**Before the**

**Federal Communications Commission**

**Washington, D.C. 20554**

+----------------------------------+----+------------------------------+
|                                  |    |                              |
+----------------------------------+----+------------------------------+
|                                  |    |                              |
+----------------------------------+----+------------------------------+
| In the Matter of                 | *  | File No. EB-02-TC-038        |
|                                  | *) |                              |
| Arbros Communications, Inc.      | ** | NAL/Acct. No. 200332170001   |
|                                  |    |                              |
| Apparent Liability for           | *  | FRN: 0003793205              |
| Forfeiture                       | *) |                              |
|                                  | ** |                              |
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|                                  | *) |                              |
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|                                  | *  |                              |
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+----------------------------------+----+------------------------------+

**NOTICE OF APPARENT LIABILITY FOR FORFEITURE**

**Adopted: March 4, 2003 Released: March 6, 2003**

By the Chief, Enforcement Bureau:

#### INTRODUCTION

1.  In this Notice of Apparent Liability for Forfeiture ("NAL"),[^1] we
    find that Arbros Communications, Inc. ("Arbros")[^2] apparently
    willfully or repeatedly violated section 214(a) of the
    Communications Act of 1934, as amended (the "Act"),[^3] and sections
    63.61, 63.71, and 63.505 of the Commission's rules[^4] by
    discontinuing its domestic interstate access service in California,
    Delaware, Maryland, Massachusetts, New Jersey, New York,
    Pennsylvania, Virginia, and Washington, D.C. as well as all of its
    interstate long distance service, before receiving authorization to
    do so from the Commission. As a result, Arbros's former customers
    apparently were without service for up to seven weeks, causing
    significant disruption to their businesses. Upon our review of the
    facts and circumstances surrounding these apparent violations, we
    find that Arbros is apparently liable for a forfeiture in the amount
    of \$5000 for each of ten discontinuance violations, for a total of
    \$50,000.

# II. BACKGROUND {#ii.-background .unnumbered}

2.  Arbros is a non-dominant provider of resold local exchange, resold
    exchange access, resold long distance, private line, and data
    services in twelve states. According to Arbros, late in 2001, it
    determined that continued provision of resold service would not be
    in its best interest. Accordingly, in October 2001, it decided to
    lay off about 80 percent of its employees. Subsequently, it
    informally told the carriers whose services it had resold ("upstream
    providers") of its plans to exit the business.[^5] After being
    contacted by the staff of the Common Carrier Bureau ("CCB"), on
    March 1, Arbros filed an application for discontinuance with the
    Commission, stating that between February 12 and February 14, 2002,
    Arbros sent notices to the affected customers stating that service
    would be discontinued on March 4, 2002. The notice to Arbros's
    customers stated that the FCC will normally authorize the proposed
    discontinuance of service unless it is shown that the customers
    would be unable to receive service or a reasonable substitute from
    another carrier or that the public convenience and necessity is
    otherwise affected. Arbros's application for discontinuance,
    however, was filed too late to expect Commission action by the March
    4 date given in the customer notice, since the Commission's rules
    provide that the authorization would (in the absence of action to
    the contrary) be automatically granted only after a 31-day period.
    In response to complaints from consumers who received the notice and
    stated that Arbros could not be reached on the telephone number set
    forth in the notice, Arbros filed a supplemental application with a
    revised notice that was also sent to its customers, stating that
    Arbros planned to disconnect service on March 16, 2002, and that
    Arbros would request waiver of the 31-day requirement.[^6] In fact,
    interstate exchange access and long distance service to some
    customers was cut off without Commission authorization during the
    third week of March 2002.[^7] Arbros asserts that this service
    termination was not its fault, but was caused by its upstream
    providers cutting off service to Arbros on February 27, 2002 and
    March 18, 2002. Arbros has not determined whether it will declare
    bankruptcy, although it states that it does have liquidity problems
    and billing disputes, and has attempted to resolve issues with
    creditors as they arise.[^8]

3.  Our staff sent a letter of inquiry to Arbros on April 5, 2002
    inquiring, among other things, about the number of customers whose
    service was discontinued or reduced, whether they received service
    from other providers, and the circumstances of the discontinuances.
    Arbros filed a response on May 13, 2002, requesting confidential
    treatment for the entire response. In reply to a telephonic request
    by our staff, Arbros filed a letter on September 5 identifying those
    portions of the May 13 response for which it was requesting
    confidentiality.[^9]

