U.S. Appeals Court, D.C., Fri. upheld FCC decision that awarded 3...

FCC’s decision to award Mercury licenses wasn’t arbitrary or irrational. Case centers on High Plains accusations that Mercury violated anticollusion rules in 1996 by using encoded signals in its bids for D-, E- and F-block licenses. Commission eventually reversed decision to impose $650,000 fine, saying its bidding rules hadn’t anticipated whether such “reflexive” bidding would violate anticollusion rules. Mercury and High Plains both bid on licenses in Lubbock and Amarillo, Tex. High Plains argued: (1) Court should overturn FCC’s award of licenses to Mercury, charging carrier had violated anticollusion rules. (2) Judges should reverse FCC decision because it erred in finding that Mercury hadn’t violated ex parte rules. (3) Court should find that Mercury “exhibited a disqualifying lack of candor.” Decision in which Judges Harry Edwards and David Sentelle joined said Mercury’s conduct probably was barred by rule, but court said it had to decide only whether FCC “reasonably could conclude the rule failed to put Mercury on notice that reflexive bidding was impermissible.” Court concluded that whether reflexive bidding violated anticollusion restrictions was unasked question before PCS auction was held: “In this circumstance, it was not unreasonable for the Commission to have deemed the rule ambiguous with respect to whether reflexive bidding was prohibited.” It also said High Plains hadn’t cited an incident in which congressional inquiries about Mercury’s licenses had violated ex parte communications requirements.