High Court: Bankruptcy law trumps FCC

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

The decision set the stage for resolving a seven-year dispute between the FCC
and NextWave Telecom Inc.

NextWave in 1996 had the winning $4.7 billion bid for wireless licenses in
dozens of the country's largest markets, but it declared bankruptcy after paying
the government just $500 million.

In a bid to resell the licenses, the FCC reauctioned them in 2001 for $16
billion to Verizon Communications and other major telcommunications companies, but a lower-court ruling invalidated
that sale.

Although the specifics of the NextWave case limit the applicability of the
Supreme Court decision, the court's rulings put to rest the original FCC
assertion that interests of regulators can trump bankruptcy law.

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