Previous applicants for wireless licenses are suing FCC for $148 ...

include Gene Folden, Boca Raton; Judith Longshore, Canton, N.Y., Coastal Communications Assoc., Charleston, S.C. Lawsuit, filed in U.S. Court of Federal Claims, argued that agency had breached “implied contracts” to award 7 cellular licenses by lottery, saying govt. owed them and other lottery applicants pro rata share of current market value of spectrum. Applicants said they paid U.S. $855,200 to participate in lotteries that Commission held in 1989. FCC later found lottery winners to be unqualified and scheduled replacement lotteries for 6 of 7 licenses in July 1996, cancelling re-lotteries few months later. In 1997, Congress cancelled FCC’s authority to use lotteries, replacing them with auctions. After that, FCC awarded spectrum to 3 of originally disqualified lottery winners at direction of Congress. Plaintiffs said FCC “apparently intends” to auction 4 remaining cellular licenses that had been at issue. FCC Wireless Bureau released order March 2 that denied reconsideration of lottery participants’ application for 7 licenses. Licenses at issue are in Ark., Fla., Minn., N.D., Pa., P.R. and Tex. and range in estimated value from $4 million to $53.5 million. Suit said FCC, by not awarding 7 licenses by lottery, deprived applicants “of their contract rights to have chances of winning licenses.” Robert Kerrigan, attorney for lottery applicants, said govt. took money from applicants, kept $200 per applications that had been paid and then used another system to award licenses. “Although the government can do that from a regulatory perspective, the folks who paid to enter the lottery are entitled to the benefit of their bargain, which in this case is their pro rata share of the fair market value of those licenses,” he said. Kerrigan has represented state of Fla. against tobacco industry. He said there were 926 members of class of lottery applicants for 7 licenses who would share value of $148 million on pro rata basis, depending on which lotteries they entered, “minus expenses and attorney fees.”