**Before the**

Federal Communications Commission

Washington, D.C. 20554

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| In the Matter of                 | *  | File No. EB-08-SE-1068       |
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| Bright House Networks, LLC       | ** | NAL/Acct. No. 2008321000009  |
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|                                  | *  | FRN 0018103622               |
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Notice OF apparent liability for forfeiture AND ORDER

**Adopted: January 19, 2009 Released: January 19, 2009**

By the Chief, Enforcement Bureau:

# introduction

1.  In this *Notice of Apparent Liability for Forfeiture and Order*
    ("*NAL*"), we find that Bright House Networks, LLC ("Bright House")
    apparently willfully violated a Commission Order and Section 76.939
    of the Commission's Rules ("Rules") in failing to respond fully to
    an Enforcement Bureau Letter of Inquiry.[^1] We conclude, pursuant
    to Section 503(b) of the Communications Act of 1934, as amended
    ("Act"),[^2] that Bright House is apparently liable for a forfeiture
    in the amount of twenty-five thousand dollars (\$25,000). We also
    order Bright House to respond fully to the LOI within ten (10) days
    of release of this *NAL.* If Bright House again fails to submit a
    complete response, it will be subject to further enforcement action.

# background

2.  In response to consumer complaints against Bright House, on October
    30, 2008, the Enforcement Bureau ("Bureau") issued a Letter of
    Inquiry ("LOI") regarding the company's migration of analog
    programming to digital tiers.[^3] The LOI sought information
    concerning instances in which Bright House had migrated analog
    channels to a digital tier, including the channels affected, whether
    and how the company notified customers of the change, whether, in
    light of the change in service, the company permitted customers to
    change their service tier without charge, and the rates charged
    customers before and after the channel migration. The LOI also asked
    about Bright House's charges for digital set-top boxes as well as
    information regarding Bright House's subscriber rates and the rates
    it pays to video programmers.

3.  Although Bright House filed a response to the LOI,[^4] many of
    Bright House's answers to questions in the LOI are non-responsive or
    incomplete. For example, Bright House's response to Question 1.g.
    (whether Bright House implemented a rate reduction in connection
    with any analog-to-digital channel changes) simply states that "all
    rates have been set in accordance with applicable rate
    regulations\..." without addressing the specific question of whether
    any rate reductions were implemented to reflect the reduction in the
    number of channels accessible to analog-only subscribers.[^5] In
    response to Question 3.a. (whether Bright House provided written
    notice to subscribers of the analog-to-digital channel change),
    Bright House provides copies of the notices but not the date on
    which each notice was provided to subscribers.[^6] In response to
    Question 4 (regarding notices to Local Franchising Authorities of
    the analog-to-digital migration), Bright House provides only a
    sampling of the documents requested,[^7] and in response to Question
    5.b. (documents furnished to customer service personnel in
    responding to subscriber questions about the analog-to-digital
    channel change(s)), Bright House fails to provide any of the
    requested documents.[^8] In response to Questions 6 (complaints
    regarding analog-to-digital channel change(s)), Bright House
    identifies two complaints but fails to provide copies of these
    complaints.[^9] In response to Question 7 (oral complaints regarding
    analog-to-digital channel changes), Bright House admits to receiving
    oral complaints but fails to identify the number of such complaints
    or the existence of any records relating to these complaints.[^10]
    Bright House claims that the 14-day time period allowed in which to
    respond to these questions and the failure of the LOI to cite
    specific rule sections interfered with its ability to respond fully
    to these questions.[^11]

4.  In addition and more troubling, Bright House simply evades Questions
    8.b (the per-subscriber fees it pays to video programming
    distributors for those channels subject of the inquiry) by
    responding that there are no channels to which this question would
    apply because channels are not provided to its customers on a
    fee-per-channel basis.[^12] While Bright House may not price
    specific channels on a per-subscriber basis, the question asks for
    the fees it pays to video programming distributors on a
    per-subscriber fee basis. Bright House's response is non-responsive
    and misleading to the extent it does pay such fees to video
    programming distributors.

# discussion

## Failure to Respond Fully to the LOI

5.  We find that Bright House's failure to fully respond to the Bureau's
    inquiry constitutes an apparent willful[^13] violation of a
    Commission order and Section 76.939 of the Rules. The Bureau
    directed Bright House to provide certain information related to the
    movement of analog channels to digital tiers. This information was
    necessary to enable the Commission to perform its enforcement
    function and evaluate whether Bright House violated Commission
    rules. There is no question that Bright House received the LOI. To
    date, however, Bright House has failed to provide a full and
    complete response.

