NEXTWAVE ASKS FCC TO DISMISS CHALLENGE TO ITS PCS LICENSES
Characterizing challenge to its licenses as “frivolous,” NextWave asked FCC Mon. to dismiss petition questioning its eligibility to receive PCS licenses returned to it last month by U.S. Appeals Court, D.C. In recent petition (CD July 20 p2), Alaska Native Wireless, Verizon Wireless and VoiceStream cited foreign ownership issues involving NextWave, its designated entity status and its financial qualifications to meet licensee requirements. NextWave told FCC that petitioners incorrectly labeled it as “applicant” trying to get back its C-block licenses. “No known legal standard requires NextWave to reapply for the licenses that were the subject of litigation,” NextWave said. “The FCC granted the licenses to NextWave in 1997 and the court’s unanimous June 22 decision returns them to the company by operation of law.” Carriers pursuing challenge all were successful bidders in FCC’s Jan. re-auction of PCS licenses, most of which had belonged to NextWave before Commission cancelled them for nonpayment.
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“It’s clear that certain competitors are attempting to use administrative and legal ploys to delay our wireless network rollout,” NextWave Deputy Gen. Counsel Michael Wack said. He said NextWave had financial resources and technical expertise to begin using spectrum “faster than anyone else can” and petition is “without merit.” Company disagreed with petition’s contention that FCC must act affirmatively to restore licenses that were part of remand ordered by D.C. Circuit. That court ruled in favor of original C-block bidder, finding that FCC had contravened bankruptcy law when cancelling carrier’s licenses for missed payment (CD June 25 p1). Re-auction results had been contingent on NextWave’s not prevailing in litigation. Company contends that FCC granted licenses in 1997 order, indicating on Jan. 12, 2000, that licenses had cancelled automatically in Oct. 1998. D.C. Circuit declared Commission cancellation of licenses to be invalid, NextWave said. “That means the cancellation of the licenses was undone, and the matter returned to the status quo before the Commission’s attempted cancellation,” carrier said. Because the FCC’s cancellation order was reversed, “NextWave automatically regains possession of the licenses as soon as the mandate from the D.C. Circuit issues,” it argued.
Petition by Alaska Native Wireless, Verizon Wireless and VoiceStream had argued D.C. Circuit addressed only issues related to bankruptcy code, meaning FCC still could decide to not reinstate NextWave licenses on other grounds. NextWave also told FCC: (1) It was in compliance with designated entity requirements. It disputed claims by 3 carriers that its filing for Chapter 11 protection shifted fiduciary duty to company’s creditors from its shareholders. “That argument attacks a proposed plan of reorganization that never was and never will be enacted,” NextWave said.
(2) There’s no basis to investigate challenge to NextWave’s compliance with foreign ownership provisions. It said FCC’s Wireless Bureau had conditionally granted PCS licenses, in part because it concluded that any violation of statutory benchmark for foreign ownership was de minimis. “Petitioners ignore the 1997 World Trade Organization agreement and the Commission’s subsequent implementing rules, which effectively eliminate foreign ownership issues in all but the most egregious circumstances and conclusively establish the validity of NextWave’s ownership structure,” carrier said.
NextWave also argued that FCC didn’t have any reason to investigate because company’s corporate and regulatory undertakings had been outlined in Bankruptcy Court filings that Commission had received. It also said audit based on its 1999 plan of reorganization would “be patently absurd because that plan wasn’t ever enacted and will be replaced shortly by updated proposal. Petitioners effectively urge the Commission not only to once again violate fundamental requirements of due process and administrative law and Section 525 of the Bankruptcy Code, but also to defy the D.C. Circuit’s June 22, 2001 ruling.”