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Appeals Court rejects FCC
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August 24, 2001: 9:09 a.m. ET
Agency loses fight to delay turning over wireless licenses to Nextwave
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NEW YORK (CNNfn) - A U.S. appeals court has refused to delay the process for handing over valuable wireless licenses to bankrupt NextWave Telecom Inc. because the company said it will not use the airwaves until the Supreme Court decides whether to hear the case against it.
The Federal Communications Commission plans to appeal a ruling by the U.S. Court of Appeals for the District of Columbia charging the agency with violating bankruptcy laws when it repossessed the licenses from NextWave after the company failed to make payments on time.
The FCC asked not to be forced to hand over the licenses to NextWave, which is reorganizing under bankruptcy protection, until the Supreme Court decides whether to hear the appeal, but the company has said it would not use the airwaves until the high court decides.
The FCC, which tried to resell the licenses for nearly $16 billion in January, had asked the appeals court earlier this month to postpone its decision
"In light of (NextWave's) stipulation that they will make the effectiveness of their plan of reorganization contingent upon a final decision from the Supreme Court ... the FCC cannot demonstrate any substantial harm would result from the continuation of the bankruptcy proceedings during the limited pendency of the certiorari petition," the three-judge panel wrote.
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The FCC must determine whether bankrupt NextWave still meets qualifications before turning over the licenses.
The U.S. Supreme Court is not likely to hear the case until November.
Officials of NextWave, which secured $5 billion in new financing earlier this month, want the licenses back as part of its reorganization plan, which could be complete by December if the Supreme Court refuses the case, the company said.
The FCC had planned to turn the licenses over to Verizon Wireless (VZ: Research, Estimates) following an auction last January, and VoiceStream Wireless. Both companies have urged the government to open settlement talks with NextWave to preserve the outcome of the auction by offering the company as much as $5 billion to abandon its claim to the airwaves. 
From staff and wire reports
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