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RFID Reader Maker Announces FCC Problems

Yesterday afternoon RFID reader manufacturer AWID issued a statement from its chairman and interim CEO Larry Kellam. In a nutshell, the statement indicates that some of the company's products are not compliant with the rules of the FCC, the US governmental agency which regulates the radio waves.
Apr 27, 2006This article was originally published by RFID Update.

April 27, 2006—Yesterday afternoon RFID reader manufacturer Applied Wireless ID, known to most as AWID, issued a statement from its chairman and interim CEO Larry Kellam. In a nutshell, the statement indicates that some of the company's products are not compliant with the rules of the Federal Communications Commission (FCC), the US governmental agency which regulates the radio waves (among other things). The statement does not list exactly which products are noncompliant, but says that a comprehensive investigation has been launched to determine the extent of the issue.

The company was first made aware of possible problems on March 20th, when a customer faxed the company saying that certain AWID products it had purchased appeared not to be FCC-certified. AWID vice president of marketing Louis Sirico informed president Jeffrey Jacobsen of the fax and began to investigate. On April 5th, the company brought in law firm Wilkinson Barker Knauer LLP as "FCC counsel" as well as Orrick, Herrington & Sutcliffe LLP as "new outside counsel". Two days later, on the 7th, AWID's board terminated the employment of Donny Lee, who had been serving as chairman and CEO. Lee was also founder of the company. It seems reasonable to infer that the board perceived Lee to have some role in the issue, however the statement stops short of specifying any reason for the termination. Indeed, part of the company's investigation includes why there is a noncompliance issue and exactly who is responsible.

Upon Lee's termination, board member and 36-year Procter & Gamble veteran Larry Kellam was appointed chairman and interim CEO. The company has begun informing customers of the FCC issues, and staff at the FCC itself has also been notified. The statement does not explicitly say that the company has frozen sales, but due to the line "The company will ... resume its sales of its products as quickly as practicable", it appears that is in fact the case.

AWID sells not only standalone RFID readers, but reader modules as well, which are typically embedded in third-party devices like label printers to add RFID functionality. One of the questions raised by this announcement is whether any such third-party devices are also noncompliant due to their inclusion of AWID modules. The statement says no, to the company's knowledge: "This issue does not affect AWID reader assemblies embedded in devices manufactured by others, such as handhelds, printers, and applicators. These manufacturers obtain certification on their own and, to our knowledge, those manufacturers have satisfied their FCC certification obligations."

Read AWID's prepared statement
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