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Petitions to Deny Club 42 Auction 78 Application Dismissed

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Released: June 10, 2013

Federal Communications Commission

DA 13-1341

Before the

Federal Communications Commission

Washington, D.C. 20554

In re Application of
)
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CLUB 42 CM LIMITED PARTNERSHIP
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Report No. AUC 78
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ULS File No. 0003573589
For New Licenses in the Broadband Personal
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Communications Service
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ORDER

Adopted: June 10, 2013

Released: June 10, 2013

By the Deputy Chief, Mobility Division, Wireless Telecommunications Bureau:
1. Introduction. In this Order, we address a petition filed on October 20, 2008 by Alpine PCS,
Inc. ("Alpine")1 to deny the "long form" application of Club 42 CM Limited Partnership ("Club 42")2 for
six of the Broadband Personal Communications Service ("PCS") licenses included in the Application
the licenses for Channel Blocks C3, C4, and C5 in Basic Trading Areas ("BTAs") 405 San Luis Obispo,
CA, and 406 Santa Barbara-Santa Maria, CA ("Licenses"). We also address the Informal Objection
filed by Stephen Kaffee3 ("Kaffee") and Kaffee's related Motion for Leave to Dismiss Informal
Objection.4 For the reasons set forth below, we dismiss the Alpine Petition and grant the Kaffee
Withdrawal Motion.
2. Background. Alpine won licenses in Auction 5 for the same PCS spectrum in BTAs 405 and
406 ("Alpine Licenses")5 as Club 42 won in Auction 78.6 Alpine participated in the Commission's


1 Alpine PCS, Inc. Petition to Deny (filed Oct. 20, 2008) ("Alpine Petition"). Club 42 CM Limited Partnership filed
an opposition to the Alpine Petition. See Club 42 CM Limited Partnership Opposition to Petition to Deny (filed Oct.
27, 2008). Alpine filed a reply. See Alpine PCS, Inc. Reply (filed Nov. 3, 2008).
2 Application of Club 42 CM Limited Partnership for New Licenses in the Broadband Personal Communications
Service, ULS File No. 0003573589 (filed Sept. 9, 2008, amended Sept. 22, 2008, Oct. 29, 2008, Mar. 20, 2012, Dec.
28, 2012, and Jan. 30, 2012) ("Application"). The Application seeks grant of authority for a total of eight Personal
Communications Service ("PCS") licenses. Club 42 filed a separate application for five Advanced Wireless
Services ("AWS-1") licenses it won in Auction 78. Application of Club 42 CM Limited Partnership for New
Licenses in the Advanced Wireless Services, ULS File No. 0003573597 (filed Sept. 9, 2008, amended Sept. 22,
2008, Oct. 29, 2008, Mar. 20, 2012, Dec. 28, 2012, and Jan. 30, 2013). No petitions to deny or other objections
were filed against that application.
3 Stephen Kaffee Informal Objection (filed Oct. 20, 2008) ("Kaffee Informal Objection"). Club 42 filed an
opposition to the Kaffee Informal Objection. See Club 42 CM Limited Partnership Opposition to Informal
Objection (filed Oct. 27, 2008) ("Club 42 Informal Objection Opposition"). Kaffee filed a reply. See Stephen
Kaffee Reply to Opposition to Informal Objection (filed Nov. 3, 2008) ("Kaffee Reply").
4 Stephen Kaffee Motion for Leave to Dismiss Informal Objection (filed July 6, 2010) ("Kaffee Withdrawal
Motion"). Club 42 filed declarations in connection with the Kaffee Withdrawal Motion. See Club 42 CM Limited
Partnership Declarations Supporting Motion for Leave to Dismiss Informal Objection (filed July 8, 2010) ("Club 42
Declarations").
5 Entrepreneurs' C Block Auction Closes, Public Notice, DA 96-716 (rel. May 8, 1996). Auction 5 closed on May
6, 1996. Alpine had net winning bids of $9,891,000 (BTA 405) and $19,200,750 (BTA 406), reflecting the 25
percent bidding credit for which Alpine, as a small business, qualified.

