DEs, Public Interest Groups Back Council Tree against FCC
Council Tree won support for its federal court challenge to FCC designated entity rules from other DEs and public interest groups, which filed an amicus brief in the case. Council Tree, Bethel Native Corp. and the Minority Media and Telecommunications Council asked the Third Circuit Court of Appeals in Philadelphia to vacate the AWS-1 and 700 MHz auction results. The court has not set oral arguments in the case, pending there in one form or another more than two years.
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Ten public interest groups signing the pleading include the NAACP, the Rainbow PUSH Coalition and the National Indian Telecommunications Institute. Also signing were DEs Antares Holding, Faithfone Wireless, Kinex Networking Solutions, OVTC, Wirefire Partners and Xanadoo 700 MHz DE.
Bidding credits for DEs were the FCC’s “sole means” of meeting a Telecom Act mandate that small businesses and minorities be able to buy spectrum licenses, the brief noted. “The DE program worked successfully for a number of years to increase inclusion of women and minority-owned businesses, which had been blocked from competitive participation,” the group said. But in 2006, “merely weeks” before the AWS-1 auction was to start, “without Congressional approval, advance notice, or appropriate deliberation, the FCC effectively dismantled the last element of the DE program.”
Under the Telecom Act the FCC must “provide a meaningful opportunity for DEs to participate in auctions,” said Shelly Spender, president of Wirefree Partners. The agency also is to adopt “regulations that provide flexibility for DEs to run their businesses” and also ensure “regulatory certainty, stability and sufficient notice of new rules that impact the ability of DEs to raise capital and develop viable business plans,” Spender said. But in adopting revised DE rules two years ago “the FCC failed miserably on all three counts,” he said.
“We joined the brief because we were concerned about the FCC’s decision-making,” said Cheryl Leanza, policy director at the United Church of Christ. “Access to capital is a major hurdle for small businesses and a serious barrier to increasing diversity and competition.”
The Third Circuit refused to issue a stay before the AWS-1 auction began in August 2006, but later heard oral arguments on the merits of Council Tree’s case against the FCC. Ultimately, a three-judge panel said it lacked jurisdiction because Council Tree filed its challenge before the AWS auction order was final (CD Oct 1 p1), though the panel left the door open for this additional challenge.