[Federal Register Volume 73, Number 167 (Wednesday, August 27, 2008)]
[Notices]
[Pages 50622-50625]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E8-19878]


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FEDERAL COMMUNICATIONS COMMISSION

[DA 08-1863]


Notice of Debarment; Schools and Libraries Universal Service 
Support Mechanism

AGENCY: Federal Communications Commission.

ACTION: Notice.

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SUMMARY: The Enforcement Bureau (the ``Bureau'') debars Mr. Earl Nelson 
from the schools and libraries universal service support mechanism (or 
``E-Rate Program'') for a period of three years based on his conviction 
of collusion and aiding and abetting in connection with his 
participation in the program. The Bureau takes this action to protect 
the E-Rate Program from waste, fraud, and abuse.

DATES: Debarment commences on the date Mr. Earl Nelson receives the 
debarment letter or August 27, 2008, whichever date come first, for a 
period of three years.

FOR FURTHER INFORMATION CONTACT: Rebekah Bina, Federal Communications 
Commission, Enforcement Bureau, Investigations and Hearings Division, 
Room 4-C330, 445 12th Street, SW., Washington, DC 20554. Rebekah Bina 
may be contacted by phone at (202) 418-7931 or e-mail at 
[email protected]. If Ms. Bina is unavailable, you may contact Ms. 
Vickie Robinson, Assistant Chief, Investigations and Hearings Division, 
by

[[Page 50623]]

telephone at (202) 418-1420 and by e-mail at [email protected].

SUPPLEMENTARY INFORMATION: The Bureau debarred Mr. Earl Nelson from the 
schools and libraries universal service support mechanism for a period 
of three years pursuant to 47 CFR 54.8 and 47 CFR 0.111. Attached is 
the debarment letter, DA 08-1863, which was mailed to Mr. Earl Nelson 
and released on August 7, 2008. The complete text of the notice of 
debarment is available for public inspection and copying during regular 
business hours at the FCC Reference Information Center, Portal II, 445 
12th Street, SW., Room CY-A257, Washington, DC 20554. In addition, the 
complete text is available on the FCC's Web site at http://www.fcc.gov. 
The text may also be purchased from the Commission's duplicating 
inspection and copying service during regular business hours at the 
contractor, Best Copy and Printing, Inc., Portal II, 445 12th Street, 
SW., Room CY-B420, Washington, DC 20554, telephone (202) 488-5300 or 
(800) 378-3160, facsimile (202) 488-5563, or via e-mail http://www.bcpiweb.com.

    Federal Communications Commission.
Vickie Robinson,
Assistant Chief, Investigations and Hearings Division, Enforcement 
Bureau.
    The debarment letter, which attached the suspension letter, 
follows:
August 7, 2008
DA 08-1863

VIA CERTIFIED MAIL

RETURN RECEIPT REQUESTED AND FACSIMILE (415-621-4111)

Mr. Earl Nelson
c/o Richard B. Mazer, Esq.
Law Offices of Richard Mazer
99 Divisadero Street
San Francisco, CA 94117
Re: Notice of Debarment, File No. EB-08-IH-1138
    Dear Mr. Nelson:
    Pursuant to section 54.8 of the rules of the Federal Communications 
Commission (the ``Commission''), by this Notice of Debarment you are 
debarred from the schools and libraries universal service support 
mechanism (or ``E-Rate program'') for a period of three years.\1\
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    \1\ See 47 CFR 0.111(a), 54.8.
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    On May 19, 2008, the Enforcement Bureau (the ``Bureau'') sent you a 
Notice of Suspension and Initiation of Debarment Proceedings (the 
``Notice of Suspension'').\2\ That Notice of Suspension was published 
in the Federal Register on June 9, 2008.\3\ The Notice of Suspension 
suspended you from the schools and libraries universal service support 
mechanism and described the basis for initiation of debarment 
proceedings against you, the applicable debarment procedures, and the 
effect of debarment.\4\
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    \2\ Letter from Hillary S. DeNigro, Chief, Investigations and 
Hearings Division, Enforcement Bureau, Federal Communications 
Commission, to Mr. Earl Nelson, Notice of Suspension and Initiation 
of Debarment Proceedings, 23 FCC Rcd 8215 (Inv. & Hearings Div., 
Enf. Bur. 2008) (Attachment 1).
    \3\ 73 FR 32581 (June 9, 2008).
    \4\ See Notice of Suspension, 23 FCC Rcd at 8216-18.
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    Pursuant to the Commission's rules, any opposition to your 
suspension or its scope or to your proposed debarment or its scope had 
to be filed with the Commission no later than thirty (30) calendar days 
from the earlier date of your receipt of the Notice of Suspension or 
publication of the Notice of Suspension in the Federal Register.\5\ The 
Commission did not receive any such opposition.
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    \5\ See 47 CFR 54.8 (e)(3) and (4). That date occurred no later 
than July 9, 2008. See supra note 3.
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    As discussed in the Notice of Suspension, you pled guilty to and 
were convicted of collusion and aiding and abetting, in violation of 15 
U.S.C. 1 and 18 U.S.C. 2, in connection with your participation in the 
E-Rate program.\6\ You admitted to entering into and engaging in a 
conspiracy to suppress and restrain competition by submitting 
collusive, noncompetitive, and rigged bids for an E-Rate project.\7\ 
Such conduct constitutes the basis for your debarment, and your 
conviction falls within the categories of causes for debarment under 
section 54.8(c) of the Commission's rules.\8\ For the foregoing 
reasons, you are hereby debarred for a period of three years from the 
debarment date, i.e., the earlier date of your receipt of this Notice 
of Debarment or its publication date in the Federal Register.\9\ 
Debarment excludes you, for the debarment period, from activities 
``associated with or related to the schools and libraries support 
mechanism,'' including ``the receipt of funds or discounted services 
through the schools and libraries support mechanism, or consulting 
with, assisting, or advising applicants or service providers regarding 
the schools and libraries support mechanism.'' \10\