Federal Communications Commission

DA 13-1341

installment payment plan then available to qualified designated entities, and the grant of the Alpine
Licenses was conditioned on full and timely payment of all installment obligations.7 Alpine began
making its installment payments under the Commission's original installment payment rules, but failed to
make the interest-only installment payments for the Alpine Licenses due on January 31, 2002, along with
the required late fees, before the expiration of the two-quarter grace period permitted under the rules.8 On
July 24 and 29, 2002, rather than make the required payments, Alpine filed a request for debt
restructuring with regard to its installment payment obligations,9 which was returned by the
Commission's Office of the General Counsel without action on January 30, 2004.10 On December 18,
2007, Alpine filed a second restructuring request,11 which was dismissed without prejudice by the
Commission's Office of Managing Director on April 29, 2008.12
3. Pursuant to the Commission's rules, the Alpine Licenses automatically canceled on August 1,
2002.13 Alpine accordingly became subject to debt collection procedures.14 On July 31, 2002, one day
before the effective date of the automatic cancellation, Alpine filed a request for waiver of the
Commission's automatic cancellation rules.15 The Commission's Wireless Telecommunications Bureau


(...continued from previous page)
6 The licenses Alpine won in Auction 5 were for 30 megahertz of PCS C Block spectrum in each of BTAs 405 and
406. When that same spectrum was offered in Auction 78, it was divided into 10 megahertz licenses in each of the
two BTAs. See Alpine PCS, Inc. Request for Stay of Auction 78 for the Broadband PCS C Block Licenses in the
San Luis Obispo, CA and the Santa Barbara-Santa Maria, CA Basic Trading Areas, Order, 23 FCC Rcd 10485,
10486 5 (WTB ASAD 2008) ("Alpine Denial of Stay Order"); Auction of AWS-1 and Broadband PCS Licenses
Scheduled for July 29, 2008; Comment Sought on Competitive Bidding Procedures For Auction 78, Public Notice,
AU Docket No. 08-46, 23 FCC Rcd 5484, 5507 (2008) ("Auction 78 Comment Public Notice").
7 The then effective version of section 1.2110(e)(4) of the Commission's rules expressly provided that "[a] license
granted to an eligible entity that elects installment payments shall be conditioned upon the full and timely
performance of the licensee's payment obligations under the installment plan." 47 C.F.R. 1.2100(e)(4) (1996).
Grant of the Alpine Licenses was announced in FCC Announces Grant of Broadband Personal Communications
Services Entrepreneurs' C Block BTA Licenses, Public Notice, 11 FCC Rcd 11316 (1996).
8 Alpine PCS, Inc. Request for Waiver of Automatic Cancellation Rule for Auction No. 5 C Block Licensees for
Santa Barbara (Mkt. No. 406-C) and San Luis Obispo (Mkt. No. 405-C), Order, 22 FCC Rcd 1492, 1495 8 (WTB
2007) ("Alpine Automatic Cancellation Order"). Alpine was scheduled to make interest-only payments for the first
six years of the ten-year term of the Alpine Licenses. Id. at 1495 7.
9 Letter from Robert F. Broz, President, Alpine PCS, Inc., to Regina Dorsey, Office of Managing Director, dated
July 24, 2002; Letter from Robert F. Broz, President, Alpine PCS, Inc., to Regina Dorsey, Office of Managing
Director, dated July 29, 2002.
10 Letter from Paul K. Cascio, Office of the General Counsel, to Robert F. Broz, President, Alpine PCS, Inc., dated
Jan. 30, 2004.
11 Letter from Frederick M. Joyce, Christine McLaughlin, Counsel for Alpine PCS, Inc., to Anthony Dale, Office of
Managing Director, dated December 18, 2007.
12 Letter from Regina Dorsey, Deputy Chief Financial Officer, to Frederick M. Joyce, Counsel for Alpine, PCS, Inc.,
dated April 29, 2008.
13 Alpine Automatic Cancellation Order, 22 FCC Rcd at 1495 8.
14 Id.
15 In Re the Matter of Alpine PCS, Inc., For a Waiver of Section 1.2110(g)(iv) of the Rules Relating to the Payment
Due on July 31, 2002 Regarding Its Santa Barbara (Mkt. No. 406-C) and San Luis Obispo (Mkt. No. 405-C) C
Block Licenses, Request for Waiver, filed July 31, 2002.
2

