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US agency proposes $75,000 fine against ACR for false advertising

By IBI Magazine/Michael Verdon

The Federal Communications Commission (FCC) has issued a "Notice of Apparent Liability for Forfeiture" against ACR Electronics, and stipulated a fine of US$75,000 against the company for "willfully and repeatedly violating" several of its rules earlier this year. ACR said it will be appealing the ruling and fine.

The US federal agency said in its November 1, 2004 document that ACR had marketed its new PLB-200 personal locater beacon called the AquaFix to the trade and general public last spring and summer, without informing them that the device had not yet received FCC approval. In some of its early support materials for the new product, noted the FCC document, ACR even said that the PLB-200 was "FCC Approved" or "For Sale in the US."

According to the document, ACR told the FCC that its "PLB-200 was not promoted to the general public, but rather to industry-specific representatives and retailers who were clearly aware that the equipment was not for sale."

But the document pointed out that ACR advertised the product in 13 US trade and consumer publications prior to obtaining approval. The company also made PowerPoint presentations to several companies and national retail chains, with no mention of its non-approved status. Web sites like West Marine, BoatUS and others advertised the product as early as April. At least one site said that the product would be shipped by May 15, 2004.

The FCC said the "US$75,000 proposed forfeiture is sufficient to deter future violations."

Paul Hardin, ACR's executive vice president of sales and marketing, told IBI that ACR "never shipped one product prior to receiving FCC approval."

The company received approval for the PLB-200 on October 5, 2004.

"We made it exceedingly clear to all of our customers that we would not ship the PLB-200/-201 until it was FCC-approved," he said in an email response. "We have responded to the FCC with a coherent argument and hope that the proposal is withdrawn or the proposed amount of forfeiture amended."

Hardin added that the "proposal to fine us has absolutely no impact on ACR's ability to ship PLB-200/201 now that it is approved. Nor does it have any impact on our customer's ability to buy, market or sell the PLB-200/-201 now that we have the approval."

(7 December 2004)

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