Bankruptcy law 1, FCC O. (Capital Watch).(the FCC cannot revoke a spectrum holders' licenses just for not paying debts to the government)(Brief Article)

Broadcasting & Cable, February, 2003

The FCC may not revoke a spectrum holders' licenses solely for failure to pay debts to the government, the Supreme Court has ruled.

The decision sets the stage for resolving a seven-year dispute between the FCC and NextWave Telecom. In 1996, NextWave had the winning, $4.7 billion bid for wireless licenses in dozens of the country's largest markets but declared bankruptcy after paying the government just $500 million. In a bid to resell the licenses, the FCC re-auctioned them in 2001 for $16 billion to Verizon and other major telecoms, but a lower court ruling invalidated the sale. Although the specifics of the NextWave case limit the ruling's applicability, it puts to rest the FCC's assertion that the interests of regulators can trump bankruptcy law.