[Federal Register Volume 61, Number 86 (Thursday, May 2, 1996)]
[Notices]
[Pages 19620-19622]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 96-10615]



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FEDERAL COMMUNICATIONS COMMISSION
[FCC 96-140]


Applications for A and B Block Broadband PCS Licenses

AGENCY: Federal Communications Commission.

ACTION: Determination or application for review.

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SUMMARY: The Commission released this Memorandum Opinion and Order 
(MO&O) to address an Application for Review filed by the National 
Association of Black Owned Broadcasters, Percy E. Sutton, and the 
National Association for the Advancement of Colored People. This MO&O 
denies the application. The MO&O is necessary to answer the issues 
addressed in the application. The intended affect of this action is to 
resolve the issues set forth in the application.

EFFECTIVE DATE: July 1, 1996.

FOR FURTHER INFORMATION CONTACT: John Greenspan, (202) 418-0620, 
Wireless Telecommunications Bureau, Commercial Wireless Division.

SUPPLEMENTARY INFORMATION: This is the text of the MO&O, adopted March 
28, 1996, released April 1, 1996. This order is available for 
inspection and copying during normal business hours at the Commercial 
Wireless Division Legal

[[Page 19621]]

Branch, Room 7130, 2025 M Street, N.W., Washington, D.C., and also may 
be purchased from the Commission's copy contractor, International 
Transcription Service, at (202) 857-3800, 2100 M Street, N.W., Suite 
140, Washington, D.C. 20037.

Memorandum Opinion and Order

I. Introduction

    1. The Commission has before it an Application for Review filed on 
July 21, 1995 by the National Association of Black Owned Broadcasters, 
Percy E. Sutton, and the National Association for the Advancement of 
Colored People (collectively ``Petitioners''), and an erratum filed by 
Petitioners on August 24, 1995, seeking review of an Order by the 
Chief, Wireless Telecommunications Bureau (the ``Bureau'') granting the 
applications filed by the auction winners of 99 broadband Personal 
Communications Services (``PCS'') licenses for the A and B block 
frequencies. In a separate pleading, Petitioners seek review of a 
Bureau Order that declined to stay the licensing of the A and B block 
winners until the licensing of the ultimate winners of the C block 
auction. See Deferral of Licensing of MTA Commercial Broadband PCS, 
Memorandum Opinion and Order, DA 95-1410, 1995 WESTLAW 379480 (Wireless 
Telecom. Bur. June 23, 1995). We address that by a separate order 
adopted today; in this Order, we deal exclusively with Petitioners' 
Application for Review of the A and B Block Order.

II. Background

    2. On May 12, 1995, Petitioners filed a Petition to Deny the 
applications of the eighteen winning bidders in the A and B block 
auction. Petitioners alleged that the Commission violated Section 
309(j) of the Communications Act, 47 U.S.C. Sec. 309(j), by failing to 
provide adequate opportunities for minorities to acquire PCS licenses 
in the A and B blocks. Petitioners further alleged that this failure to 
provide incentives has allowed a few dominant carriers to divide A and 
B block PCS licenses in an unlawful territorial allocation in violation 
of the antitrust laws. Petitioners contended that the distribution of 
licenses in the top markets indicated a pattern of collusion by these 
carriers to ``dominate the wireless telephone industry, both PCS and 
cellular.''
    3. The Bureau dismissed the Petition to Deny. First, the Bureau 
concluded that Petitioners had failed to demonstrate standing under 
Section 309(d)(1) of the Communications Act and applicable Commission 
precedent. Then, treating the petition as an informal objection, the 
Bureau further held that Petitioners had failed to show that a grant of 
the A and B block licenses would be inconsistent with the public 
interest. It rejected Petitioners' contention that the Commission had 
failed to comply with 47 U.S.C. Sec. 309(j) and deemed that contention 
``a belated attempt to revisit the Commission's auction rules for 
licensing of the A and B blocks.'' The Bureau also rejected 
Petitioners' argument that the major bidders colluded to allocate 
territory among themselves.

III. Contentions of the Parties

    4. Petitioners present the same contentions before the Commission 
that were previously rejected by the Bureau. They allege that the 
Commission has failed to comply with its statutory mandate to provide 
adequate opportunities for minorities to bid for PCS licenses. 
Petitioners also repeat their allegation that the Commission ``appears 
to have allowed the dominant carriers to divide the PCS licenses in an 
unlawful territorial allocation.'' Petitioners further dispute the 
Bureau's conclusion that Petitioners' lacked standing to raise the 
issues presented in its Petition to Deny.
    5. In opposition, Western PCS Corporation (``Western'') alleges 
that Petitioners' Application for Review is procedurally defective 
because it does not specify the factors that warrant Commission review. 
Further, Wirelessco, L.P. and Phillieco, L.P. argue that Petitioners 
lacked standing. Several parties asserted that Petitioner's petition 
claimed no acts of misconduct by them and that the petition should, 
therefore, not affect their license grant. Pacific Telesis Mobile 
Services (``Pacific Telesis'') accuses Petitioners of improperly 
seeking reconsideration of prior rulemaking proceedings. Pacific 
Telesis also argues that the Commission fully complied with its 
statutory mandate by providing for the rapid deployment of services 
without undue administrative delay. Finally, several parties contend 
that the Bureau properly rejected Petitioners' claims of collusion.