    \6\ See Notice of Suspension, 23 FCC Rcd at 8215-16.
    \7\ See id. at 8216.
    \8\ 47 CFR 54.8(c).
    \9\ See 47 CFR 54.8(g). See also Notice of Suspension, 23 FCC 
Rcd at 8217.
    \10\ See 47 CFR 54.8(a)(1), 54.8(a)(5), 54.8(d); Notice of 
Suspension, 23 FCC Rcd at 8217-18.

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Sincerely,

Hillary S. DeNigro,

Chief, Investigations and Hearings Division, Enforcement Bureau.

cc: Kristy Carroll, Esq., Universal Service Administrative Company 
(via e-mail)
 Michael Wood, Antitrust Division, United States Department of 
Justice (via mail).

May 19, 2008
DA 08-1180

VIA CERTIFIED MAIL

RETURN RECEIPT REQUESTED AND FACSIMILE (415-621-4111)

Mr. Earl Nelson
c/o Richard B. Mazer, Esq.
Law Offices of Richard Mazer
99 Divisadero Street
San Francisco, CA 94117
[email protected]
Re: Notice of Suspension and Initiation of Debarment Proceedings, File 
No. EB-08-IH-1138
Dear Mr. Nelson:

    The Federal Communications Commission (``FCC'' or ``Commission'') 
has received notice of your conviction of collusion and aiding and 
abetting, in violation of 15 U.S.C. 1 and 18 U.S.C. 2, in connection 
with your participation in the schools and libraries universal service 
support mechanism (``E-Rate program'').\1\ Consequently, pursuant to 47 
CFR 54.8, this letter constitutes official notice of your suspension 
from the E-Rate program. In addition, the Enforcement Bureau 
(``Bureau'') hereby notifies you that we are commencing debarment 
proceedings against you.\2\
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    \1\ Any further reference in this letter to ``your conviction'' 
refers to your guilty plea and subsequent conviction of collusion 
and aiding and abetting. United States v. Earl Nelson, Criminal 
Docket No. 3:05-CR-00208-CRB-011, Judgment (N.D.Cal. filed and 
entered Mar. 21, 2008) (``Earl Nelson Judgment''). See United States 
v. Video Network Communications, Inc. et al., Criminal Docket No. 
3:05-CR-00208-CRB, Superseding Indictment at paras. 79-80 (N.D.Cal. 
filed Dec. 8, 2005 and entered Dec. 12, 2005); http://www.usdoj.gov/atr/cases/f213600/213626.htm (accessed May 1, 2008) (``VNCI 
Superseding Indictment'').
    \2\ 47 CFR 54.8; 47 CFR 0.111 (delegating to the Enforcement 
Bureau authority to resolve universal service suspension and 
debarment proceedings). The Commission adopted debarment rules for 
the schools and libraries universal service support mechanism in 
2003. See Schools and Libraries Universal Service Support Mechanism, 
Second Report and Order and Further Notice of Proposed Rulemaking, 
18 FCC Rcd 9202 (2003) (``Second Report and Order'') (adopting 
section 54.521 to suspend and debar parties from the E-rate 
program). In 2007, the Commission extended the debarment rules to 
apply to all of the Federal universal service support mechanisms. 
Comprehensive Review of the Universal Service Fund Management, 
Administration, and Oversight; Federal-State Joint Board on 
Universal Service; Schools and Libraries Universal Service Support 
Mechanism; Lifeline and Link Up; Changes to the Board of Directors 
for the National Exchange Carrier Association, Inc., Report and 
Order, 22 FCC Rcd 16372, 16410-12 (2007) (Program Management Order) 
(renumbering section 54.521 of the universal service debarment rules 
as section 54.8 and amending subsections (a)(1), (5), (c), (d), 
(e)(2)(i), (3), (e)(4), and (g)).

