff’s citation. 7 4 See 47 U. S. C. § 503( b)( 5) (authorizing the Commission to issue citations to non- common carriers for violations of the Act or of the Commission’s rules and orders). 5 The following consumer letters requesting Commission action were attached to the citation: (1) Mark Management, Inc., Request for Commission Action (April 9, 1999) (stating that a number of unsolicited advertisements were received via facsimile from Tri- Star); (2) Denver Medical Society, Request for Commission Action (June 9, 1999) (stating that Denver Medical Society received facsimiles that contained unsolicited advertisements from Tri- Star on April 15, 1999, April 28, 1999, and June 9, 1999); (3) Alexander A. Thieneman Jr. Architect., Request for Commission Action (June 8, 1999) (stating that the office received an unsolicited advertisement via facsimile from Tri- Star); (4) The Better Business Bureau, Request for Commission Action (June 8, 1999) (stating that a company received an unsolicited advertisement via facsimile from Tri- Star); and (5) Office of the Attorney General, State of Florida, Request for Commission Action (June 4, 1999) (stating that within the past two months it received three complaints from individuals or business firms who received unsolicited advertisements via facsimile from Tri- Star). 6 See (1) D. David Haven Jr., Owner of Coastal Response Consultants (Coastal), Request for Commission Action (October 21, 1999) (stating that Coastal received unsolicited facsimile advertisements from Tri- Star on October 10, 1999 and received another unsolicited facsimile advertisement without a header on either October 18, 1999 or October 19,1999); (2) Jeff Olm, as forwarded by the Attorney General of Arkansas, Request for Commission Action (October 14, 1999) (stating that Jeff Olm of Kwik Kopy in North Little Rock, Arkansas received an unsolicited advertisement by fax from Tri- Star on or about September 2, 1999); (3) Stephen R. Crilly, Request for Commission Action (October 15, 1999) (stating that Tri- Star used a telephone facsimile machine to 2 Federal Communications Commission FCC 00- 219 3 4. The Coastal Response Consultants Letter. Mr. D. David Haven, Jr., owner of Coastal Response Consultants (Coastal), an Admiralty and Naval Architecture/ Marine Engineering Firm, states that Tri- Star faxed two unsolicited advertisements to Coastal in October 1999. 8 Mr. Haven states that after receiving an unsolicited advertisement via facsimile from Tri- Star on October 10, 1999, he sent a letter to Tri- Star on October 13, 1999, requesting that it refrain from sending additional unsolicited advertisements and asking that it remove Coastal from its distribution list. 9 Mr. Haven further states that despite this request, Tri- Star faxed another unsolicited advertisement to Coastal on either October 18, 1999, or October 19 1999. 10 Mr. Haven states that neither he or anyone else at Coastal ever gave Tri- Star permission or invitation to send these faxes, and that Coastal does not have an established business relationship with Tri- Star. 11 5. The Rodio & Ursillo Letter. On September 16, 1999, Mr. Jeffrey M. Gibson, a partner in the law firm of Rodio and Ursillo, LTD (R& U), filed a letter requesting Commission action and stating that Tri- Star faxed two unsolicited advertisements to R& U. 12 Mr. Gibson states that after receiving an unsolicited facsimile in March of 1999, he sent a letter to Tri- Star requesting that his number be removed from their distribution list. Mr. Gibson states that by correspondence dated March 23, 1999, Mr. Dary G. Reidlinger, President and CEO of Tri- Star, apologized for the error and assured Mr. Gibson that his number would be removed. 13 In his send an unsolicited advertisement to his fax machine on October 6, 1999); (4) James P. Fawthrop, Request for Commission Action (Sept. 16, 1999) (stating that Tri- Star faxed unsolicited advertisements to his fax machine on September 2, 1999 and on September 15, 1999); (5) Jeffrey M. Gibson, Partner, Rodio & Ursillo, LTD, Request for Commission Action (September 20, 1999) (stating that his firm received an unsolicited advertisement by facsimile from Tri- Star on August 19, 1999); (6) US West, Inc., Request for Commission Action (Sept. 16, 1999) (stating that Tri- Star faxed an unsolicited advertisement to its fax machine in August or September 1999). A letter also was received from Unifield Engineering regarding unsolicited advertisements sent by Tri- Star. This letter, however, will not be used in assessing the forfeiture amount for Tri- Star because we cannot identify the individual complainant. 7 This NAL is based on consumer letters processed by the Commission prior to November 1, 1999. We note that consumer letters processed after November 1, 1999 complaining of unlawful conduct by Tri- Star may form the basis of further enforcement action, if appropriate. 8 See D. David Haven Jr., Request for Commission Action (October 21, 1999). 9 Id. 10 Id. The unsolicited advertisement faxed by Tri- Star did not contain a header and did not identify the date or time sent. 11 Id. 12 See Jeffrey M. Gibson, Partner, Rodio & Ursillo, LTD., Request for Commission Action (September 20, 1999). 