DATE:	March 1, 2007
TO:	Director, Division of the Commission Clerk & Administrative Services (Bayó)
FROM:	Division of Competitive Markets & Enforcement (Curry) Office of the General Counsel (Tan)
RE:	Docket No. 070050-TI – Compliance investigation of NETECOM, Inc. for apparent violation of Rule 25-24.470, F.A.C., Registration Required
AGENDA:	03/13/07 – Regular Agenda – Proposed Agency Action – Interested Persons May Participate
COMMISSIONERS ASSIGNED:			All Commissioners
PREHEARING OFFICER:			Administrative
CRITICAL DATES:			None
SPECIAL INSTRUCTIONS:			None
FILE NAME AND LOCATION:			S:\PSC\CMP\WP\070050.RCM.DOC

 

 Case Background

On October 13, 2006, staff received a customer complaint against NETECOM, Inc. (NETECOM) regarding an unauthorized switch of long distance services.  According to the customer’s complaint, NETECOM switched the customer’s long distance services without permission and continued to bill the customer after the customer switched backed to his preferred provider.  After receiving the complaint, staff determined that NETECOM was not registered and had not filed a tariff with the Commission.  Staff sent two certified letters to the company.  Copies of the letters were also sent to the company via facsimile.  NETECOM signed the return receipt card for each of the certified letters and the facsimile transmittal form also indicated that the letters were successfully faxed to the company.  However, the company never responded. 

The Commission is vested with jurisdiction over these matters pursuant to Sections 364.02, 364.04, and 364.285, Florida Statutes.  Accordingly, staff believes the following recommendations are appropriate.

 

Discussion of Issues

Issue 1: 

 Should the Commission impose a penalty in the amount of $25,000 upon NETECOM, Inc. for its apparent violation of Rule 25-24.470, F.A.C., Registration Required, to be paid to the Florida Public Service Commission within fourteen calendar days after the issuance of the Consummating Order?

Recommendation: 

 Yes, the Commission should impose a penalty in the amount of $25,000 upon NETECOM, Inc. for its apparent violation of Rule 25-24.470, F.A.C., Registration Required, to be paid to the Florida Public Service Commission within fourteen calendar days after the issuance of the Consummating Order.    (Curry, Tan)

Staff Analysis: 

 Rule 25-24.470, Florida Administrative Code, Registration Required, states:

No person shall provide intrastate interexchange telephone service without first filing an initial tariff containing the rates, terms, and conditions of service and providing the company’s current contact information with the Division of the Commission Clerk and Administrative Services.

 

            As stated in the case background, staff made several attempts to contact the company via certified letter and facsimile.  Each letter requested that the company resolve the customer complaint and provide staff with a copy of the letter of authorization (LOA) or third party verification (TPV) wherein the customer authorized the company to provide service.  The letters also requested that the company register as an intrastate interexchange company (IXC) and file a tariff with the Commission.   As of the date of filing this recommendation, NETECOM has not resolved the customer complaint, registered as an intrastate interexchange company, or provided staff with any of the requested information.  Since NETECOM never provided staff with a copy of the LOA or TPV, staff was unable to determine if the company operated in apparent violation of Rule 24-4.118, F.A.C.  However, staff did determine that NETECOM was operating in apparent violation of Rule 25-24.470, Florida Administrative Code, Registration Required. 

            Staff believes that NETECOM’s failure to register and file a tariff with the Commission is a "willful violation" of Rule 25-24.470, Florida Administrative Code, Registration Required, in the sense intended by Section 364.285, Florida Statutes.

 

Pursuant to Section 364.285(1), Florida Statutes, the Commission is authorized to impose upon any entity subject to its jurisdiction a penalty of not more than $25,000 for each day a violation continues, if such entity is found to have refused to comply with or to have willfully violated any lawful rule or order of the Commission, or any provision of Chapter 364, Florida Statutes, or revoke any certificate issued by it for any such violation.

