NEXTWAVE RE-AUCTION WINNERS ASK FCC TO REFUND DOWN PAYMENTS
Companies that won NextWave’s licenses in re-auction year ago asked FCC Fri. to refund $3.1 billion in down payments that agency has been holding without interest since Feb. Re-auction winners said that with proposed settlement falling through and new solution not immediately apparent, “the time has come” for Commission to return money. They said they were losing at least $430,000 a day in interest, assuming “conservative” rate of 5%, and urged agency to act on their petition by Jan. 18.
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Re-auction winners include Verizon Wireless and 12 other companies, including ones backed by AT&T Wireless and Cingular Wireless. Verizon’s share alone would be $1.7 billion, AT&T-backed Alaska Native Wireless $544.7 million and Cingular’s Salmon PCS $416.2 million. FCC repossessed NextWave’s licenses in 2000 and held new auction early in 2001. However, U.S. Appeals Court, D.C., in June overturned Commission decision to re-auction spectrum and ordered licenses to be given back to NextWave. Agreement among re- auction winners and NextWave fell through Dec. 31 when Congress failed to give needed endorsement. Re-auction winners also asked for $93 million in refunds of down payments made on licenses that previously were controlled by smaller company, Urban Communicators. Like NextWave, Urban Communicators had bid for C-block licenses in 1996 PCS auction and then filed for bankruptcy, with FCC cancelling its licenses when it missed payment.
“As the Commission is aware, Congress did not pass such legislation, thus causing the settlement to terminate,” companies told FCC in petition. “Consequently, the auction 35 winners now face an indefinite period of time before there is any prospect that the Commission could lawfully provide them with the NextWave licenses they won.” Although there are petitions seeking U.S. Supreme Court action, favorable ruling could take long time, they noted. “The settlement that the parties reached has expired, and the auction 35 winners now face an indefinite, and possibly fruitless, wait to receive the NextWave licenses that they won,” petition said: “The auction 35 winners refrained from filing refund claims while they devoted considerable time and resources to the settlement effort. At the very least, this financial sacrifice by the auction 35 winners should be recognized by prompt favorable action on this request.”
Petition indicated that settlement still was possible, saying refunds would free up funds “for productive, customer- benefiting uses, thereby mitigating the burdens the auction 35 winners will face if settlement talks are reinitiated.