13 See Letter from Dary G. Riedlinger, President and CEO Tri- Star Marketing, to Mr. Jeffrey M. Gifson [sic], dated March 23, 1999. 3 Federal Communications Commission FCC 00- 219 4 letter to Mr. Gibson, Mr. Reidlinger stated that his company rents lists, “use[ s] them only once” and deletes them immediately after use. Mr. Gibson states, however, that he received another unsolicited facsimile for Tri- Star on August 19, 1999. Mr. Gibson states that neither he nor anyone else at R& U gave Tri- Star permission or invitation to send advertisements to R& U’s fax machine, and that R& U does not have a prior business relationship with Tri- Star. 6. The Crilly Letter. On October 15, 1999, Mr. Stephen Crilly filed a letter requesting Commission action, stating that Tri- Star sent an unsolicited advertisement to his fax machine. 14 In his Declaration, Mr. Crilly states that he contacted Tri- Star on several occasions to request that his number be removed from Tri- Star’s distribution list. 15 Mr. Crilly states that he spoke with a Tri- Star representative who advised him that his fax number was obtained from a fax vending company. Mr. Crilly states that he did not authorize Tri- Star to send these faxes and that he does not have an established business relationship with Tri- Star. 7. The remaining consumer letters. The remaining consumer letters supporting this NAL are factually similar to the allegations in the consumer letters described above. 16 In each case, the consumer states that Tri- Star used a telephone facsimile machine to send an unsolicited advertisement to the consumer’s telephone facsimile machine. In each case, the consumer states that Tri- Star (a) was not authorized to send the unsolicited facsimile to the consumer’s fax machine, and (b) does not have an established business relationship with the consumer. III. DISCUSSION A. Violations Evidenced in the Letters. 8. Section 227( b)( 1)( C) of the Act prohibits any person from using “a telephone facsimile machine, computer, or other device to send an unsolicited advertisement to a telephone facsimile machine.” 17 An unsolicited advertisement is defined as “any material advertising the commercial availability or quality of any property, goods, or services which is 14 See Declaration of Stephen R. Crilly. 15 Id. 16 See supra note 6 (listing the consumer letters that form the basis for this NAL). 17 47 U. S. C. § 227( b)( 1)( C). Section 227 defines a telephone facsimile machine as “equipment which has the capacity (A) to transcribe text or images, or both, from paper into an electronic signal and to transmit that signal over a regular telephone line, or (B) to transcribe text or images (or both) from an electronic signal received over a regular telephone line onto paper.” 47 U. S. C. § 227( a)( 2). This blanket prohibition applies to all unsolicited advertisements transmitted by telephone facsimile machines. The Act does not permit the sending of unsolicited advertisements by facsimile to either business or residential telephone facsimile machines. 4 Federal Communications Commission FCC 00- 219 5 transmitted to any person without that person’s prior express invitation or permission.” 18 The Commission has determined, however, that an established business relationship establishes consent to receive telephone facsimile advertisement transmissions. 19 The mere distribution or publication of a telephone facsimile number does not confer invitation or permission to transmit advertisements to a particular telephone facsimile machine. 20 9. As discussed above, each facsimile transmission upon which this NAL is based offers access to the same commercial service, a “Secret Cash Processing Institution [That] Will Make You An ‘Instant Millionaire’ with a Unique Million Dollar ‘Cash Account’ Opened Up Just For You – Guaranteed!” We find that these facsimiles clearly fall within the definition of an “advertisement.” Additionally, Tri- Star appears to have sent each facsimile transmission without the prior express invitation or permission of the recipient. The record indicates that none of the consumers at issue had an established business relationship with Tri- Star. The record further indicates that Tri- Star continued to send faxes to consumers who specifically requested that their fax numbers be removed from Tri- Star’s distribution list. Such evidence demonstrates that Tri- Star did not have any prior express permission or invitation to send the facsimile transmissions. B. Forfeiture Amount. 10. Tri- Star apparently willfully or repeatedly violated the Act and the Commission’s rules and orders by using a telephone facsimile machine to send unsolicited advertisements to other telephone facsimile machines. Tri- Star apparently did not cease its unlawful conduct even after the Commission issued a citation warning that it was engaging in unlawful conduct and could be subject to monetary forfeitures. Accordingly, a proposed forfeiture is warranted against Tri- Star for its apparent willful or repeated violations of section 227 of the Act and of the Commission’s rules and orders regarding the faxing of unsolicited advertisements. 