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[[Page 50624]]

I. Notice of Suspension

    The Commission has established procedures to prevent persons who 
have ``defrauded the government or engaged in similar acts through 
activities associated with or related to the schools and libraries 
support mechanism'' from receiving the benefits associated with that 
program.\3\ You pled guilty to collusion and aiding and abetting a 
scheme to defraud the E-Rate program.\4\ You admitted that, as a former 
branch manager of Inter-Tel Technologies, you entered into and engaged 
in a conspiracy with other defendants and co-conspirators to suppress 
and restrain competition by submitting collusive, noncompetitive, and 
rigged bids for an E-Rate project at the West Fresno Elementary School 
District in Fresno, California.\5\
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    \3\ See Second Report and Order, 18 FCC Rcd at 9225, para. 66; 
Program Management Order, 22 FCC Rcd at 16387, para. 32. The 
Commission's debarment rules define a ``person'' as ``[a]ny 
individual, group of individuals, corporation, partnership, 
association, unit of government or legal entity, however, 
organized.'' 47 CFR 54.8(a)(6).
    \4\ VNCI Superseding Indictment at paras. 79-80.
    \5\ See id. The Commission debarred Inter-Tel Technologies, Inc. 
in 2006 for the company's conviction for mail fraud and conspiracy 
to suppress and eliminate competition. See Inter-Tel Technologies, 
Inc., Notice to Debarment, 21 FCC Rcd 7506 (2006); 71 FR 42397 
(2006). The following four individuals, who were also charged in the 
VNCI Superseding Indictment, have pled guilty or been found guilty 
and subsequently sentenced: Judy Green, George Marchelos, William 
Holman, and Allan Green. We are sending separate notices of 
suspension and initiation of debarment proceedings to these 
individuals.
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    Pursuant to section 54.8(a)(4) of the Commission's rules,\6\ your 
conviction requires the Bureau to suspend you from participating in any 
activities associated with or related to the schools and libraries fund 
mechanism, including the receipt of funds or discounted services 
through the schools and libraries fund mechanism, or consulting with, 
assisting, or advising applicants or service providers regarding the 
schools and libraries support mechanism.\7\ Your suspension becomes 
effective upon the earlier of your receipt of this letter or 
publication of notice in the Federal Register.\8\
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    \6\ 47 CFR 54.8(a)(4). See Second Report and Order, 18 FCC Rcd 
at 9225-9227, paras. 67-74.
    \7\ 47 CFR 54.8(a)(1), (d).
    \8\ Second Report and Order, 18 FCC Rcd at 9226, para. 69; 47 
CFR 54.8(e)(1).
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    Suspension is immediate pending the Bureau's final debarment 
determination. In accordance with the Commission's debarment rules, you 
may contest this suspension or the scope of this suspension by filing 
arguments in opposition to the suspension, with any relevant 
documentation. Your request must be received within 30 days after you 
receive this letter or after notice is published in the Federal 
Register, whichever comes first.\9\ Such requests, however, will not 
ordinarily be granted.\10\ The Bureau may reverse or limit the scope of 
suspension only upon a finding of extraordinary circumstances.\11\ 
Absent extraordinary circumstances, the Bureau will decide any request 
for reversal or modification of suspension within 90 days of its 
receipt of such request.\12\
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    \9\ 47 CFR 54.8(e)(4).
    \10\ Id.
    \11\ 47 CFR 54.8(e)(5).
    \12\ See Second Report and Order, 18 FCC Rcd at 9226, para. 70; 
47 CFR 54.8(e)(5), 54.8(f).
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II. Initiation of Debarment Proceedings