4.  In its response, Arbros claimed that that there was no
    discontinuance by Arbros. First, it stated that it believes that
    none of its customers stopped receiving service because its
    customers had already changed service providers. In support of this
    belief, Arbros noted (1) that it informed its upstream providers of
    the identity of its customers with the understanding that these
    providers would be contacting customers regarding migration and (2)
    it worked with customers to obtain other service providers and
    advised all customers with current bills that Arbros would continue
    to provide their service until cutovers were completed.[^10] Second,
    Arbros stated that any discontinuance that occurred resulted from
    the actions of its upstream providers in terminating service.[^11]

5.  Arbros' upstream providers claimed that only 40 of the 306 Arbros
    customers migrated to their systems.[^12] Moreover, several former
    Arbros customers have furnished declarations stating that they were
    discontinued by Arbros and lost service for varying periods of
    time.[^13] For example, Royall & Company lost service for four weeks
    and Conard-Pyles Company lost service for seven weeks.[^14] In
    several instances, declarants claimed that Arbros gave them
    incorrect information or could not be reached to arrange for
    migration to another service.[^15] Declarants claimed that their
    companies were damaged due to the discontinuance by loss of clients,
    reduction in cash flow, increase in administrative costs and support
    time, lack of communications with the company's branch office, and
    the need to travel to branch offices or hire couriers to communicate
    with branch offices.[^16] Further, one of the upstream providers
    claims that (1) it never terminated service to Arbros, (2) Arbros
    never paid its last invoice after notifying the upstream provider
    that it would no longer supply long distance service, and (3) the
    upstream provider generally offers only wholesale service, but
    accommodated Arbros' customers to avoid elimination of service to
    those customers who wished to migrate to it.[^17]

# II. DISCUSSION {#ii.-discussion .unnumbered}

## A. Apparent Violations Evidenced in the Record  {#a.-apparent-violations-evidenced-in-the-record .unnumbered}

6.  As explained below, Arbros's business practices evidence apparent
    willful or repeated violations of section 214(a) of the Act and
    sections 63.61, 63.71, and 63.505 of the Commission's rules.

7.  Arbros's application for discontinuance authorization and its
    response to our staff's inquiries establish that Arbros did not meet
    its obligations as a common carrier to adequately notify its
    customers of the discontinuance or obtain Commission approval before
    it discontinued service, in apparent violation of section 214(a) of
    the Act and sections 63.61, 63.71, and 63.505 of the Commission's
    rules. Section 214(a) has an essential role in the Commission's
    efforts to protect consumers. Unless the Commission has the ability
    to determine whether a discontinuance of service is in the public
    interest, it cannot protect customers from having essential services
    cut off without adequate warning, or ensure that these customers
    have other viable alternatives.[^18] It appears that Arbros's
    customers were left without service for periods of up to seven
    weeks.[^19] Apparently, less than 15 percent of them migrated to the
    systems of Arbros's upstream providers.[^20] Moreover, Arbros's
    customers claim to have suffered damage due to the discontinuance by
    loss of clients, reduction in cash flow, increase in administrative
    costs and support time, lack of communications, with their branch
    offices, and the need to travel to branch offices or hire couriers
    to communicate with branch offices.[^21] Such problems underscore
    the need to strictly enforce section 214 and our rules regarding
    notice and prior authorization of discontinuances here.

8.  Under the Act and our rules, it is clear that a telecommunications
    carrier must receive Commission authorization and provide the
    required notice to its customers before it may discontinue
    interstate service to those customers.[^22] Here, however, Arbros
    apparently claims that a timely request for authorization and the
    required notice to its customers was not possible because its
    upstream providers abruptly terminated service to Arbros and thereby
    caused the discontinuance of service to Arbros's end-user
    customers.[^23] We find that the record does not support Arbros's
    claim. The company states that it decided in the fall of 2001,
    months before the actual discontinuances, that it would cease
    providing resale service.[^24] Therefore, Arbros had ample time
    after its decision to leave the market to file an application for
    discontinuance and provide notice to its customers. Arbros claims
    that it was not at fault for the unauthorized discontinuance because
    its suppliers cut off service. The record shows, however, that the
    suppliers who cut off service did so because Arbros failed to pay
    its bills. Thus, it appears that Arbros ultimately was at fault for
    the service cut-off. To the extent that Arbros may have disputed the
    amounts owed to its suppliers, there is no evidence in the record
    that Arbros ever attempted to pay its providers any disputed
    amounts, subject to later determination, to permit it to avoid
    premature discontinuance. Moreover, Arbros\'s claim that it
    discontinued only because its suppliers cut off service has been
    contradicted.[^25] We conclude that Arbros, not its upstream
    providers, was apparently responsible for the unauthorized
    discontinuance here.

