Mobile Communications Corp. of America v. F.C.C., s. 93-1518
| Decision Date | 08 May 1996 |
| Docket Number | 94-1552 and 94-1553,Nos. 93-1518,s. 93-1518 |
| Citation | 77 F.3d 1399 |
| Parties | MOBILE COMMUNICATIONS CORPORATION OF AMERICA, et al., Appellants, v. FEDERAL COMMUNICATIONS COMMISSION, Appellee, Mobile Telecommunications Technologies Corporation, Intervenor. MOBILE TELECOMMUNICATIONS TECHNOLOGIES CORPORATION, et al., Appellants, v. FEDERAL COMMUNICATIONS COMMISSION, Appellee, Cox Enterprises, Inc., et al., Intervenors. |
| Court | U.S. Court of Appeals — District of Columbia Circuit |
Appeals of an Order of the Federal Communications Commission.
Michael Deuel Sullivan, with whom L. Andrew Tollin, Craig E. Gilmore, Georgina M. Lopez-Ona, Washington, DC, Walter H. Alford, Atlanta, GA, John F. Beasley, Athens, GA, William B. Barfield and Jim O. Llewellyn, Atlanta, GA, were on the briefs, argued the cause, for appellants Mobile Communications Corporation of America, et al.
Richard E. Wiley, with whom Ray M. Senkowski, Daniel E. Troy, Timothy B. Dyk and Barbara McDowell, Washington, DC, were on the briefs, argued the cause, for appellants Mobile Telecommunications Technologies Corporation and Destineer Corporation.
Joel Marcus, Counsel, Federal Communications Commission, with whom William E. Kennard, General Counsel, and John E. Ingle, Deputy Associate General Counsel, were on the brief, argued the cause, for appellee in 93-1518. James M. Carr and Renee Licht, Counsel, Washington, DC, entered appearances.
John E. Ingle, Deputy Associate General Counsel, Federal Communications Commission, with whom William E. Kennard, General Counsel, and Michael F. Finn and Joel Marcus, Counsel, were on the brief, argued the cause, for appellee in 94-1552 and 94-1553. James M. Carr, Washington, DC, entered an appearance.
Richard E. Wiley, Ray M. Senkowski and Daniel E. Troy, Washington, DC, were on the brief, for intervenors Mobile Telecommunications Technologies Corporation and Destineer Corporation.
Jonathan D. Hart, Laura H. Phillips, Robin H. Sangston and Werner K. Hartenberger, Washington, DC, entered appearances, for intervenor Cox Enterprises, Inc.
J. Laurent Scharff, Joel M. Hamme and Robert J. Aamoth, Washington, DC, were on the brief, for intervenor Paging Network, Inc.
E. Edward Bruce, John F. Duffy and Robert A. Long, Jr., Washington, DC, entered appearances, for amicus curiae American Personal Communications.
Before: EDWARDS, Chief Judge, BUCKLEY and WILLIAMS, Circuit Judges.
Opinion for the Court filed by Circuit Judge WILLIAMS.
Petitioner Mobile Telecommunications Technologies Corp. ("Mtel") received a "pioneer's preference" in 1993 as a reward for developing technology making it possible to transmit information through the airwaves much faster than had formerly been possible. See Notice of Proposed Rule Making and Tentative Decision, Amendment of the Commission's Rules To Establish New Personal Communications Services, 7 F.C.C.R. 5676, 5735-36 pp 149-51 (1992) ("Tentative Preference Order"); First Report and Order, Amendment of the Commission's Rules To Establish New Personal Communications Services, 8 F.C.C.R. 7162, 7172-75 pp 57-77 (1993) ("Final Preference Order"). The preference entitled Mtel to bypass what had been the traditional mechanism for allocating licenses, through a "comparative hearing," after which the successful applicant would receive a license free of charge. Mtel would instead receive a communications license, specifically a narrowband personal communications service ("PCS") license, without having to face competing applications, and, under the assumptions prevailing when the preference was awarded, without having to pay. Unfortunately for Mtel, Congress drastically changed the background norm for licensing before Mtel could actually receive its license. It amended the Communications Act to allow the Federal Communications Commission to use auctions for allocation of some kinds of licenses (including PCS licenses) when "mutually exclusive applications are accepted for filing," see Omnibus Budget Reconciliation Act of 1993, Pub.L. No. 103-66, § 6002 (codified at 47 U.S.C. § 309(j)) i.e., on occurrence of the event that formerly would have triggered a comparative hearing. In the case of a pioneer's preference, this condition for licensing via auctions was not satisfied, as the preference gave its holder a pass on any such competition. But as other parties receiving similar licenses would have to pay for them at market rates, the Commission confronted the issue of how to treat Mtel's preference: Should it escape not only competition with other applicants for a license but also the necessity of payment?