6.  The Commission has broad investigatory authority under Sections
    4(i), 4(j), and 403 of the Act, its Rules, and relevant precedent.
    Section 4(i) authorizes the Commission to "issue such orders, not
    inconsistent with this Act, as may be necessary in the execution of
    its functions."[^14] Section 4(j) states that "the Commission may
    conduct its proceedings in such manner as will best conduce to the
    proper dispatch of business and to the ends of justice."[^15]
    Section 403 grants the Commission "full authority and power to
    institute an inquiry, on its own motion \... relating to the
    enforcement of any of the provisions of this Act."[^16] Pursuant to
    Section 76.939 of the Rules, a cable operator must comply with FCC
    requests for information, orders, and decisions.[^17] In carrying
    out this obligation, a cable operator also must provide truthful and
    accurate statements to the Commission or its staff in any
    investigatory or adjudicatory matter within the Commission's
    jurisdiction.[^18] Lastly, numerous FCC decisions have reaffirmed
    the Commission's authority to investigate potential misconduct and
    punish those that disregard FCC inquiries. [^19] The Commission
    delegated this authority to the Enforcement Bureau in Section
    0.111(a)(16) of the Rules.[^20]

7.  Bright House alleges that it could not have responded fully to the
    LOI because the amount of time allowed for the preparation of the
    company's LOI response was too brief.[^21] Certain complaints
    received by the Commission regarding the migration of analog
    programming to a digital tier, however, allege that cable operators
    were falsely linking the programming changes with the digital
    television transition. Because of the strong public interest in
    avoiding confusion about the transition and the rapidly approaching
    transition date, the Bureau determined that two weeks was an
    appropriate deadline and we conclude that two weeks was a reasonable
    deadline. Bright House does not dispute that this decision was
    within our discretion. Thus, Bright House was obligated to respond
    by our deadline. Moreover, we note that since it submitted its LOI
    response and while this matter remains under investigation by the
    Bureau, Bright House has neither contacted the Bureau about its
    response nor provided any supplemental information. We find
    therefore that Bright House's failure to fully respond to the
    Bureau's inquiry constitutes an apparent willful[^22] violation of a
    Commission order and Section 76.939 of the Rules.

## Proposed Forfeiture

8.  We conclude that Bright House is apparently liable for forfeiture
    for its apparent willful violation of a Commission Order and Section
    76.939 of the Rules. Under Section 503(b)(1)(B) of the Act, any
    person who is determined by the Commission to have willfully or
    repeatedly failed to comply with any provision of the Act or any
    rule, regulation, or order issued by the Commission shall be liable
    to the United States for a forfeiture penalty.[^23] To impose such a
    forfeiture penalty, the Commission must issue a notice of apparent
    liability and the person against whom such notice has been issued
    must have an opportunity to show, in writing, why no such forfeiture
    penalty should be imposed.[^24] The Commission will then issue a
    forfeiture if it finds by a preponderance of the evidence that the
    person has violated the Act or a Commission rule.[^25] We conclude
    under this standard that Bright House is apparently liable for
    forfeiture for its apparent willful violation of a Commission Order
    and Section 76.939 of the Rules.

9.  Under Section 503(b)(2)(A) of the Act,[^26] we may assess a cable
    operator a forfeiture of up to \$37,500 for each violation, or for
    each day of a continuing violation up to a maximum of \$375,000 for
    a single act or failure to act. In exercising such authority, we are
    required to 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."[^27]

10. Section 1.80 of the Rules and the Commission's *Forfeiture Policy
    Statement* establish a base forfeiture amount of \$4,000 for failure
    to respond to Commission communications.[^28] We find that Bright
    House's failure to respond fully to the LOI in the circumstances
    presented here warrants a significant increase to this base amount.
    Misconduct of this type exhibits contempt for the Commission's
    authority and threatens to compromise the Commission's ability to
    adequately investigate violations of its rules. Prompt and full
    responses to Bureau inquiry letters are essential to the
    Commission's enforcement function. In this case, Bright House's
    apparent violations have delayed our investigation and inhibited our
    ability to examine allegations raised in consumer complaints and
    potentially touching on an area of critical importance \-- the DTV
    transition. We further note that Bright House failed to provide a
    full and complete LOI response even after receiving a specific
    warning from the Commission's General Counsel that such actions
    could be subject to enforcement penalties.[^29]