9.  In attempting to excuse its lapses, Arbros also relies on the
    contention that some customers were able to avoid the loss of
    service by obtaining service from other carriers, including Arbros's
    upstream providers. While the issue of whether customers would be
    able to receive substitute service from another provider is relevant
    to the Commission's review of an application for
    discontinuance,[^26] the ability of customers to receive substitute
    service is not a defense when a carrier has discontinued service
    without authorization. In any event, the record establishes that
    Arbros's actions to migrate these customers to other carriers were
    ineffective. Only 40 of Arbros's 306 customers were switched to its
    upstream providers, and several of the customers providing
    declarations have stated that Arbros was impossible to reach or gave
    the customer incorrect information, and that they were without
    service for up to seven weeks.[^27] In view of the foregoing facts,
    it appears that Arbros willfully or repeatedly discontinued service
    without Commission authorization in violation of section 214(a) of
    the Act and sections 63.61, 63.71, and 63.505 of the Commission's
    rules.

    .

##  B. Forfeiture Amount {#b.-forfeiture-amount .unnumbered}

10. The forfeiture guidelines establish a base forfeiture amount of
    \$5000 per violation for unauthorized discontinuance of service to a
    community.[^28] Arbros discontinued exchange access service in nine
    states and all of its interstate long distance service. As we have
    done previously in this context, we will treat Arbros's
    discontinuance of exchange access service in each state as
    discontinuance to a community, and we will treat its discontinuance
    of interstate long distance service as an additional discontinuance
    of service to a community.[^29] Because there were ten violations,
    *i.e.*, unauthorized discontinuances of long distance service and of
    exchange access service in these nine communities, this results in a
    total proposed forfeiture of \$50,000.

#  III. conclusion and ordering clauses {#iii.-conclusion-and-ordering-clauses .unnumbered}

11. We have determined that Arbros apparently committed ten separate
    violations of section 214(a) of the Communications Act and sections
    63.61, 63.71, and 63.505 of the Commission's rules by discontinuing
    service without Commission authorization, as described above. We
    have further determined that Arbros is apparently liable in the
    amount of \$5000 for each of the violations of section 214 of the
    Act and sections 63.61, 63.71, and 63.505 of the Commission's rules.

12. Accordingly, IT IS ORDERED, pursuant to section 503(b) of the
    Communications Act of 1934, as amended, 47 U.S.C. § 503(b), section
    1.80 of the Commission's rules, 47 C.F.R. § 1.80, and authority
    delegated by sections 0.111 and 0.311 of the Commission's rules, 47
    C.F.R. §§0.111, 0.311, that Arbros Communications, Inc. IS HEREBY
    NOTIFIED of an Apparent Liability for Forfeiture in the amount of
    \$50,000 for willful or repeated violations of section 214(a) of the
    Act[^30] and sections 63.61, 63.71, and 63.505 as described in the
    paragraphs above.[^31]

13. 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 of Apparent Liability, Arbros Communications, Inc.
    SHALL PAY the full amount of the proposed forfeiture[^32] OR SHALL
    FILE a response showing why the proposed forfeiture should not be
    imposed or should be reduced.

14. 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 ("GAAP"); 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.

15. Requests for payment of the full amount of this Notice of Apparent
    Liability under an installment plan should be sent to: Chief,
    Revenue and Receivables Operations Group, 445 12th Street, S.W.,
    Washington, D.C. 20554[^33][^34]

16. Under the Small Business Paperwork Relief Act of 2002, Pub L. No.
    107-198, 116 Stat. 729 (June 28, 2002), the FCC is engaged in a
    two-year tracking process regarding the size of entities involved in
    forfeitures. If you qualify as a small entity and if you wish to be
    treated as a small entity for tracking purposes, please so certify
    to us within thirty (30) days of this NAL, either in your response
    to the NAL or in a separate filing to be sent to the
    Telecommunications Consumers Division. Your certification should
    indicate whether you, including your parent entity and its
    subsidiaries, meet one of the definitions set forth in the list
    provided by the FCC's Office of Communications Business
    Opportunities (OCBO) set forth in Attachment A of this Notice of
    Apparent Liability. This information will be used for tracking
    purposes only. Your response or failure to respond to this question
    will have no effect on your rights and responsibilities pursuant to
    Section 503(b) of the Communications Act. If you have questions
    regarding any of the information contained in Attachment A, please
    contact OCBO at (202) 418-0990.