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DA 13-1341

denied Alpine's waiver request on January 29, 2007,16 which was affirmed at the Commission level and
by the United States Court of Appeals for the District of Columbia Circuit.17
4. On April 4, 2008, the Wireless Telecommunications Bureau released a public notice
announcing Auction 78.18 The inventory of licenses to be auctioned included six 10 megahertz C block
licenses for the spectrum on which Alpine previously had been licensed to operate.19 On April 18, 2008,
Alpine filed a request to stay the auction or revise the Auction 78 Comment Public Notice to remove the
six C block licenses for BTAs 405 and 406 from the auction, which was dismissed by the Commission's
Auction and Spectrum Access Division of the Wireless Telecommunications Bureau on July 7, 2008.20
The spectrum and service areas covered by the licenses formerly held by Alpine remained in the auction,
which commenced on August 13, 2008, and was completed on August 20, 2008.21 The long-form
application of Club 42 for, among others, the broadband PCS licenses in BTAs 405 and 406, Channel
Blocks C3, C4, and C5, was found, upon initial review, to be acceptable for filing.22
5. On August 12, 2008, Alpine filed a petition for relief under Title 11 of the United States Code
in the United States Bankruptcy Court for the District of Columbia.23 Alpine also filed a motion with the
Bankruptcy Court, seeking a declaration that an automatic stay under 11 U.S.C. 362(a)24 bars the
Commission from concluding the auction of the licenses in question, which was denied.25 The United
States Court of Appeals for the District of Columbia Circuit affirmed the decision on December 21,
2010.26
6. On October 20, 2008, Alpine filed a petition to deny the Application, arguing that the
application should be held in abeyance during the pendency (at that time) of Alpine's appeals before the
Commission (i.e., the automatic cancellation waiver request) and the Bankruptcy Court (i.e., the motion to
stay the auction).27 Also on October 20, 2008, Kaffee filed his informal objection to the Application,
alleging that Club 42 has made misrepresentation about its ownership and its qualifications for bidding
credits and to participate in bidding on "closed" licenses available only to entities meeting certain size
standards.28 Kaffee concluded that grant of the Application would not serve the public interest.29


16 See generally Alpine Automatic Cancellation Order.
17 Alpine PCS, Inc., et al. Requests for Waiver of the Installment Payment Rules and Reinstatement of Licenses,
Memorandum Opinion and Order, 25 FCC Rcd 469, 478 13 (2010), aff'd Alpine PCS, Inc. v. FCC, 404 Fed.
App'x. 508 (D.C. Cir. 2010), reh. denied, No. 10-1020 (D.C. Cir. Feb. 10, 2011).
18 See generally Auction 78 Comment Public Notice.
19 Id., 23 FCC Rcd at 5507.
20 See generally Alpine Denial of Stay Order.
21 Auction of AWS-1 and Broadband PCS Licenses Closes; Winning Bidders Announced for Auction 78, Public
Notice
, 23 FCC Rcd 12749 (WTB 2008).
22 Wireless Telecommunications Bureau Announces That Applications for Broadband PCS Licenses Are Accepted
for Filing, Public Notice, 23 FCC Rcd 14773 (rel. Oct. 10, 2008).
23 Case No. 08-00543.
24 11 U.S.C. 362(a).
25 In re Alpine PCS, Inc., 2008 WL 5076983 (Bankr. D. Dist. Col. Oct 10, 2008) (No. 08-00543).
26 In re Alpine PCS, Inc., 404 Fed. App'x. 504 (D. C. Cir. Dec 21, 2010), reh. denied, No. 09-5293 (D.C. Cir. Feb.
10, 2011).
27 See Alpine Petition at 6-7.
28 See Kaffee Informal Objection at 3-11.
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DA 13-1341