11. Based on these facts, we therefore propose a twenty-five thousand
    dollar (\$25,000) forfeiture against Bright House for failing to
    respond fully to Commission communications. This forfeiture amount
    is consistent with precedent in similar cases, where companies
    failed to provide complete responses to Bureau inquiries concerning
    compliance with the Commission's Rules despite evidence that the
    LOIs had been received.[^30]

12. We also direct Bright House to respond fully to the October 30, 2008
    LOI within ten (10) days of the release of this Notice of Apparent
    Liability for Forfeiture and Order. Failure to do so may constitute
    an additional violation subjecting Bright House to further
    penalties, including potentially higher monetary forfeitures.[^31]

# ordering clauses

13. Accordingly, **IT IS ORDERED** that, pursuant to Section 503(b) of
    the Act, and Section 1.80 of the Rules, and the authority delegated
    by Sections 0.111 and 0.311 of the Commissions Rules, **Bright House
    Networks, LLC** is **NOTIFIED** of its **APPARENT LIABILITY FOR A
    FORFEITURE** in the amount of twenty-five thousand dollars
    (\$25,000) for its willful violation of a Commission Order and
    Section 76.939 of the Rules.

14. **IT IS FURTHER ORDERED** that, pursuant to Section 1.80 of the
    Rules, within thirty (30) days of the release date of this Notice of
    Apparent Liability for Forfeiture and Order, Bright House **SHALL
    PAY** the full amount of the proposed forfeiture or **SHALL FILE** a
    written statement seeking reduction or cancellation of the proposed
    forfeiture.

15. **IT IS FURTHER ORDERED** that, pursuant to sections 1, 4(i), 4(j),
    403 of the Communications Act of 1934, as amended, 47 U.S.C. §151,
    154(i), 154(j), 403, Bright House shall fully respond to the October
    30, 2008 Letter of Inquiry sent by the Enforcement Bureau in the
    manner described by that Letter of Inquiry within ten (10) days of
    the release of this Notice of Apparent Liability and Order.

16. Payment of the forfeiture must be made by check or similar
    instrument, payable to the order of the Federal Communications
    Commission. The payment must include the NAL/Account Number and FRN
    Number referenced above. Payment by check or money order may be
    mailed to Federal Communications Commission, P.O. Box 979088, St.
    Louis, MO 63197-9000. Payment by overnight mail may be sent to U.S.
    Bank -- Government Lockbox #979088, SL-MO-C2-GL, 1005 Convention
    Plaza, St. Louis, MO 63101. Payment by wire transfer may be made to
    ABA Number 021030004, receiving bank TREAS/NYC, and account
    number 27000001. For payment by credit card, an FCC Form 159
    (Remittance Advice) must be submitted. When completing the FCC Form
    159, enter the NAL/Account number in block number 23A (call
    sign/other ID), and enter the letters "FORF" in block number 24A
    (payment type code). Requests for full payment under an installment
    plan should be sent to: Chief Financial Officer \-- Financial
    Operations, 445 12th Street, S.W., Room 1-A625, Washington,
    D.C. 20554. Please contact the Financial Operations Group Help Desk
    at 1-877-480-3201 or Email: ARINQUIRIES@fcc.gov with any questions
    regarding payment procedures. Bright House will also send electronic
    notification on the date said payment is made to
    JoAnn.Lucanik@fcc.gov and nissa.laughner@fcc.gov.

17. The response, if any, must be mailed to the Office of the Secretary,
    Federal Communications Commission, 445 12th Street, S.W.,
    Washington, D.C. 20554, ATTN: Enforcement Bureau -- Spectrum
    Enforcement Division, and must include the NAL/Acct. No. referenced
    in the caption. The response should also be e-mailed to JoAnn
    Lucanik, Deputy Chief, Spectrum Enforcement Division, Enforcement
    Bureau, FCC, at JoAnn.Lucanik@fcc.gov and Nissa Laughner, Esq.,
    Spectrum Enforcement Division, FCC, at nissa.laughner@fcc.gov.

18. The Commission will not consider reducing or canceling a forfeiture
    in response to a claim of inability to pay unless the petitioner
    submits: (1) federal tax returns for the most recent three-year
    period; (2) financial statements prepared according to generally
    accepted accounting practices; or (3) some other reliable and
    objective documentation that accurately reflects the petitioner's
    current financial status. Any claim of inability to pay must
    specifically identify the basis for the claim by reference to the
    financial documentation submitted.