17. IT IS FURTHER ORDERED that copies of this Notice of Apparent
    Liability for Forfeiture SHALL BE SENT by certified mail to E.
    Ashton Johnston, Esq., Piper Rudnick, 1200 Nineteenth Street, N.W.,
    Washington, D.C. 20036-2412; and to John Balestrieri, President,
    Arbros Communications, Inc., 880 Eldridge Landing Road, Linthicum,
    MD 21090.

> FEDERAL COMMUNICATIONS COMMISSION
>
> David H. Solomon
>
> Chief, Enforcement Bureau

**ATTACHMENT A**

+--------------------------------+-------------------------------------+
| **FCC List of Small Entities** |                                     |
|                                |                                     |
| **As described below, a "small |                                     |
| entity" may be a small         |                                     |
| organization,**                |                                     |
|                                |                                     |
| **a small governmental         |                                     |
| jurisdiction, or a small       |                                     |
| business.**                    |                                     |
+--------------------------------+-------------------------------------+
| **(1) Small Organization**     |                                     |
+--------------------------------+-------------------------------------+
| **Any not-for-profit           |                                     |
| enterprise that is             |                                     |
| independently owned and        |                                     |
| operated and**                 |                                     |
|                                |                                     |
| **is not dominant in its       |                                     |
| field.**                       |                                     |
+--------------------------------+-------------------------------------+
| **(2) Small Governmental       |                                     |
| Jurisdiction**                 |                                     |
+--------------------------------+-------------------------------------+
| **Governments of cities,       |                                     |
| counties, towns, townships,    |                                     |
| villages, school districts,    |                                     |
| or**                           |                                     |
|                                |                                     |
| **special districts, with a    |                                     |
| population of less than fifty  |                                     |
| thousand.**                    |                                     |
+--------------------------------+-------------------------------------+
| **(3) Small Business**         |                                     |
+--------------------------------+-------------------------------------+
| **Any business concern that is |                                     |
| independently owned and        |                                     |
| operated and**                 |                                     |
|                                |                                     |
| **is not dominant in its       |                                     |
| field, *and* meets the         |                                     |
| pertinent size criterion       |                                     |
| described below.**             |                                     |
+--------------------------------+-------------------------------------+
| **Industry Type**              | **Description of Small Business     |
|                                | Size Standards**                    |
+--------------------------------+-------------------------------------+
| ***Cable Services or           |                                     |
| Systems***                     |                                     |
+--------------------------------+-------------------------------------+
| Cable Systems                  | Special Size Standard --            |
|                                |                                     |
|                                | **Small Cable Company** has 400,000 |
|                                | Subscribers Nationwide or Fewer     |
+--------------------------------+-------------------------------------+
| Cable and Other Program        | \$12.5 Million in Annual Receipts   |
| Distribution                   | or Less                             |
+--------------------------------+-------------------------------------+
| Open Video Systems             |                                     |
+--------------------------------+-------------------------------------+
| ***Common Carrier Services and |                                     |
| Related Entities***            |                                     |
+--------------------------------+-------------------------------------+
| Wireline Carriers and Service  | 1,500 Employees or Fewer            |
| providers                      |                                     |
+--------------------------------+-------------------------------------+
| Local Exchange Carriers,       |                                     |
| Competitive Access Providers,  |                                     |
| Interexchange Carriers,        |                                     |
| Operator Service Providers,    |                                     |
| Payphone Providers, and        |                                     |
| Resellers                      |                                     |
+--------------------------------+-------------------------------------+
| **Note:** With the exception   |                                     |
| of Cable Systems, all size     |                                     |
| standards are expressed in     |                                     |
| either millions of dollars or  |                                     |
| number of employees and are    |                                     |
| generally the average annual   |                                     |
| receipts or the average        |                                     |
| employment of a firm.          |                                     |
| Directions for calculating     |                                     |
| average annual receipts and    |                                     |
| average employment of a firm   |                                     |
| can be found in                |                                     |
|                                |                                     |
| 13 CFR 121.104 and 13 CFR      |                                     |
| 121.106, respectively.         |                                     |
+--------------------------------+-------------------------------------+
| ***International Services***   |                                     |
+--------------------------------+-------------------------------------+
| International Broadcast        | \$12.5 Million in Annual Receipts   |
| Stations                       | or Less                             |
+--------------------------------+-------------------------------------+
| International Public Fixed     |                                     |
| Radio (Public and Control      |                                     |
| Stations)                      |                                     |
+--------------------------------+-------------------------------------+
| Fixed Satellite                |                                     |
| Transmit/Receive Earth         |                                     |
| Stations                       |                                     |
+--------------------------------+-------------------------------------+
| Fixed Satellite Very Small     |                                     |
| Aperture Terminal Systems      |                                     |
+--------------------------------+-------------------------------------+
| Mobile Satellite Earth         |                                     |
| Stations                       |                                     |
+--------------------------------+-------------------------------------+
| Radio Determination Satellite  |                                     |
| Earth Stations                 |                                     |
+--------------------------------+-------------------------------------+
| Geostationary Space Stations   |                                     |
+--------------------------------+-------------------------------------+
