AWID Halts Sales of RFID Readers

By Mary Catherine O'Connor

Apr. 27, 2006—Applied Wireless Identifications (AWID), a Morgan Hill, Calif., manufacturer of interrogators and interrogator modules, says it is looking into claims that at least some of its products are not certified as compliant with Federal Communications Commission (FCC) rules. As a result of its investigation, the company has stopped shipping and importing all of its products and ousted its chairman and CEO, Donny Lee.

The FCC regards RFID devices as low-power transmitting devices and, therefore, does not require users of RFID devices to obtain a license to operate them. Before RFID device manufacturers can begin marketing products, however, they must submit them to the FCC for testing. The FCC then determines if the devices are compliant with the FCC's Part 15 rules for intentional radiators. If the agency grants authorization, the manufacture must label the device as being compliant before selling it.

"We know that we have products that are not in compliance with the FCC," says AWID vice president of marketing, Louis Sirico, "but we're currently investigating exactly what we have that is in compliance, and what we have that is not."

The issue first came to light on Mar. 20, when an AWID customer notified the company that devices it purchased were not listed on the FCC Web site as being certified. On April 5, AWID management hired the law firm Orrick, Herrington & Sutcliffe to head an independent investigation into the noncompliance and who was responsible. Additionally, AWID has retained Wilkinson Barker Knauer, which is working with Orrick, Herrington & Sutcliffe on matters relating to the FCC. Wilkinson Barker Knauer is also serving as a liaison between AWID and the FCC.

On April 7, AWID posted a notice on its Web site that Larry Kellam, a retired Procter & Gamble executive who previously led that company's EPC efforts, had assumed the role of interim chairman and CEO. Kellam has been on the AWID board for the past two years.