Following the conclusion of the pleading cycle with respect to the Application, on July 6, 2010, Kaffee
filed a motion to withdraw his Informal Objection.30
7. Discussion. We dismiss the Alpine Petition for lack of standing. Section 1.939(f) of the
Commission's Rules requires that a petition to deny contain specific allegations of fact sufficient to make
a prima facie showing that the petitioner is a party in interest and that a grant of the application would be
inconsistent with the public interest, convenience and necessity.31 To establish standing as a party in
interest, a petitioner must allege facts sufficient to demonstrate that grant of the subject application would
cause it to suffer a direct injury.32 In addition, a petitioner must demonstrate a causal link between the
claimed injury and the challenged action,33 and that any injury would be redressable by the relief
requested.34 When evaluating standing, the Commission applies the same test that courts employ in
determining whether a person has standing under Article III to appeal a court order: the person must
show "(a) a personal injury-in-fact that is (2) `fairly traceable' to the defendant's conduct and
(3) redressable by the relief requested."35
8. To show standing, Alpine asserts that it continues to have interests in the licenses it won in
Auction 5 for the same spectrum Club 42 applied for and won in Auction 78, because Alpine's
(1) petition for reconsideration of the Commission's denial of Alpine's automatic cancellation rules
waiver request, and (2) appeal of the Bankruptcy Court's denial of Alpine's motion to enforce the
automatic stay against the Commission were still pending at the commencement of this proceeding.36 As
stated above, however, both of these proceedings have now been concluded, and the original decisions
denying the waiver request and motion to stay have been affirmed. The fact remains that, upon the
automatic cancellation of Alpine's licenses in 2002, i.e. six years prior to the commencement of Auction
78, the licenses ceased to exist, along with Alpine's interest in the spectrum for which the licenses were
issued.37
9. Cancellation of Alpine's licenses has no connection with the conduct of Club 42, and the
Commission's denial of Club 42's "long-form" application in Auction 78 could not result in the


(...continued from previous page)
29 Id. at 13.
30 See generally Kaffee Withdrawal Motion.
31 47 C.F.R. 1.939(f).
32 See, e.g., Petition for Reconsideration of Various Auction 87 Public Notices, et al., 27 FCC Rcd 4374, 4382 21
(WTB MD & ASAD 2012 ("Auction 87 Order"); AT&T PCS Wireless PCS, Inc., Order, 15 FCC Rcd 4587, 4588
3 (WTB CWD 2000) ("AT&T Wireless"), citing Sierra Club v. Morton, 405 U.S. 727, 733 (1972); Lawrence N.
Brandt, Memorandum Opinion and Order, 3 FCC Rcd 4082 (1988).
33 Auction 87 Order, 27 FCC Rcd at 4382 21; AT&T Wireless, 15 FCC Rcd at 4588 3, citing Duke Power v.
Carolina Environmental Study Group, Inc.
, 438 U.S. 59, 72. 78 (1978).
34 Auction 87 Order, 27 FCC Rcd at 4382 21; Weblink Wireless, Inc., Memorandum Opinion and Order, 17 FCC
Rcd 24642 11 (2002).
35 See SunCom Mobile & Data, Inc. v. FCC, 87 F.3d 1386, 1387-88 (D.C. Cir. 1996) (quoting Branton v. FCC, 993
F.2d 906, 908 (D.C. Cir. 1993) (quoting Allen v. Wright, 468 U.S. 737, 751 (1984)), cert. denied, 511 U.S. 1052
(1994)).
36 See Petition at 6-7.
37 See, e.g., Thacker v. FCC, 503 F.3d 984, 990 (9th Cir. 2007), cert. denied 553 U.S. 1004 (2008) ("[O]nce [FCC]
licenses are cancelled for nonpayment, the licenses cease to exist along with any interest in the spectrum for which
the license was issued.")
4

