Before the

**Federal Communications Commission**

**Washington, D.C. 20554**

+----------------------------------+----+------------------------------+
| In the Matter of                 | *  | WC Docket No. 06-106         |
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| Motient Corporation and          | ** | File Nos.                    |
| Subsidiaries, Transferors,       |    | ITC-T/C-20060518-00283       |
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| and                              | *) | SAT-T/C-20060517-00062       |
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| SkyTerra Communications, Inc.,   |    | SES-T/C-20060517-00828/829   |
| Transferee,                      | *  |                              |
|                                  | *) | 0020-EX-TC-2006              |
| Application for Authority to     | ** |                              |
| Transfer Control of Mobile       |    |                              |
| Satellite Ventures Subsidiary    | *  |                              |
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+----------------------------------+----+------------------------------+

**MEMORANDUM OPINION AND ORDER AND DECLARATORY RULING**

**Adopted: September 15, 2006 Released: September 15, 2006**

By the Acting Chief, International Bureau; Chief, Wireline Competition
Bureau; and Acting Chief, Office of Engineering and Technology

# introduction

1.  In this *Memorandum Opinion and Order and Declaratory Ruling*, we
    consider an application filed by Motient Corporation and
    subsidiaries ("Motient") and SkyTerra Communications, Inc.
    ("SkyTerra," and together with Motient, the "Applicants") for
    consent to transfer control of Commission licenses and
    authorizations held by Mobile Satellite Ventures Subsidiary LLC
    ("MSV") from Motient to SkyTerra (the "Application").[^1] The
    licenses and authorizations consist of international and domestic
    section 214 authorizations, satellite space station licenses,
    satellite earth station licenses, and an experimental license.[^2]
    Based on the record established in this proceeding, we find that
    grant of this Application will serve the public interest,
    convenience and necessity.

# background

## The Current Ownership Structure

2.  MSV, the current holder of the FCC authorizations and licenses that
    are the subject of the transfer of control Application, operates a
    Mobile Satellite Service (MSS) system in the L-band and is planning
    a next generation system.[^3] MSV, a Delaware limited liability
    company, is a direct wholly-owned subsidiary of Mobile Satellite
    Ventures LP ("MSV LP"), a Delaware limited partnership. The general
    partner of MSV LP is Mobile Satellite Ventures GP Inc. ("MSV GP"), a
    Delaware corporation. The limited partners of MSV LP consist of
    affiliates of the following entities: (i) Motient (the transferor
    under the Application); (ii) MSV Investors, LLC ("MSV Investors"),
    an 80%-owned subsidiary of SkyTerra (the transferee under the
    Application); (iii) TMI Communications and Company, Limited
    Partnership ("TMI"); (iv) Columbia Capital; and (v) Spectrum
    Equity.[^4] These limited partners are also the stockholders of MSV
    GP. According to the Application, the existing ownership and control
    structure of MSV is set forth in the following table:[^5]

  -------------------------------------- --------------- ----------------
                                         MSV GP (voting  MSV LP (equity
                                         interest in     interest in MSV)
                                         MSV)            

  Motient, the transferor                45.2%           45.1%

  MSV Investors                          22.8%           22.8%

  TMI                                    21.8%           21.8%

  Funds affiliated with Columbia Capital 7.8%            7.8%

  Funds affiliated with Spectrum Equity  2.3%            2.3%
  -------------------------------------- --------------- ----------------

3.  The five entities whose affiliates comprise the MSV LP limited
    partners also hold interests in TerreStar Networks, Inc.
    ("TerreStar"). TerreStar is developing a spot beam satellite network
    in the 2 GHz MSS band to provide diverse services to mobile and
    transportable terminals, including handheld devices,[^6] and is the
    proposed assignee of TMI's authorization to provide 2 GHz MSS to the
    United States.[^7] Specifically, Motient holds 60.9%, MSV Investors
    holds 16.5%, TMI holds 15.8%, and the Columbia/Spectrum investors
    jointly hold an approximately 4.9% interest in TerreStar.[^8]

4.  SkyTerra, the proposed transferee, presently owns 80% of MSV
    Investors, LLC, which translates into a 22.8% indirect voting and an
    18.2% indirect equity interest in MSV, and a 14.7% indirect interest
    in TerreStar.[^9] SkyTerra is a publicly-traded Delaware corporation
    currently controlled by funds affiliated with Apollo Advisors, L.P.,
    a/k/a Apollo Management.[^10] The individuals or entities with a 10%
    or greater interest in SkyTerra are Apollo Investment Fund IV, L.P.
    (approximately 54%) and Harbinger Capital Partners Master Fund I,
    Ltd. (approximately 13%).[^11]

