MobileMedia Corp. said it plans to appeal an administrative law judge’s recent denial of its April 23 request for a stay of hearing, which was ordered by the Federal Communications Commission April 7. The order directs the judge to recommend-within six months-whether MobileMedia should be allowed to retain its paging licenses after misrepresenting the buildout status of hundreds of paging stations.
Separately, the company announced it received the remaining $100 million debtor-in-possession funding from its bank group led by Chase Manhattan Bank.
The administrative law judge felt MobileMedia did not fulfill the requirements under the FCC’s Second Thursday Doctrine, upon which the company grounded its request for a stay, said MobileMedia spokeswoman Krista Grossman. The doctrine is a precedent allowing that companies in Chapter 11 bankruptcy don’t necessarily need to go through the hearing process if there will be a change of control of the company, added Grossman. “Through our Chapter 11, we’ll almost necessarily go through a change of control,” she added.
According to DiP agreements, MobileMedia was in line to receive the last half of its $200 million loan May 1. The money “will be used for normal business operations and other cash needs,” said Grossman.
MobileMedia filed for Chapter 11 bankruptcy in January and signed agreements for the DiP financing in February. Several conditions were met to receive various amounts from the $200 million fund.
Last fall, the company admitted to violations in a host of Form 489 filings, which are submitted when a station has been built. The FCC’s Hearing Designation Order directs an administrative law judge to recommend a decision, but the FCC will ultimately decide whether to revoke or allow MobileMedia to retain its licenses.