Federal Communications Commission

DA 13-1341

reinstatement of Alpine's licenses or its interests therein. Therefore, Alpine does not have standing to file
its petition against the Application, and we will dismiss it.
10. As noted above, Kaffee filed his Withdrawal Motion on July 6, 2010. The Withdrawal
Motion explains that the Kaffee Informal Objection is being withdrawn pursuant to the terms of a "Qui
Tam
Settlement Agreement," dated June 16, 2010, in the federal False Claims Act case styled Stephen
Kaffee, et al. v. Raveesh K. Kumra, et al.
, Case No 07-0857 (United States District Court for the District
of Columbia).38 The Kaffee Withdrawal Motion states that Kaffee is not receiving any payments for the
withdrawal of his Informal Objection.39 In addition, in a Declaration accompanying the Kaffee
Withdrawal Motion, Kaffee declares, in accordance with the requirements of section 1.935 of the
Commission's rules,40 that he is not receiving any payment for the withdrawal of the Informal Objection.
Also as required by section 1.935, Club 42 submitted declarations supporting Kaffee's request to dismiss
his Informal Objection.41 In particular, Puneet Wadhwa and Raveesh K. Kumra each declare that Kaffee
is not receiving any payment from them or any other entity (specifically including Club 42) for
dismissing the Informal Objection. Based upon our review of the Kaffee Informal Objection, the Club 42
Informal Objection Opposition, the Kaffee Reply, the Kaffee Withdrawal Request and Kaffee's related
declaration under section 1.935, and the Club 42 Declarations also submitted pursuant to section 1.935,
we find that withdrawal of the Kaffee Informal Objection will further the public interest, and we will
approve the withdrawal.
11. Conclusion. For the reasons set forth above, we conclude that Alpine does not have standing
in this proceeding. Therefore, we will dismiss Alpine's Petition. Also for the reasons set forth above, we
approve the withdrawal of the Kaffee Informal Objection.
12. Accordingly, IT IS ORDERED, pursuant to sections 4(i) and 309 of the Communications Act
of 1934, as amended, 47 U.S.C. 154(i), 309, that the petition to deny filed by Alpine PCS, Inc. on
October 20, 2008, IS DISMISSED.
13. IT IS FURTHER ORDERED, pursuant to sections 4(i) and 309 of the Communications Act
of 1934, as amended, 47 U.S.C. 154(i), 309 and sections 1.41 and 1.935 of the Commission's Rules, 47
C.F.R. 1.41, 1.935 that the informal objection filed by Stephen Kaffee on October 20, 2008, IS
DISMISSED.
14. IT IS FURTHER ORDERED, pursuant to sections 4(i) and 309 of the Communications Act
of 1934, as amended, 47 U.S.C. 154(i), 309, that the staff of the Mobility Division of the Wireless
Telecommunications Bureau SHALL PROCESS application ULS File No. 0003573589 consistent with
this Order and the Commission's Rules.


38 Kaffee Withdrawal Motion at 1. The Kaffee Withdrawal Motion further states that the settlement agreement was
approved by the Department of Justice and the Federal Communications Commission on or about June 25, 2010. Id.
39 Id. at 3.
40 47 C.F.R. 1.935.
41 See Club 42 Declarations.
5

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15. This action is taken under delegated authority pursuant to Sections 0.131 and 0.331 of the
Commission's Rules, 47 C.F.R. 0.131, 0.331.
FEDERAL COMMUNICATIONS COMMISSION
Katherine M. Harris
Deputy Chief, Mobility Division
Wireless Telecommunications Bureau
6

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