The Commission originally ruled that Mtel would not be required to pay. Notice of Proposed Rule Making, Review of the Pioneer's Preference Rules, 8 F.C.C.R. 7692, 7694-95 p 18 (1993) ("Pioneer's Preference Review I"); see also First Report and Order, Review of the Pioneer's Preference Rules, 9 F.C.C.R. 605, 610 n. 21 (1994) ("Pioneer's Preference Review II") (reaffirming original determination); Memorandum Opinion and Order, Amendment of the Commission's Rules To Establish New Narrowband Personal Communications Services, 9 F.C.C.R. 1309, 1316 p 45 (1994) ("Narrowband Order") (same). It then reversed itself, requiring payment of what amounted to a substantially discounted auction price--the lesser of "ninety (90) percent of the lowest winning bid for a nationwide narrowband PCS license" and "three million dollars ($3,000,000) less than the lowest winning bid for a nationwide narrowband PCS license." Nationwide Wireless Network Corp., 9 F.C.C.R. 3635, 3639-41 pp 15-20 (1994) ("Licensing Decision").
Mtel objects that the Commission lacks statutory authority to impose a payment requirement, and that in any event it failed to engage in reasoned decisionmaking in reaching the determination to impose the payment requirement. We agree with the Commission that it has statutory authority to require payment but find its explanation of imposing the requirement on Mtel inadequate--particularly in its back-of-the-hand treatment of Mtel's argument that its reliance on the preference as originally conceived called for granting a license free of charge. Accordingly, we remand the case to the Commission for reconsideration of Mtel's contentions.
In addition, petitioner Mobile Communications Corporation of America ("MobileComm"), an unsuccessful applicant for a pioneer's preference, challenges both the original preference grant and the Licensing Decision, basically on the ground that the Commission failed to provide an adequate basis for its award of a preference and, then, a license to Mtel. We reject these contentions.
Section 402(b)(1) of the Communications Act gives this court jurisdiction over an appeal of a decision or order of the Commission brought by an "applicant for a construction permit or station license, whose application is denied by the Commission." 47 U.S.C. § 402(b)(1). "Station" is defined by the Communications Act as "a station equipped to engage in radio communication or radio transmission of energy," id. § 153(k), and includes mobile as well as land stations. See id. § 531(l ) & (m). Further, § 153 defines "mobile service" in language implying that narrowband PCS is a service involving mobile or land stations or both:
(n) "Mobile service" means a radio communication service carried on between mobile stations or receivers and land stations, and by mobile stations communicating among themselves, and includes ... (3) any service for which a license is required in a personal communications service established pursuant to the proceeding entitled "Amendment to the Commission's Rules to Establish New Personal Communications Services" [i.e., the Tentative Preference Order]....
Id. § 153(n) (emphasis added). Thus, we have jurisdiction over Mtel's appeal under § 402(b)(1) if, as required by that section, its "application [was] denied by the Commission."
If Mtel's application were an application for a license subject to any sort of condition the Commission might choose to impose, then the Licensing Decision would not be a denial of the application; Mtel was granted a license, though subject to the payment requirement. On the other hand, if, as we think is the case, Mtel was applying for a license of a specific sort --here, one free of charge, as had traditionally been the case--then the Licensing Decision is a denial. Several considerations support this view of Mtel's application. First, it made specific reference to its financial terms, namely the associated administrative fee of $230, implying that it was an application for a license at the price of the administrative fee. Second, interpreting an application as one for a license subject to any condition of the Commission's choosing would permit the Commission to foreclose judicial review of a de facto denial by couching its decision as an approval subject to some intolerable condition. At least it would have this effect unless § 402(a), allowing review under the Hobbs Act, 28 U.S.C. § 2342, of any attack on an order of the Commission under the wire or radio communications chapter of its authority "except those appealable under [§ 402(b) ]," is a general catch-all that picks up anything that falls through the cracks of § 402(b). Whether or not this is true is immaterial for present purposes because Mtel's application is more properly viewed as being for a free license, so that the Commission's order qualifies as a "denial" within the meaning of § 402(b)(1).
Nonetheless, a party whose license application has been denied by approval subject to conditions (other than ones requested by the applicant) must...
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