Lottery losers allege settlement pacts struck by winners illegal

Mobile Phone News, Jan 18, 1990

LOTTERY LOSERS ALLEGE SETTLEMENT PACTS STRUCK BY WINNERS ILLEGAL

Two organizations that may have been unsuccessful in obtaining rural service area (RSA) markets in recent FCC lotteries are asking that licenses be denied to 18 lottery winners they claim participated in illegal partial settlement agreements.

Petitions filed by the 2 organizations, identified as Applicants Against Lottery Abuses (AALA) and The Committee for a Fair Lottery (TCFL), did not identify members, but stated they were "applicants in good standing."

Alpha Cellular, a market winner cited among the 18 in the AALA/TCFL petition, filed a counter petition asking that the FCC dismiss the AALA/TCFL petition because the protest was not filed within the proper timeframe and did not contain affidavits supporting the organizations' standing.

According to the Alpha Cellular petition, AALA and TCFL filed their protest before the FCC officially declared Alpha Cellular a winner in the Dec. 13 lottery for Ohio market No. 586. Alpha Cellular stated in the petition that "it (Alpha Cellular) has not been designated as the tentative selectee (for the market) and, in the ordinary course, will not be so designated for quite some time."

FCC rules state that protests from losers must be filed only within 45 days of the public notice announcing the winner's tentative selection.

The Alpha Cellular petition also said that the AALA/TCFL petition does not identify the applicant/petitioners "and their standing," and, according to the petition "should be dismissed on that ground alone."

...RSA Losers Charge Winners Entered into Illegal Settlements

The AALA/TCFL petition states that the 18 winners cited in their petition signed a "Linked Partnership Agreement" that "appeared to have all the characteristics" of an illegal partial settlement agreement, in September 1988.

According to the AALA/TCFL petition, the agreement stated that if a member won an RSA, the winner would keep 50% of the profits from its operation or from its sale, and would split the remainder with other members.

The FCC stated in its Third Report and Order on Cellular issued in 1988 that such agreements were forbidden.

The AALA/TCFL petition said a partial settlement agreement "cannot be changed just by agreeing to call it something different."

The petition also said that such agreements were "exactly [what] the FCC wanted to avoid" because they "facilitated efforts of mass marketers to sell applications to persons whose intent was speculative, and not to construct and operate a cellular system."

* The Westfield, N.J., police department is the latest New Jersey law enforcement agency to use a mobile telephone to complement its communications network. The cellular phone was donated by Bell Atlantic Mobile Systems manager Don Acrin and was installed in Police Chief Anthony Scutti's vehicle, making it a mobile command post. Acrin said donated cellular phones are being used by police agencies in Paramus, Oradell and Evesham townships and by task forces organized to combat auto thefts and narcotics traffic. (Bell Atlantic Mobile Systems, 180 Washington Valley Road, Bedminister, NJ 07921 201/306-7552)

* By dialing "AAA" on their mobile telephones, Chicago area users of Ameritech Mobile telephones can contact emergency road service experts under an agreement announced by Ameritech Mobile Communications Inc. of Chicago and the American Automobile Association (AAA). According to Patricia Graham, communications manager for Ameritech Mobile in Chicago, the easy-to-remember number assures that Ameritech Mobile customers who are AAA members will get "quick connections" to emergency road service experts. (Ameritech Mobile Communications, 1515 Woodfield Road, Suite 1400, Schaumburg, IL 60173, 708/706-7632.)

* A U.S. Circuit Court of Appeals has upheld a lower court ruling that found that U S West/NewVector of Bellevue, Wash., did not violate Sherman Antitrust restrictions during its startup period in 1985. The court ruled on Dec. 20, 1989, that NewVector's 100% share of the cellular market during that period was not sufficient to establish violation of the Sherman Act, and that NewVector did not have the power to exclude competitors because of FCC regulations and insufficient financial backing. The original complaint against NewVector was brought by Metro Mobile CTS. (U S West/NewVector Group, 3350 161st Ave. SE, Bellevue, WA 98008-1329, 206/747-4900.)

* Nokia Mobile Phones, the Finnish-based parent company of Nokia-Mobira of Largo, Fla., has completed a $12 million deal with the Dutch PTT to provide the country with telephone instruments and to conform the country's current mobile phone system to new privacy standards. (Nokia-Mobira, 2300 Tall Pines Drive, Suite 100, Largo, FL 33541, 813/536-5553.)

* The National Association of Cellular Agents (NACA) has formed the NACA Cellular Network to serve merchandisers, direct mail marketers, agents and carriers seeking nationwide activation. NACA Executive Director Bob White said the network is fully operational, providing coverage in every market with installation and activation performance not previously available. (NACA Cellular Network, 8552 Katy Freeway, Suite 130, Houston, TX 77024, 713/468-0945.)