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FCC Slaps M.C. Dean With Proposed Six-Figure Wi-Fi Fine

The FCC Monday (Nov. 2) proposed fining electrical contractor M.C. Dean $718,000 for allegedly blocking Wi-Fi connections at the Baltimore Convention Center.

"The FCC’s Enforcement Bureau investigation found that M.C. Dean, Inc., one of the nation’s largest electrical contracting companies, blocked personal mobile 'hotspots' of convention visitors and exhibitors who tried to use their own data plans to connect to the Internet rather than paying M.C. Dean substantial fees to use the company’s Wi-Fi service," the FCC said. 

The FCC said it had found that Dean blocked Wi-Fi at the center dozens of times, while charging exhibitors and individuals as much as $1,095 for access.

“Consumers are tired of being taken advantage of by hotels and convention centers that block their personal Wi-Fi connections,” said Travis LeBlanc, chief of the FCC’s Enforcement Bureau, in a statement.  “This disturbing practice must come to an end. It is patently unlawful for any company to maliciously block FCC-approved Wi-Fi connections.” 

Dean said it planned to challenge the decision, which it pointed out was a bureau decision, not the full commission, saying he was "optimistic that either the FCC or a court will reject the Enforcement Bureau’s theories and find in M.C. Dean’s favor."

"M.C. Dean, Inc. strongly disagrees with the decision by the FCC’s Enforcement Bureau to initiate enforcement action against the company for its management of the Wireless Local Area Network at the Baltimore Convention Center," the company said in a statement. "M.C. Dean acted in good faith and in compliance with applicable law by providing a safe and reliable Wi-Fi service to customers while ensuring that visitors could use their personal Wi-Fi hotspots at the Baltimore Convention Center.

"M.C. Dean believes that today’s action by the Enforcement Bureau is legally and factually flawed.  M.C. Dean is being accused of violating federal law by using Wi-Fi network management equipment, even though the FCC expressly authorized this equipment and M.C. Dean operated the equipment consistent with the FCC’s rules. As a matter of due process, the FCC is required to provide regulated parties with notice of what is required of them so they may act accordingly – notice thatthe FCC utterly failed to provide here.  While the FCC tells Congress that there is a “legitimate use” of the type of network management equipment employed by M.C. Dean, the agency refuses to provide any guidance about when and under what circumstances the use of such equipment will be deemed to violate the law.  This regulatory approach leaves regulated parties to guess about the lawful use of FCC-authorized equipment, only to be subject to an enforcement action if they guess wrong."

Public Knowledge praised the decision.

“This marks a big victory for all users of Wi-Fi, Bluetooth, and other devices that use unlicensed spectrum," the group said. "By today’s action, the FCC clarifies that any deliberate interference with Wi-Fi violates the law against deliberately jamming lawful communications."

The FCC's Enforcement Bureau was busy on the Wi-Fi front Monday, also proposing to fine Hilton Worldwide Holdings $25,000 for what it said was apparent obstruction of the FCC's investigation into whether Hilton engaged in blocking consumers Wi-Fi devices.

The FCC teamed the proposal with a request that the company immediately provide "essential" documents about its Wi-Fi management practices.

The bureau issues Hilton a letter of inquiry a year ago, and said the company has yet to produce the requested info.

Hilton countered that it had cooperated.

"We strongly disagree with the decision by the FCC Enforcement Bureau," said a Hilton Worldwide spokesperson. "Hilton supports open access to private Wi-Fi networks for our customers through their personal devices, while at the same time protecting their personal information. We have a policy in place that states our commitment to secure open access and prohibits hotels from blocking Wi-Fi, and it is repeatedly communicated to all properties. Throughout this inquiry, we have cooperated with the FCC, providing extensive background and details in a timely and efficient manner. We believe that the FCC has no basis for vastly expanding the initial inquiry based on a single complaint at a single Hilton hotel.”

In October 2014, the commission fined Marriott $600,000 for blocking Wi-Fi at its Gaylord Opryland Hotel and Convention Center in Nashville.

Contributing editor John Eggerton has been an editor and/or writer on media regulation, legislation and policy for over four decades, including covering the FCC, FTC, Congress, the major media trade associations, and the federal courts. In addition to Multichannel News and Broadcasting + Cable, his work has appeared in Radio World, TV Technology, TV Fax, This Week in Consumer Electronics, Variety and the Encyclopedia Britannica.