| Non-Geostationary Space        |                                     |
| Stations                       |                                     |
+--------------------------------+-------------------------------------+
| Direct Broadcast Satellites    |                                     |
+--------------------------------+-------------------------------------+
| Home Satellite Dish Service    |                                     |
+--------------------------------+-------------------------------------+
| ***Mass Media Services***      |                                     |
+--------------------------------+-------------------------------------+
| Television Services            | \$12 Million in Annual Receipts or  |
|                                | Less                                |
+--------------------------------+-------------------------------------+
| Low Power Television Services  |                                     |
| and Television Translator      |                                     |
| Stations                       |                                     |
+--------------------------------+-------------------------------------+
| TV Auxiliary, Special          |                                     |
| Broadcast and Other Program    |                                     |
| Distribution Services          |                                     |
+--------------------------------+-------------------------------------+
| Radio Services                 | \$6 Million in Annual Receipts or   |
|                                | Less                                |
+--------------------------------+-------------------------------------+
| Radio Auxiliary, Special       |                                     |
| Broadcast and Other Program    |                                     |
| Distribution Services          |                                     |
+--------------------------------+-------------------------------------+
| Multipoint Distribution        | Auction Special Size Standard --    |
| Service                        |                                     |
|                                | **Small Business** is less than     |
|                                | \$40M in annual gross revenues for  |
|                                | three preceding years               |
+--------------------------------+-------------------------------------+
| ***Wireless and Commercial     |                                     |
| Mobile Services***             |                                     |
+--------------------------------+-------------------------------------+
| Cellular Licensees             | 1,500 Employees or Fewer            |
+--------------------------------+-------------------------------------+
| 220 MHz Radio Service -- Phase |                                     |
| I Licensees                    |                                     |
+--------------------------------+-------------------------------------+
| 220 MHz Radio Service -- Phase | Auction special size standard -     |
| II Licensees                   |                                     |
|                                | **Small Business** is average gross |
|                                | revenues of \$15M or less for the   |
|                                | preceding three years (includes     |
|                                | affiliates and controlling          |
|                                | principals)                         |
|                                |                                     |
|                                | **Very Small Business** is average  |
|                                | gross revenues of \$3M or less for  |
|                                | the preceding three years (includes |
|                                | affiliates and controlling          |
|                                | principals)                         |
+--------------------------------+-------------------------------------+
| 700 MHZ Guard Band Licensees   |                                     |
+--------------------------------+-------------------------------------+
| Private and Common Carrier     |                                     |
| Paging                         |                                     |
+--------------------------------+-------------------------------------+
| Broadband Personal             | 1,500 Employees or Fewer            |
| Communications Services        |                                     |
| (Blocks A, B, D, and E)        |                                     |
+--------------------------------+-------------------------------------+
| Broadband Personal             | Auction special size standard -     |
| Communications Services (Block |                                     |
| C)                             | **Small Business** is \$40M or less |
|                                | in annual gross revenues for three  |
|                                | previous calendar years             |
|                                |                                     |
|                                | **Very Small Business** is average  |
|                                | gross revenues of \$15M or less for |
|                                | the preceding three calendar years  |
|                                | (includes affiliates and persons or |
|                                | entities that hold interest in such |
|                                | entity and their affiliates)        |
+--------------------------------+-------------------------------------+
| Broadband Personal             |                                     |
| Communications Services (Block |                                     |
| F)                             |                                     |
+--------------------------------+-------------------------------------+
| Narrowband Personal            |                                     |
| Communications Services        |                                     |
+--------------------------------+-------------------------------------+
| Rural Radiotelephone Service   | 1,500 Employees or Fewer            |
+--------------------------------+-------------------------------------+
| Air-Ground Radiotelephone      |                                     |
| Service                        |                                     |
+--------------------------------+-------------------------------------+
| 800 MHz Specialized Mobile     | Auction special size standard -     |
| Radio                          |                                     |
|                                | **Small Business** is \$15M or less |
|                                | average annual gross revenues for   |
|                                | three preceding calendar years      |
+--------------------------------+-------------------------------------+
| 900 MHz Specialized Mobile     |                                     |
| Radio                          |                                     |
+--------------------------------+-------------------------------------+
| Private Land Mobile Radio      | 1,500 Employees or Fewer            |
+--------------------------------+-------------------------------------+
| Amateur Radio Service          | N/A                                 |
+--------------------------------+-------------------------------------+
| Aviation and Marine Radio      | 1,500 Employees or Fewer            |
| Service                        |                                     |
+--------------------------------+-------------------------------------+
| Fixed Microwave Services       |                                     |
+--------------------------------+-------------------------------------+
| Public Safety Radio Services   | **Small Business** is 1,500         |
|                                | employees or less                   |
|                                |                                     |
|                                | **Small Government Entities** has   |
|                                | population of less than 50,000      |
|                                | persons                             |
+--------------------------------+-------------------------------------+
| Wireless Telephony and Paging  | 1,500 Employees or Fewer            |
| and Messaging                  |                                     |
+--------------------------------+-------------------------------------+
| Personal Radio Services        | N/A                                 |
+--------------------------------+-------------------------------------+
| Offshore Radiotelephone        | 1,500 Employees or Fewer            |