## The Proposed Transaction

5.  The proposed transaction is part of an overall plan by Motient and
    other owners of MSV and TerreStar to realign the ownership of MSV
    and TerreStar. The purpose of the instant Application is to
    consolidate the ownership and control of MSV LP and MSV GP under
    SkyTerra, as follows:[^12]

  --------------------------------------- ---------------- --------------
                                          MSV GP (voting   MSV LP (equity
                                          interest in MSV) interest in
                                                           MSV)

  SkyTerra, the transferee                78.2%            58.8%

  TMI                                     21.8%            21.8%

  Motient                                 0%               19.2%
  --------------------------------------- ---------------- --------------

In a related part of the overall plan, which is not before us in the
instant Application, Motient will increase its control of TerreStar to
approximately 74%, while SkyTerra will exchange its 14.7% indirect
interest in TerreStar for an approximately 12% direct interest in
TerreStar, and TMI will retain an approximately 14% interest in
TerreStar.[^13]

6.  The transaction before us involves a two-step exchange between
    SkyTerra and four out of the five limited partner groups of MSV LP
    (all but TMI). The first step in the exchange involves SkyTerra
    issuing to Motient non-voting SkyTerra common stock in exchange for
    all of Motient's interests in MSV GP and a majority of Motient's
    interests in MSV LP (the "Motient Exchange").[^14] Through similar
    arrangements, SkyTerra will issue SkyTerra voting common stock to
    MSV Investors, Columbia Capital, and Spectrum Equity in exchange for
    the interests of these entities' affiliates in MSV GP and MSV LP
    (the "Investor Exchange," and together with the Motient Exchange,
    the "Initial Exchange").[^15] The Applicants state that the second
    part of the exchange will occur when the SkyTerra non-voting stock
    issued to Motient will be distributed by way of a dividend to
    Motient's stockholders (the "Motient Dividend").[^16] Upon such
    distribution, the Applicants advise that the non-voting stock will
    convert into SkyTerra voting stock.[^17] Motient anticipates that
    the Motient Dividend will be made within two to four months after
    the Initial Exchange.[^18]

7.  After consummation of these transactions, SkyTerra will control MSV
    and will hold the majority of the equity interests in MSV. The
    Applicants state that no single shareholder will have a 50% or
    greater equity or voting interest in SkyTerra, and that five funds
    affiliated with Apollo Management (Apollo Investment Fund IV, L.P.,
    Apollo Overseas Partners IV, L.P., AIF IV/RRRR LLC, AP/RM
    Acquisition LLC and ST/RRRR, LLC, and collectively, the "Apollo
    Funds") will be the only individual or entity to hold a 10% or
    greater equity or voting interest in SkyTerra.[^19] Mr. Leon D.
    Black, a U.S. citizen, ultimately controls the Apollo Funds' voting
    interests in SkyTerra through a series of intermediate subsidiaries
    and management arrangements.[^20]

## Comments on the Application

8.  The Application was placed on Public Notice on June 16, 2006.[^21]
    The Commission received filings from two parties in response to the
    Public Notice: (1) the U.S. Department of Justice ("DOJ"), including
    the Federal Bureau of Investigation ("FBI"), with the concurrence of
    the U.S. Department of Homeland Security ("DHS," and together with
    DOJ/FBI, the "Executive Branch Entities"); and (2) Highland Capital
    Management, L.P. ("Highland").

9.  The Executive Branch Entities filed a letter on July 17, 2006 ("EB
    Letter"), requesting that the Commission defer action on the
    Application pending further review by the Executive Branch
    Entities.[^22] The EB Letter notifies the Commission that the
    Application raises potential national security, law enforcement, and
    public safety issues requiring the Executive Branch Entities'
    review. On August 25, 2006, the Executive Branch Entities filed a
    Petition to Adopt Conditions to Authorizations and Licenses
    ("Executive Branch Petition"), advising the Commission that they
    have no objection to the Commission granting the Application,
    provided that the Commission conditions the grant on compliance by
    the Applicants with the commitments and undertakings contained in an
    Agreement attached as Exhibit A to the Executive Branch Petition
    (the "Executive Branch Agreement").[^23]