    Your guilty plea and conviction of criminal conduct in connection 
with the E-Rate program, in addition to serving as a basis for 
immediate suspension from the program, also serves as a basis for the 
initiation of debarment proceedings against you. Your conviction falls 
within the categories of causes for debarment defined in section 
54.8(c) of the Commission's rules.\13\ Therefore, pursuant to section 
54.8(a)(4) of the Commission's rules, your conviction requires the 
Bureau to commence debarment proceedings against you.
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    \13\ ``Causes for suspension and debarment are the conviction of 
or civil judgment for attempt or commission of criminal fraud, 
theft, embezzlement, forgery, bribery, falsification or destruction 
of records, making false statements, receiving stolen property, 
making false claims, obstruction of justice and other fraud or 
criminal offense arising out of activities associated with or 
related to the schools and libraries support mechanism, the high-
cost support mechanism, the rural healthcare support mechanism, and 
the low-income support mechanism.'' 47 CFR 54.8(c). Such activities 
``include the receipt of funds or discounted services through [the 
Federal universal service] support mechanisms, or consulting with, 
assisting, or advising applicants or service providers regarding 
[the Federal universal service] support mechanisms.'' 47 CFR 
54.8(a)(1).
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    As with your suspension, you may contest debarment or the scope of 
the proposed debarment by filing arguments and any relevant 
documentation within 30 calendar days of the earlier of the receipt of 
this letter or of publication in the Federal Register.\14\ Absent 
extraordinary circumstances, the Bureau will debar you.\15\ Within 90 
days of receipt of any opposition to your suspension and proposed 
debarment, the Bureau, in the absence of extraordinary circumstances, 
will provide you with notice of its decision to debar.\16\ If the 
Bureau decides to debar you, its decision will become effective upon 
the earlier of your receipt of a debarment notice or publication of the 
decision in the Federal Register.\17\
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    \14\ See Second Report and Order, 18 FCC Rcd at 9226, para. 70; 
47 CFR 54.8(e)(3).
    \15\ Second Report and Order, 18 FCC Rcd at 9227, para. 74.
    \16\ See id., 18 FCC Rcd at 9226, para. 70; 47 CFR 54.8(e)(5).
    \17\ Id. The Commission may reverse a debarment, or may limit 
the scope or period of debarment upon a finding of extraordinary 
circumstances, following the filing of a petition by you or an 
interested party or upon motion by the Commission. 47 CFR 54.8(f).
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    If and when your debarment becomes effective, you will be 
prohibited from participating in activities associated with or related 
to the schools and libraries support mechanism for three years from the 
date of debarment.\18\ The Bureau may, if necessary to protect the 
public interest, extend the debarment period.\19\
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    \18\ Second Report and Order, 18 FCC Rcd at 9225, para. 67; 47 
CFR 54.8(d), 54.8(g).
    \19\ Id.
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    Please direct any response, if by messenger or hand delivery, to 
Marlene H. Dortch, Secretary, Federal Communications Commission, 236 
Massachusetts Avenue, NE., Suite 110, Washington, DC 20002, to the 
attention of Diana Lee, Attorney Advisor, Investigations and Hearings 
Division, Enforcement Bureau, Room 4-C330, with a copy to Vickie 
Robinson, Assistant Chief, Investigations and Hearings Division, 
Enforcement Bureau, Room 4-C330, Federal Communications Commission. If 
sent by commercial overnight mail (other than U.S. Postal Service 
Express Mail and Priority Mail), the response should be sent to the 
Federal Communications Commission, 9300 East Hampton Drive, Capitol 
Heights, Maryland 20743. If sent by first-class, Express, or Priority 
mail, the response should be sent to Diana Lee, Attorney Advisor, 
Investigations and Hearings Division, Enforcement Bureau, Federal 
Communications Commission, 445 12th Street, SW., Room 4-C330, 
Washington, DC 20554, with a copy to Vickie Robinson, Assistant Chief, 
Investigations and Hearings Division, Enforcement Bureau, Federal 
Communications Commission, 445 12th Street, SW., Room 4-C330, 
Washington, DC, 20554. You shall also transmit a copy of the response 
via email to

[[Page 50625]]

[email protected] and to [email protected].
    If you have any questions, please contact Ms. Lee via mail, by 
telephone at (202) 418-1420 or by e-mail at [email protected]. If Ms. 
Lee is unavailable, you may contact Ms. Vickie Robinson, Assistant 
Chief, Investigations and Hearings Division, by telephone at (202) 418-
1420 and by e-mail at [email protected].

Sincerely yours,

Hillary S. DeNigro,

Chief, Investigations and Hearings Division, Enforcement Bureau.

cc: Kristy Carroll, Esq., Universal Service Administrative Company 
(via e-mail)
 Michael Wood, Antitrust Division, United States Department of 
Justice (vial mail)

[FR Doc. E8-19878 Filed 8-26-08; 8:45 am]
BILLING CODE 6712-01-P