 

            Section 364.285(1), Florida Statutes, however, does not define what it is to “willfully violate” a rule or order.  Nevertheless, it appears plain that the intent of the statutory language is to penalize those who affirmatively act in opposition to a Commission order or rule. See, Florida State Racing Commission v. Ponce de Leon Trotting Association, 151 So.2d 633, 634 & n.4 (Fla. 1963); c.f., McKenzie Tank Lines, Inc. v. McCauley, 418 So.2d 1177, 1181 (Fla. 1^st DCA 1982) (there must be an intentional commission of an act violative of a statute with knowledge that such an act is likely to result in serious injury) [citing Smit v. Geyer Detective Agency, Inc., 130 So.2d 882, 884 (Fla. 1961)].  Thus, a “willful violation of law” at least covers an act of purposefulness.

 

            However, “willful violation” need not be limited to acts of commission.  The phrase "willful violation" can mean either an intentional act of commission or one of omission, that is failing to act.  See, Nuger v. State Insurance Commissioner, 238 Md. 55, 67, 207 A.2d 619, 625 (1965)[emphasis added].  As the First District Court of Appeal stated, “willfully” can be defined as:

 

An act or omission is 'willfully' done, if done voluntarily and intentionally and with the specific intent to do something the law forbids, or with the specific intent to fail to do something the law requires to be done;  that is to say, with bad purpose either to disobey or to disregard the law.

 

Metropolitan Dade County v. State Department of Environmental Protection, 714 So.2d 512, 517 (Fla. 1^st DCA 1998)[emphasis added]. In other words, a willful violation of a statute, rule or order is also one done with an intentional disregard of, or a plain indifference to, the applicable statute or regulation.  See, L. R. Willson & Sons, Inc. v. Donovan, 685 F.2d 664, 667 n.1 (D.C. Cir. 1982).

 

            Thus, NETECOM’s failure to register and file a tariff with the Commission meets the standard for a “refusal to comply” and a "willful violation" as contemplated by the Legislature when enacting section 364.285, Florida Statutes.

 

 “It is a common maxim, familiar to all minds, that 'ignorance of the law' will not excuse any person, either civilly or criminally."  Barlow v. United States, 32 U.S. 404, 411 (1833); see, Perez v. Marti, 770 So.2d 284, 289 (Fla. 3^rd DCA 2000) (ignorance of the law is never a defense).  Moreover, in the context of this docket, all telecommunication companies, like NETECOM, by virtue of their IXC registration, are subject to the rules published in the Florida Administrative Code.  See, Commercial Ventures, Inc. v. Beard, 595 So.2d 47, 48 (Fla. 1992).

 

            Further, the amount of the proposed penalty is consistent with penalties previously imposed by the Commission upon intrastate interexchange telecommunications companies that were providing intrastate interexchange services within the state that failed to register and to file a tariff with the Commission.   Therefore, staff recommends that the Commission impose a penalty upon NETECOM in the amount of $25,000 for the company’s apparent violation of Rule 25-24.470, F.A.C.

Issue 2: 

 Should this docket be closed?

Recommendation: 

 The Order issued from this recommendation will become final and effective upon issuance of a Consummating Order, unless a person whose substantial interests are affected by the Commission’s decision files a protest that identifies with specificity the issues in dispute, in the form provided by Rule 28-106.201, Florida Administrative Code, within 21 days of the issuance of the Proposed Agency Action Order.  As provided by Section 120.80(13) (b), Florida Statutes, any issues not in dispute should be deemed stipulated.  If NETECOM fails to timely file a protest and request a Section 120.57, Florida Statutes, hearing, the facts should be deemed admitted, the right to a hearing waived, and the penalty should be deemed assessed.  If payment of the penalty is not received within fourteen (14) calendar days after the issuance of the Consummating Order the penalty should be referred to the Department of Financial Services for collection and the company should be required to immediately cease and desist providing intrastate interexchange telecommunications services in Florida.  This docket should be closed administratively upon receipt of the company’s current contact information, tariff, and payment of the penalty, or upon the referral of the penalty to the Department of Financial                                                                             Services.   (Tan)

Staff Analysis: 

 Staff recommends that the Commission take action as set forth in the above staff recommendation.