19. **IT IS FURTHER ORDERED** that a copy of this Notice of Apparent
    Liability for Forfeiture and Order shall be sent by first class mail
    and certified mail return receipt requested to Kristi S.
    Kramersmeier, Vice President, New Product Development, Bright House
    Networks, LLC, 5000 Campuswood Drive, East Syracuse, New York,
    13057-1254, and to counsel for Bright House Networks, LLC, Paul
    Hudson, Esq., Davis Wright Tremaine LLP, 1919 Pennsylvania Avenue
    NW, Suite 200, Washington D.C. 20006.

    FEDERAL COMMUNICATIONS COMMISSION

Kris Anne Monteith

Chief, Enforcement Bureau

[^1]: 47 C.F.R. § 76.939.

[^2]: 47 U.S.C. § 503(b).

[^3]: Letter from Kathryn S. Berthot, Chief, Spectrum Enforcement
    Division, Enforcement Bureau, Federal Communications Commission to
    Micah M. Caldwell, Esq., Counsel for Bright House Networks, LLC
    (Oct. 30, 2008) ("LOI").

[^4]: Letter from Kristi S. Kramersmeier, Vice President, New Product
    Development, Bright House Networks, LLC to Marlene H. Dortch,
    Secretary, Federal Communications Commission (Nov. 13, 2008) ("LOI
    Response"). We note that Bright House seeks confidential treatment
    of the entirety of its LOI Response. *See* Letter from Paul B.
    Hudson, Counsel for Bright House Networks, LLC, Davis, Wright,
    Tremaine LLP to Marlene H. Dortch, Secretary, Federal Communications
    Commission (Nov. 13, 2008). We do not rule on Bright House's request
    for confidentiality at this time.

[^5]: LOI Response at 4.

[^6]: The notification dates generally are not discernible from the
    notices themselves. *See* LOI at 3 (requiring Bright House to
    provide the notice dates to the extent that information is not
    available on each notice itself).

[^7]: LOI Response at 6.

[^8]: *Id*. at 7.

[^9]: *Id*. at 7-8.

[^10]: *Id*. at 8.

[^11]: *Id*. at 3.

[^12]: *Id*. at 8.

[^13]: Section 312(f)(1) of the Act defines willful as "the conscious
    and deliberate commission or omission of \[any\] act, irrespective
    of any intent to violate" the law. 47 U.S.C. § 312(f)(1). The
    legislative history of Section 312(f)(1) of the Act indicates that
    this definition of willful applies to both Sections 312 and 503(b)
    of the Act, H.R. Rep. No. 97-765, 97th Cong. 2d Sess. 51 (1982), and
    the Commission has so interpreted the term in the Section 503(b)
    context. *See, e.g., Southern California Broadcasting Co.*,
    Memorandum Opinion and Order, 6 FCC Rcd 4387, 4387-88 ¶ 5 (1991)
    ("*Southern California Broadcasting*").

[^14]: 47 U.S.C. § 154(i).

[^15]: 47 U.S.C. § 154(j).

[^16]: 47 U.S.C. § 403.

[^17]: 47 C.F.R. § 76.939 ("Cable operators shall comply with ... the
    Commission's requests for information, orders, and decisions.").

[^18]: *See* 47 C.F.R. § 1.17.

[^19]: *See, e.g., SBC Communications, Inc.*, Forfeiture Order, 17 FCC
    Rcd 7589, 7599-7600 ¶¶ 23-28 (ordering \$100,000 forfeiture for
    egregious and intentional failure to certify the response to a
    Bureau inquiry) ("*SBC Forfeiture Order*"); *Globcom, Inc.,* Notice
    of Apparent Liability for Forfeiture and Order, 18 FCC Rcd 19893,
    19898 n. 36 (2003) (noting delayed response to an LOI is considered
    dilatory behavior which may result in future sanctions) (subsequent
    history omitted); *Digital Antenna, Inc.,* Notice of Apparent
    Liability for Forfeiture and Order, 23 FCC Rcd 7600, 7602 (Spectr.
    Enf. Div., Enf. Bur. 2008) (proposing \$11,000 forfeiture for
    failure to respond to provide a complete response to an LOI);
    *BigZoo.Com Corporation*, Forfeiture Order, 20 FCC Rcd 3954 (Enf.
    Bur. 2005) (ordering \$20,000 forfeiture for failure to respond to
    an LOI); *World Communications Satellite Systems, Inc.*, Forfeiture
    Order, 19 FCC Rcd 2718 (Enf. Bur. 2004) (ordering a \$10,000
    forfeiture for non-responsive reply to an LOI); *Donald W. Kaminski,
    Jr.*, Forfeiture Order, 18 FCC Rcd 26065 (Enf. Bur. 2003) (ordering
    \$4,000 forfeiture for individual's failure to respond to an LOI).

