Overview of Enforcement Action
On June 1, 2011, the Federal Communications Commission's Enforcement Bureau Spectrum Enforcement Division released a Notice of Apparent Liability for Forfeiture (DA 11-976) against SmartLabs, Inc. The Commission found SmartLabs apparently liable for a monetary forfeiture of $10,000 for willful and repeated violations of Section 302(b) of the Communications Act of 1934, as amended, and Section 2.803(a)(1) of the Commission's rules.
The enforcement action stems from SmartLabs' manufacturing and marketing of an unauthorized intentional radiator device in the United States without having obtained the requisite equipment certification.
Investigation and Background
The Spectrum Enforcement Division initiated an investigation via a Letter of Inquiry on May 21, 2010, after discovering that the INSTEON RemoteLinc Wireless Remote Control Model #2440 was marketed with an FCC identifier that did not appear in the Commission's equipment authorization database.
In its June 17, 2010 response, SmartLabs confirmed that it had begun manufacturing and marketing the RemoteLinc in the United States in May 2007 and continued sales within the past year. SmartLabs explained that key technical and project leadership staff had departed while the product was nearing completion, leading the incoming team to mistakenly assume the product could be shipped once lab testing was completed while certification remained pending. SmartLabs subsequently obtained equipment certification for the device on June 3, 2010.
Legal Analysis and Upward Adjustment
Under Section 15.201(b) and Section 2.803(a)(1) of the Commission's rules, intentional radiators must receive an equipment grant of certification prior to being marketed, sold, or shipped in the United States. Although the base forfeiture amount for marketing unauthorized equipment is $7,000 per model, the Bureau determined an upward adjustment to $10,000 was warranted.
The Bureau noted that the marketing violations continued for more than three years and that affixing an ungranted identifier affirmatively misled consumers into believing the remote had satisfied FCC certification standards. The Commission reiterated that lack of regulatory understanding or employee turnover does not constitute a mitigating factor.
Order and Payment Terms
SmartLabs was ordered to either pay the proposed $10,000 forfeiture within thirty days of the order's release date or submit a written statement seeking reduction or cancellation supported by appropriate documentation.
The grant of equipment certification obtained on June 3, 2010, applies only to devices manufactured and marketed on or after that date and does not eliminate liability for earlier marketing violations.