IV. Discussion

    6. We agree with Western that Petitioners' Application for Review 
is procedurally defective and must be dismissed. Section 1.115(b)(2) of 
the Commission's rules, 47 CFR Sec. 1.115(b)(2), requires Applications 
for Review to: Specify with particularity, from among the following, 
the factors which warrant Commission consideration of the questions 
presented:
    (i) The action taken pursuant to delegated authority is in conflict 
with statute, regulation, case precedent, or established Commission 
policy.
    (ii) The action involves a question of law or policy which has not 
previously been resolved by the Commission.
    (iii) The action involves application of precedent or policy which 
should be overturned or revised.
    (iv) An erroneous finding as to an important or material question 
of fact.
    (v) Prejudicial procedural error. Petitioners' pleading is 
defective because it fails to ``specify with particularity'' any of the 
above subsections as grounds for granting its Application for Review. 
See Chapman S. Root Revocable Trust, 8 FCC Rcd 4223, 4224 (1993). 
(``Chapman''). The Commission held in Chapman that a party that fails 
to identify one of the above factors in support of an application for 
review will have its application dismissed. Accordingly, we are 
dismissing Petitioners' Application for Review because it does not 
comply with 47 CFR Sec. 1.115(b)(2). Although we are dismissing 
Petitioners' pleading, we briefly will address the issues raised 
therein.
    7. The Bureau held that Petitioners lacked standing to challenge 
the A and B Block licensees on a blanket basis as it seeks to do here. 
We agree. To establish standing to file a petition to deny, the 
petitioners must allege sufficient facts to demonstrate that grant of 
the subject application would cause them to suffer a direct injury. 
AmericaTel Corporation, 9 FCC Rcd 3993, 3995 (1994) (citing Sierra Club 
v. Morton, 405 U.S. 727, 733 (1972)). The premise of Petitioners' 
standing argument is that the award of licenses to the A and B block 
applicants threatens their interests (or those of their members) as 
potential C block licensees as well as the interests of the public. We 
find, as did the Bureau, that these allegations are too contingent and 
speculative to support the required finding of a direct injury causally 
linked to the challenged action. First, there is no certainty that 
Petitioners or any of their members will in fact participate in the C 
block auction or that they will win licenses if they do. Both of these 
events must occur for any injury to even be possible. Second, we have 
previously held that the mere fact that a petitioner has applied to be 
a licensee in the same service does not confer standing. See Pittsburgh 
Partners, L.P., 10 FCC Rcd 2715 (1994), para. 4 (mere status as 
applicant in one proceeding in the FM broadcast service does not confer

[[Page 19622]]