| Service                        |                                     |
+--------------------------------+-------------------------------------+
| Wireless Communications        | **Small Business** is \$40M or less |
| Services                       | average annual gross revenues for   |
|                                | three preceding years               |
|                                |                                     |
|                                | **Very Small Business** is average  |
|                                | gross revenues of \$15M or less for |
|                                | the preceding three years           |
+--------------------------------+-------------------------------------+
| 39 GHz Service                 |                                     |
+--------------------------------+-------------------------------------+
| Multipoint Distribution        | Auction special size standard       |
| Service                        | (1996) --                           |
|                                |                                     |
|                                | **Small Business** is \$40M or less |
|                                | average annual gross revenues for   |
|                                | three preceding calendar years      |
|                                |                                     |
|                                | Prior to Auction --                 |
|                                |                                     |
|                                | **Small Business** has annual       |
|                                | revenue of \$12.5M or less          |
+--------------------------------+-------------------------------------+
| Multichannel Multipoint        | \$12.5 Million in Annual Receipts   |
| Distribution Service           | or Less                             |
+--------------------------------+-------------------------------------+
| Instructional Television Fixed |                                     |
| Service                        |                                     |
+--------------------------------+-------------------------------------+
| Local Multipoint Distribution  | Auction special size standard       |
| Service                        | (1998) --                           |
|                                |                                     |
|                                | **Small Business** is \$40M or less |
|                                | average annual gross revenues for   |
|                                | three preceding years               |
|                                |                                     |
|                                | **Very Small Business** is average  |
|                                | gross revenues of \$15M or less for |
|                                | the preceding three years           |
+--------------------------------+-------------------------------------+
| 218-219 MHZ Service            | First Auction special size standard |
|                                | (1994) --                           |
|                                |                                     |
|                                | **Small Business** is an entity     |
|                                | that, together with its affiliates, |
|                                | has no more than a \$6M net worth   |
|                                | and, after federal income taxes     |
|                                | (excluding carryover losses) has no |
|                                | more than \$2M in annual profits    |
|                                | each year for the previous two      |
|                                | years                               |
|                                |                                     |
|                                | New Standard --                     |
|                                |                                     |
|                                | **Small Business** is average gross |
|                                | revenues of \$15M or less for the   |
|                                | preceding three years (includes     |
|                                | affil iates and persons or entities |
|                                | that hold interest in such entity   |
|                                | and their affiliates)               |
|                                |                                     |
|                                | **Very Small Business** is average  |
|                                | gross revenues of \$3M or less for  |
|                                | the preceding three years (includes |
|                                | affiliates and persons or entities  |
|                                | that hold interest in such entity   |
|                                | and their affiliates)               |
+--------------------------------+-------------------------------------+
| Satellite Master Antenna       | \$12.5 Million in Annual Receipts   |
| Television Systems             | or Less                             |
+--------------------------------+-------------------------------------+
| 24 GHz -- Incumbent Licensees  | 1,500 Employees or Fewer            |
+--------------------------------+-------------------------------------+
| 24 GHz -- Future Licensees     | **Small Business** is average gross |
|                                | revenues of \$15M or less for the   |
|                                | preceding three years (includes     |
|                                | affiliates and persons or entities  |
|                                | that hold interest in such entity   |
|                                | and their affiliates)               |
|                                |                                     |
|                                | **Very Small Business** is average  |
|                                | gross revenues of \$3M or less for  |
|                                | the preceding three years (includes |
|                                | affiliates and persons or entities  |
|                                | that hold interest in such entity   |
|                                | and their affiliates)               |
+--------------------------------+-------------------------------------+
| ***Miscellaneous***            |                                     |
+--------------------------------+-------------------------------------+
| On-Line Information Services   | \$18 Million in Annual Receipts or  |
|                                | Less                                |
+--------------------------------+-------------------------------------+
| Radio and Television           | 750 Employees or Fewer              |
| Broadcasting and Wireless      |                                     |
| Communications Equipment       |                                     |
| Manufacturers                  |                                     |
+--------------------------------+-------------------------------------+
| Audio and Video Equipment      |                                     |
| Manufacturers                  |                                     |
+--------------------------------+-------------------------------------+
| Telephone Apparatus            | 1,000 Employees or Fewer            |
| Manufacturers (Except          |                                     |
| Cellular)                      |                                     |
+--------------------------------+-------------------------------------+
| Medical Implant Device         | 500 Employees or Fewer              |
| Manufacturers                  |                                     |
+--------------------------------+-------------------------------------+
| Hospitals                      | \$29 Million in Annual Receipts or  |
|                                | Less                                |
+--------------------------------+-------------------------------------+
| Nursing Homes                  | \$11.5 Million in Annual Receipts   |
|                                | or Less                             |
+--------------------------------+-------------------------------------+
| Hotels and Motels              | \$6 Million in Annual Receipts or   |
|                                | Less                                |
+--------------------------------+-------------------------------------+
| Tower Owners                   | (See Lessee's Type of Business)     |
+--------------------------------+-------------------------------------+