[^20]: 47 C.F.R. §0.111(a)(16) (granting the Enforcement Bureau
    authority to "\[i\]dentify and analyze complaint information,
    conduct investigations, conduct external audits and collect
    information, including pursuant to sections 218, 220, 308(b), 403
    and 409(e) through (k) of the Communications Act, in connection with
    complaints, on its own initiative or upon request of another Bureau
    or Office."). *See also* 47 C.F.R. §§0.111(a)(13) (Enforcement
    Bureau has authority to "\[r\]esolve complaints regarding
    multichannel video and cable television service under part 76 of the
    Commission\'s rules"); 0.311 (general delegated authority for
    Enforcement Bureau).

[^21]: *See* LOI response at 3, 6.

[^22]: Section 312(f)(1) of the Act defines willful as "the conscious
    and deliberate commission or omission of \[any\] act, irrespective
    of any intent to violate" the law. 47 U.S.C. § 312(f)(1). The
    legislative history of Section 312(f)(1) of the Act indicates that
    this definition of willful applies to both Sections 312 and 503(b)
    of the Act, H.R. Rep. No. 97-765, 97th Cong. 2d Sess. 51 (1982), and
    the Commission has so interpreted the term in the Section 503(b)
    context. *See, e.g., Southern California Broadcasting Co.*,
    Memorandum Opinion and Order, 6 FCC Rcd 4387, 4387-88 ¶ 5 (1991)
    ("*Southern California Broadcasting*").

[^23]: 47 U.S.C. § 503(b)(1)(B); 47 C.F.R. § 1.80(a)(1).

[^24]: 47 U.S.C. § 503(b); 47 C.F.R. § 1.80(f).

[^25]: *See, e.g.,* *SBC Forfeiture Order*, 17 FCC Rcd at 7591.

[^26]: 47 U.S.C. § 503(b)(2)(A). The Commission has amended Section
    1.80(b)(3) of the Rules, 47 C.F.R. § 1.80(b)(3), three times to
    increase the maximum forfeiture amounts, in accordance with the
    inflation adjustment requirements contained in the Debt Collection
    Improvement Act of 1996, 28 U.S.C. § 2461. *See Amendment of Section
    1.80 of the Commission's Rules and Adjustment of Forfeiture Maxima
    to Reflect Inflation*, 23 FCC Rcd 9845 (2008) (adjusting the maximum
    statutory amounts for broadcasters and cable operators from
    \$32,500/\$325,000 to \$37,500/\$375,000); *Amendment of Section
    1.80 of the Commission's Rules and Adjustment of Forfeiture Maxima
    to Reflect Inflation,* Order, 19 FCC Rcd 10945 (2004) (adjusting the
    maximum statutory amounts for broadcasters and cable operators from
    \$27,500/\$300,000 to \$32,500/\$325,000); *Amendment of Section
    1.80 of the Commission's Rules and Adjustment of Forfeiture Maxima
    to Reflect Inflation,* Order, 15 FCC Rcd 18221 (2000) (adjusting the
    maximum statutory amounts for broadcasters and cable operators from
    \$25,000/\$250,000 to \$27,500/\$300,000). The most recent inflation
    adjustment took effect September 2, 2008 and applies to violations
    that occur after that date. *See* 73 Fed. Reg. 44663-5. Bright
    House's apparent violations occurred after September 2, 2008 and are
    therefore subject to the higher forfeiture limits.

[^27]: 47 U.S.C. § 503(b)(2)(E). *See also* 47 C.F.R. § 1.80(b)(4), Note
    to paragraph (b)(4): Section II. Adjustment Criteria for Section 503
    Forfeitures.

[^28]: *See* 47 C.F.R. § 1.80(b)(4); *The Commission's Forfeiture Policy
    Statement and Amendment of Section 1.80 of the Rules to Incorporate
    the Forfeiture Guideline*s*,* Report and Order, 12 FCC Rcd 17087
    (1997), *recon. denied,* 15 FCC Rcd 303 (1999).

[^29]: *See* Letter from Matthew Berry, General Counsel, Federal
    Communications Commission, to Micah Caldwell, Esq., Counsel for
    Bright House Networks, LLC, Fleishman and Harding, LLP at 2 (Nov.
    12, 2008).

[^30]: *See supra* note 17.

[^31]: We do not decide in this *NAL* whether the failure to respond to
    an LOI constitutes a continuing violation.