WASHINGTON-A 44-member group with rural cellular applications pending at the Federal Communications Commission petitioned the U.S. Court of Appeals for the District of Columbia Circuit April 17 to mandate lotteries to resolve what for some has been a nine-year battle.
Writing that the FCC last fall “snatched away” its members’ “opportunity to participate in fair lotteries” six days before they were scheduled to begin, the Coalition for Equity in Licensing wants the court to instruct the FCC to hold lotteries within 90 days to settle the remaining 20 or 25 mutually exclusive applications. In the case of licenses that must go through the lottery process again due to dismissal of some applications, none have been held in the last five years.
Thomas Gutierrez of Lukas, McGowan, Nace and Gutierrez, who filed on behalf of the group, expects the court to evaluate the writ for several weeks before making a decision whether to accept it or not. He also said he “doesn’t harbor any false hope” that the writ will motivate the FCC to take action regarding a relottery.
Gutierrez’s clients just want the commission to follow through with its promises, he said. Following the signing of the Omnibus Budget Reconciliation Act of 1993, which gave the FCC permission to auction certain spectrum, the commission, according to the group, “decided that applications for cellular unserved areas filed shortly prior to July 26, 1993, would be lotteried … Moreover, the FCC did not revisit its selection process for the mutually exclusive applications filed in 1988 for the initial cellular systems in the RSAs. Those applications would continue to be processed under the FCC’s rules when they were filed unless the FCC `determines otherwise in a particular case.’ “
The coalition cited documents that had FCC Chairman Reed Hundt saying, “Auctions are good. And lotteries are bad,” adding “the FCC’s main mission, at least in the eyes of its chairman, appears to be to generate auction revenues for the Treasury, no matter how insignificant the amount.” Despite that, the commission, the coalition continued, decided to resume the relottery process and scheduled the first for Sept. 18, 1996, at which time the Puerto Rico 5-Ceiba would be assigned. That relottery never took place, the group contended, due to ex parte presentations made by the interim cellular operator in that area, Cellular Communications of Puerto Rico Inc.; that operator wanted the license to be auctioned rather than lotteried, reportedly because it had the monopoly on the other RSAs in Puerto Rico and did not want to deal with the possibility of having to buy the market in a private sale should someone else win it by luck of the draw. That request was not disclosed by the FCC, the group said, and on Sept. 10, 1996, “the FCC’s Wireless Telecommunications Bureau promptly postponed the scheduled relottery without explanation.”
The commission then released a public notice regarding a possible auction of the Puerto Rican license, even though, the group wrote, “the FCC acknowledges that the pleading was an `impermissible’ ex parte presentation.” So far, the commission has not acted on any comments received on this issue.
The coalition also said $733,000 had been collected by the FCC in RSA application fees ($200 per application) under the umbrella of “regulatory services,” and that “the FCC should have felt contractually bound to render the `regulatory services’ it had promised for eight years. The FCC should be ordered to conduct the fair lotteries it was paid to provide.”