[^1]: *See* 47 U.S.C. § 503(b)(4)(A). The Commission has authority under
    this section of the Act to assess a forfeiture penalty against a
    common carrier if the Commission determines that the carrier has
    "willfully or repeatedly" failed to comply with the provisions of
    the Act or with any rule, regulation, or order issued by the
    Commission under the Act. The section provides that the Commission
    must assess such penalties through the use of a written notice of
    apparent liability or notice of opportunity for hearing.

[^2]: Arbros is a Delaware Corporation. It appears that it is held by
    Arcomm Holding Company (Arcomm). A majority of Arcomm's shares are
    owned by Linsang Partners, LLC. Arbros has the following affiliates:
    Arbros Communications Licensing Company West, LLC; Arbros
    Communications Licensing Company Canada, LLC; Arbros Communications
    N.E. LLC and its wholly owned subsidiaries Arbros Communications
    Licensing Company, Nutel Communications, Inc. d/b/a Arbros
    Communications Licensing Company, N.E., and Arbros Communications
    Licensing Company, Virginia; Arbros Communications S.E., LLC and its
    wholly owned subsidiary Arbros Communications Licensing Company,
    S.E. LLC; Arbros Communications Central, LLC and its wholly owned
    subsidiary Arbros Communications Company Central LLC; Arbros
    Communications Texas LLC and its wholly owned subsidiary Arbros
    Communications Licensing Company Texas, LLC; Arbros Communications
    California, LLC and its wholly owned subsidiary Arbros
    Communications Licensing Company California LLC; and Comm South
    Companies, Inc. and its wholly owned subsidiaries Georgia Comm
    South, Inc., E-Z Tel, Inc., and Comm South Companies of Virginia,
    Inc. Its main office is 880 Eldridge Landing Road, Linthicum, MD
    21090. Its President is John Balestrieri. Arbros has blanket
    operating authority from the Commission under sections 63.01 and
    63.02 of the Commission's rules, 47 C.F.R. §§ 63.01, 63.02.