11. Section 503( b) of the Act authorizes the Commission to assess a forfeiture of up to $11,000 for each violation of the Act or of any rule, regulation, or order issued by the Commission under the Act by a non- common carrier or other entity not specifically designated in section 503 of the Act. 21 In exercising such authority, we are to take into account “the 18 47 C. F. R. § 64. 1200( f)( 5). 19 See Rules and Regulations Implementing the Telephone Consumer Protection Act of 1991, Memorandum Opinion and Order, 10 FCC Rcd 12391, 12408, ¶ 37 (1995) (TCPA Memorandum Opinion and Order). 20 Id. 21 Section 503( b)( 2)( C) provides for forfeitures up to $10,000 for each violation by cases not covered by subparagraphs (A) or (B), which address forfeitures for violations by licensees and common carriers, among others. See 47 U. S. C. § 503( b). The Commission amended its rules by adding a new subsection to its monetary forfeiture provisions that incorporates by reference the inflation adjustment requirements contained in the Debt Collection Improvement Act of 1996, Pub. L. 104- 134, Sec. 31001, 110 Stat. 1321, enacted on April 26, 1996. 5 Federal Communications Commission FCC 00- 219 6 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.” 22 12. Although the Commission’s Forfeiture Policy Statement does not establish a base forfeiture amount for violating the prohibition on using a telephone facsimile machine to send unsolicited advertisements, we have previously used $4,500 per unsolicited fax advertisement as an appropriate base amount. 23 We apply that base amount to each of six of the apparent violations. We find that the other two violations justify a higher proposed forfeiture because Tri- Star apparently faxed unsolicited advertisements to R& U and Coastal after each had requested that Tri- Star refrain from faxing unsolicited advertisements. We find that in each case, these consumers specifically notified Tri- Star to cease its unlawful conduct, but Tri- Star willfully and repeatedly continued to violate section 227 of the Act and the Commission’s rules and orders. We believe that assessing a higher forfeiture amount is warranted based on the nature and gravity of the violations and the continued need to ensure compliance with section 227 of the Act and the Commission’s rules and orders. For those two violations, we find Tri-Star apparently liable in the amount of $10,000. This results in a total forfeiture of $47,000. Tri- Star shall have the opportunity to submit evidence and arguments in response to this NAL to show that no forfeiture should be imposed or that some lesser amount should be assessed. 24 IV. CONCLUSION AND ORDERING CLAUSES 13. We have determined that Tri- Star apparently violated section 227 of the Act and the Commission’s rules and orders by using a telephone facsimile machine, computer, or other device to send eight unsolicited advertisements to the consumers identified above. We have further determined that Tri- Star is apparently liable for forfeitures in the amount of $47,000. 14. Accordingly, IT IS ORDERED, pursuant to section 503( b)( 5) of the Act, as amended, 47 U. S. C. § 503( b)( 5), and section 1.80 of the Commission’s rules, 47 C. F. R. § 1. 80, that Tri- Star Marketing, Inc. IS HEREBY NOTIFIED of an Apparent Liability for Forfeiture in the amount of $47,000 for willful or repeated violations of section 227( b)( 1)( C) of the Act, 47 U. S. C. § 227( b)( 1)( C), sections 64.1200( a)( 3), 64. 1200( f)( 5), of the Commission’s rules, 47 Thus, the maximum statutory forfeiture pursuant to section 503( b)( 2)( C) increased from $10, 000 to $11, 000. See Amendment of Section 1. 80 of the Commission’s Rules, 12 FCC Rcd 1038 (1997). 22 47 U. S. C. § 503( b)( 2)( D); 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, 17100- 17101, ¶ 27 (1997), recon. denied, 15 FCC Rcd 303 (1999) (Forfeiture Policy Statement). 23 See Get- Aways, Inc., Notice of Apparent Liability For Forfeiture, 15 FCC Rcd. 1805 (1999; Get- Aways, Inc, Forfeiture Order, FCC 00- 67 (released March 2, 2000). 24 See 47 U. S. C. § 503( b)( 4)( C); 47 C. F. R. § 1. 80( f)( 3). 6 Federal Communications Commission FCC 00- 219 7 C. F. R. §§ 64. 1200( a)( 3), 64.1200( f)( 5), and the related orders described in the paragraphs above. 15. IT IS FURTHER ORDERED, pursuant to section 1.80 of the Commission’s rules, 47 C. F. R. § 1.80, that within thirty (30) days of the release of this Notice, Tri- Star Marketing, Inc. SHALL PAY the full amount of the proposed forfeiture 25 OR SHALL FILE a response showing why the proposed forfeiture should not be imposed or should be reduced. 16. IT IS FURTHER ORDERED that a copy of this Notice of Apparent Liability for Forfeiture SHALL BE SENT by certified mail to Dary Riedlinger, Owner, Tri- Star Marketing, Inc., 2906 & 2910 Hoyt Ave., Everett, Washington 98201. FEDERAL COMMUNICATIONS COMMISSION Magalie Roman Salas Secretary 25 The forfeiture amount should be paid by check or money order drawn to the order of the Federal Communications Commission. Reference should be made on Tri- Star Marketing, Inc. ’s check or money order to “NAL/ Acct/ No. X3217- 005.” Such remittances must be mailed to Forfeiture Collection Section, Finance Branch, Federal Communications Commission, P. O. Box 73482, Chicago, Illinois 60673- 7482. 7