WASHINGTON—The U.S. Federal Communications Commission (FCC) has decided to keep deposits from the re-auction winners of the personal communications services (PCS) C- and F-block licenses of bankrupt NextWave Telecom and Urban Comm-North Carolina.
It had been widely expected the FCC would return the bulk of the more than US$3 billion in deposits, but withhold a small portion pending the outcome of the government’s Supreme Court appeal. Now industry sources said no money will be returned until after the Supreme Court decides whether to hear the government’s appeal.
NextWave is set to file its response to the government’s appeal on Friday. The Supreme Court is expected to decide whether to take the case sometime during the second quarter.
The U.S. Court of Appeals for the District of Columbia Circuit on 22 June said the FCC erred when it canceled, re-allocated and re-auctioned NextWave’s 95 C- and F-block PCS licenses.
Urban Comm’s bankruptcy case has been on hold while the government deals with NextWave’s bankruptcy issues. Since Urban Comm filed for bankruptcy in the same court, it is assumed Urban Comm also eventually will get its licenses back. Based on that, re-auction winners asked the FCC to return not only the deposit money for licenses associated with NextWave, but also those of Urban Comm.
The FCC did not immediately respond to a request for comment.
Verizon Wireless, which has been the most vocal with re-auction winner concerns, earlier had said it would no longer participate in any settlement arrangement between the FCC and NextWave unless it receives its US$1.8 billion deposit on the licenses it “won” during the re-auction. In addition to being out billions of dollars in deposits, some reports have indicated the companies are losing as much as US$3 million per week in interest.