[^3]: 47 U.S.C. § 214(a). This section provides in pertinent part that
    "\[n\]o carrier shall discontinue, reduce, or impair service to a
    community, or part of a community, unless there shall first have
    been obtained from the Commission a certificate that neither the
    present nor future public convenience and necessity will be
    adversely affected thereby; except that the Commission may, upon
    appropriate request being made, authorize temporary or emergency
    discontinuance, reduction, or impairment of service, or partial
    discontinuance, reduction, or impairment of service...."

[^4]: 47 C.F.R. §§ 63.61, 63.71, 63.505.

[^5]: Letter dated September 5, 2002, from E. Ashton Johnston, counsel
    for Arbros, to Peter G. Wolfe, FCC ("Arbros Letter").

[^6]: Public Notice, "Comments Invited on Arbros Communications, Inc.
    and its Subsidiaries Joint Application to Discontinue Domestic
    Telecommunications Services," DA 02-571 (Mar. 7, 2002).

[^7]: Declaration of Karl Fischer on behalf of Traffic Planning & Design
    (Sept. 4, 2002)("Fischer Declaration"); Declaration of Charles
    Tassin on behalf of Career Transition Center (Aug. 29, 2002)
    ("Tassin Declaration"); Declaration of Jim Smith on behalf of
    Conard-Pyles Company (August 28, 2002)("Smith Declaration").

[^8]: ^?^ Arbros Letter.

[^9]: Because we only rely on the non-confidential material in Arbros's
    response, we do not rule on Arbros's request for confidentiality.

[^10]: Arbros Letter*.*

[^11]: *Id.*

[^12]: Letters from upstream providers to Peter G. Wolfe, FCC (Aug. 7
    and 20, 2002) ("Upstream Provider Letters").

[^13]: ^?^ Declaration of Don Schindhelm on behalf of Applied
    Information Technologies (Sept. 4, 2002)(Schindhelm Declaration);
    Fischer Declaration; Tassin Declaration; Declaration of Rob Edwards
    on behalf of Royall & Company (Aug. 27, 2002)(Edwards Declaration);
    Smith Declaration.

[^14]: ^?^ Edwards Declaration; Smith Declaration.

[^15]: ^?^ Schindhelm Declaration; Fischer Declaration; Tassin
    Declaration; Smith Declaration.

[^16]: ^?^ Schindhelm Declaration; Fischer Declaration; Tassin
    Declaration; Smith Declaration.

[^17]: ^?^ Letter from upstream provider to Peter G. Wolfe (Aug. 20,
    2002).

[^18]: *See Implementation of Section 402(b)(2)(A) of the
    Telecommunications Act of 1996 and Petition for Forbearance of the
    Independent Telephone & Telecommunications Alliance*, Report and
    Order in CC Docket No. 97-11 and Second Memorandum Opinion and Order
    in AAD File No. 98-43, 14 FCC Rcd 11364, 11380-81 (1999).

[^19]: Edwards Declaration; Smith Declaration.

[^20]: Upstream provider letters.

[^21]: Schindhelm Declaration; Fischer Declaration; Tassin Declaration;
    Smith Declaration.

[^22]: 47 U.S.C. § 214(a); 47 C.F.R. §§ 63.61, 63.71, 63.505.

[^23]: Arbros Letter.

[^24]: *Id.*

[^25]: Letter from Upstream Provider to Peter G. Wolfe (Aug. 20, 2002).

[^26]: *See* 47 C.F.R. §63.71(a)(5).

[^27]: Upstream Provider Letters; Schindhelm Declaration; Fischer
    Declaration; Tassin Declaration; Smith Declaration.

[^28]: 47 C.F.R. § 1.80.

[^29]: *See BroadStreet Communications, Inc.*, 17 FCC Rcd at 7938, 1739
    (EB, 2002).

[^30]: 47 U.S.C. § 214(a).

[^31]: 47 C.F.R. §§ 63.61, 63.71, 63.505.

[^32]: 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 Arbros Communications, Inc.'s check or
    money order to "NAL/Acct. No. 200332170001." Such remittances must
    be mailed to Forfeiture Collection section, Finance Branch, federal
    Communications Commission, P.O. Box 73482, Chicago, Illinois
    60673-7482.

[^33]: ^.^

[^34]: 47 C.F.R. § 1.1914.