Satellite Challengers to C-Band Order Seek FCC Stay While Appealing
Small satellite operators (SSO) challenging the FCC's C-band clearing order (see 2005050047) asked the agency to delay acting further pending judicial review before the U.S. Court of Appeals for the D.C. Circuit. Proceeding watchers said the agency is unlikely to accede. The commission didn't comment.
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A stay would "prevent irreparable harm to the SSOs, and ... avoid setting in motion the machinery of an unlawful auction that cannot be unwound," said ABS Global, Empresa Argentina de Soluciones Satelitales and Hispasat in the docket 18-122 joint petition for stay Monday. If the FCC doesn't act by May 25, they will "treat inaction by that date as a denial and seek relief from the D.C. Circuit."
The FCC commonly gets petitioned for stays or time extensions, but in this case Chairman Ajit Pai has been adamant about an auction starting by year's end, said Lawrence Spiwak, Phoenix Center president. Robert McDowell with Cooley emailed that the auction "is a top-tier legacy spectrum item for the Pai FCC."
The FCC rarely grants such motions for stays, emailed Andrew Schwartzman, Benton Institute for Broadband & Society senior counselor. It's common for parties like the SSOs to set their own deadline and warn the agency they will seek a judicial stay afterward, he said. That agency request for a stay needs to include all the basic arguments it intends to present to the court or that would be a basis for the court to reject the argument, he said.
The petitioning SSOs said the FCC greatly exceeded authority under Section 316 of the Communications Act, which allows it to modify licenses, eliminating a basic right that comes with their licenses. Whether the SSOs need all 500 MHz of the band since they have relatively few customers there "is irrelevant to whether Section 316 grants the power the Commission claims," they said. The SSOs said even if the FCC does have Section 316 authorization to act as it did, the commission didn't defend and provide fair notice of its new policy toward incumbents.
The agency's accelerated clearing bonus -- a "multi-billion-dollar giveaway" to other C-band satellite incumbents -- was "precisely the opposite of how Congress has permitted incentive payments for the voluntary relinquishment of spectrum to work," the SSOs said. They said the FCC wrongly is letting incumbents seek reimbursement of the cost of replacing satellites that would have needed replacing regardless of the C-band proceeding. The SSOs had their own cheaper band-clearing plan than what the agency went with, but the FCC "did not seriously discuss this proposal." they said. Even if the agency's reimbursement system is reasonable, the SSOs said, excluding Hispasat and ABS isn't. They said the reimbursement regime puts them at a competitive disadvantage vis-a-vis big incumbents Intelsat and SES, with those two getting free replacements of aged satellites while the SSO competitors with newer satellites lose C-band capacity at the start of their investment cycle.
Michael Calabrese, director of the Wireless Future Program at New America, said the D.C. Circuit is unlikely to grant a stay because even if it finds the SSOs are due financial compensation, that's something that could be done after the fact and doesn't necessitate holding up clearing. He said they face a challenge in their appeal because they aren't even using the band, while acceleration payments aren't compensation for the spectrum but for the act swift clearing.