standing as a party in interest in another proceeding in the FM 
broadcast service ); WIBF Broadcasting, 17 FCC 2d 876, 877 (1969) 
(same).
    8. In their Application for Review, Petitioners rely on the holding 
in United Church of Christ v. FCC, 359 F.2d 994, 1005 (D.C. Cir. 1966) 
(``UCC''). for the proposition that they have standing as 
representatives of the public interest. As Pacific Telesis points out, 
in UCC there were specific allegations by the party filing the petition 
to deny that the broadcast station in question was ignoring the needs 
of a major segment of the listening audience. In this case, Petitioners 
make no allegations and no party has submitted any evidence that the A 
and B block licensees will fail to provide adequate service to any 
segment of the population. Petitioners' major complaint appears to be 
that they would have preferred entities other than the successful 
bidders to have received the A and B block licenses. This is not 
sufficient to support a petition to deny. Petitioners fail to 
demonstrate how they will be harmed, either as consumers or potential 
bidders, by the granting of licenses to the A and B block winners. 
Accordingly, we conclude, as did the Bureau, that Petitioners have not 
alleged sufficient facts in this case to demonstrate that it has 
standing to challenge the A and B block licenses. We agree with the 
Bureau that a potential PCS bidder could allege facts sufficient to 
establish standing to challenge another PCS application by showing that 
grant of that application would cause them demonstrable injury. See A & 
B Block Order at 5.
    9. Petitioners repeat the argument previously made to the Bureau 
that the Commission failed to adopt specific provisions in the A and B 
block auction, which Petitioners contend is a violation of Section 
309(j) of the Act. Pacific Telesis points out in opposition that 
Petitioners fail to address the Bureau's holding that this argument 
constitutes an untimely petition for reconsideration of the 
Commission's broadband PCS auction rules rather than a valid basis for 
a petition to deny. We agree. The Bureau properly concluded that the 
purpose of the petition to deny process is to assess challenges to 
applicants' qualifications to be Commission licensees. Petitioners' 
statutory argument does not address licensee qualifications, however, 
but challenges the structure of the A and B block auction itself. We 
agree with the Bureau that Petitioners' argument was not a valid 
petition to deny, but was instead a belated attempt to revisit the 
Commission's auction rules for licensing of the A and B blocks. In the 
Fifth Report and Order in Docket No. 93-253, 59 FR 37566 (July 22, 
1994), the Commission decided against making special provisions for 
designated entities on the A and B blocks. We determined that this 
approach fully complied with Section 309(j) and affirmed this 
conclusion on reconsideration more than ten months before Petitioners 
filed their petition. Petitioners' attempt to challenge the rules again 
through the petition to deny process is therefore untimely and 
procedurally improper.
    10. Petitioners also reiterate their allegation that the dominant 
carriers have divided the PCS licenses in an unlawful territorial 
allocation. We agree with the Bureau that Petitioners have failed to 
provide evidence supporting this allegation or otherwise to demonstrate 
that a grant of the A and B block applications would be inconsistent 
with the public interest. Under Section 309(d)(1) of the Communications 
Act, 47 U.S.C. Sec. 309 (d)(1), parties filing a petition to deny must 
make specific allegations of fact sufficient to show that a grant of 
the application would be prima facie inconsistent with the public 
interest, convenience, and necessity. Except where official notice may 
be taken, such allegations must be supported by affidavits of persons 
with personal knowledge of the facts alleged. Section 309(d)(2) states 
that if the pleadings and affidavits fail to raise substantial and 
material questions of fact and the Commission concludes that grant of 
the application would be in the public interest, the Commission shall 
deny the petition. 47 U.S.C. Sec. 309(d)(2).
    11. In support of their claim of territorial allocation both before 
the Bureau and now before the Commission, Petitioners allege only that 
three companies--AT&T Wireless PCS, PCS Primeco, and WirelessCo--won 
61% of the A and B block licenses. Petitioners suggest that this 
constitutes ``circumstantial evidence'' that is not only enough to 
support a petition to deny, but ``a jury verdict finding a conspiracy 
which violates antitrust laws.'' A petition to deny must ``contain 
specific allegations of fact sufficient to show * * * that a grant of 
the application would be prima facie inconsistent with [the public 
interest].'' Where the Commission finds that such a showing has not 
been made, it may refuse the petition to deny on the basis of ``a 
concise statement of the reasons for denying the petition, which 
statement shall dispose of all substantial issues raised by the 
petition.'' In this instance, we find that petitioners' allegation of 
territorial allocation does not constitute a showing that the grant to 
the A and B block winners was prima facie inconsistent with the public 
interest. We agree with the Bureau that Petitioners have failed to 
raise a substantial or material question of fact based on these 
allegations. First, Petitioners offer no grounds for denying the 
applications of the fifteen auction winners other than AT&T, PCS 
Primeco, and WirelessCo. Second, with respect to these latter three 
applicants, Petitioners fail to provide any factual evidence of 
collusion. Contrary to Petitioners' contention that the Bureau 
improperly required a ``smoking gun,'' we agree with the Bureau's 
conclusion that Petitioners must provide a modicum of a factual showing 
that collusion occurred--particularly in an auction that lasted over 
three months and resulted in aggregate winning bids of nearly $8 
billion by 18 different parties. Petitioners introduce no evidence 
showing that AT&T, PCS Primeco, WirelessCo, or any other A or B block 
winner has violated any of the Commission's rules, including the 
collusion rules or the rules regarding aggregation of PCS spectrum. We 
also agree with Western that the bidding patterns were determined to a 
large degree by the desire of individual applicants to acquire national 
wireless footprints and/or to acquire markets complementing their 
existing telecommunications holdings. We therefore find Petitioners' 
allegation of collusion to be without merit.

V. Conclusion

    12. For the reasons discussed above, we are dismissing Petitioners' 
Application for Review for failure to comply with Section 1.115(b)(2) 
of our rules. Although our action renders further discussion 
unnecessary, we agree with the Bureau's disposition of the issues 
Petitioners raised in their original Petition to Deny.

V. Ordering Clause

    13. Accordingly, it is ordered pursuant to Section 4(i) of the 
Communications Act of 1934, as amended, 47 U.S.C. Sec. 154(i), and 
Section 1.115(b)(2) of the Commission's Rules, 47 CFR Sec. 1.115(b)(2), 
that the Application for Review filed by Petitioners on July 21, 1995, 
is denied.

Federal Communications Commission.
William F. Caton,
Acting Secretary.
[FR Doc. 96-10615 Filed 5-01-96; 8:45 am]
BILLING CODE 6712-01-P