10. Highland, one of Motient's shareholders,[^24] filed comments on the
    Application on July 18, 2006.[^25] Highland maintains that the
    Applicants' proposed transaction is not in the public interest,
    asserting that the Applicants have failed to provide sufficient
    factual support for the Commission to make a public interest
    determination.[^26] Highland argues that the Applicants have failed
    to meet their burden of demonstrating that the potential benefits of
    proposed transaction outweigh its potential harms.[^27] Accordingly,
    Highland requests that the Commission fully and completely
    investigate the public interest implications of the proposed
    transaction, including the potential impact on TerreStar and
    competition in the relevant market.[^28] In that regard, Highland
    claims that, due to the intertwined nature of the MSV and TerreStar
    transactions, the Commission should evaluate the impact of the
    transaction on MSV's build out of its L-band network and TerreStar's
    proposed build out of a 2 GHz MSS network.[^29] Specifically,
    Highland explains that, should TerreStar be assigned one of only two
    reservations of spectrum to provide 2 GHz MSS to U.S. consumers, it
    would be an important competitor in the globally-harmonized 2 GHz
    MSS market, and "given the market implications of the transaction,
    for public safety, homeland security and rural and other remote area
    services, the Commission should carefully evaluate the likely impact
    on both MSV *and* TerreStar of the proposed transaction before
    deciding whether to grant the pending Application."[^30]

11. Highland also claims that Motient is incurring a significant tax
    liability as a result of the proposed transaction that would render
    Motient illiquid and unable to fund TerreStar, thus eliminating a
    viable competitor in the MSS marketplace.[^31] In addition, Highland
    asserts that the Application contains no factual support for
    Motient's assertion that development of its integrated and
    terrestrial communications network will be facilitated by grant of
    the Application.[^32] Highland suggests that the Commission wait for
    information that may emerge from depositions and discovery being
    conducted in a civil lawsuit between Highland and Motient, which
    "should shed much light on the true nature of the transaction under
    consideration by the Commission."[^33] Finally, Highland requests
    that, if the Applicants fail to support the claims in their
    Application, the Commission should designate the Application for
    hearing.[^34]

12. Motient and SkyTerra filed oppositions to Highland's comments.[^35]
    Motient alleges that: (1) Highland has provided no information that
    is material to Commission review of the Application; (2) any
    potential impact on TerreStar is irrelevant to the Application; (3)
    the Applicants have demonstrated that the proposed transaction is in
    the public interest; and (4) the private dispute between Highland
    and Motient has no bearing on the public interest determination to
    be made by the Commission.[^36] SkyTerra argues that the
    Commission's application review process is not the proper forum for
    adjudication of civil litigation claims that do no implicate the
    Applicants' qualifications under the Communications Act of 1934, as
    amended (the "Act") or Commission rules.[^37] Moreover, SkyTerra
    rebuts Highland's public interest argument, maintaining that the MSS
    market is highly competitive, and that the transaction enhances
    competition by consolidating controlling ownership of MSV, noting
    that ownership of TerreStar is already consolidated under
    Motient.[^38]

13. In reply, Highland re-emphasizes that the Commission should make a
    full and complete investigation of the public interest implications
    of the proposed transaction.[^39] Highland contends that neither
    Motient nor SkyTerra explain and support their position that the
    proposed transaction will enable MSV to attract more capital,
    emphasizing that the proposed transaction will impact not just MSV,
    but also TerreStar, the partner of one of the two remaining
    U.S.-authorized service providers in the 2 GHz MSS bands.
    Specifically, Highland argues that the success or failure of
    TerreStar affects specific goals under the Act -- competition,
    national security, public safety and rural/remote access to
    communications services.[^40]

14. After the pleading cycle closed, Commission staff requested that the
    Applicants and representatives of TerreStar file supplemental
    information to ensure a full and complete record of the proposed
    transaction. In response, the Applicants and TerreStar collectively
    submitted eight *ex parte* letters that have been incorporated into
    the record on review.[^41]

# public interest analysis

## Framework of Analysis

15. Pursuant to sections 214(a) and 310(d) of the Act,[^42] the
    Commission must determine whether the proposed transfer of control
    to SkyTerra of licenses and authorizations held and controlled by
    MSV will serve the public interest, convenience, and necessity.[^43]
    In making this determination, we first assess whether the proposed
    transaction complies with the specific provisions of the Act, other
    applicable statutes, and the Commission's rules. If the proposed
    transaction would not violate a statute or rule, the Commission
    considers whether it could result in public interest harms by
    substantially frustrating or impairing the objectives or
    implementation of the Act or related statutes. The Commission then
    employs a balancing test weighing any potential public interest
    harms of the proposed transaction against the potential public
    interest benefits.[^44] The Applicants bear the burden of proving,
    by a preponderance of the evidence, that the proposed transaction,
    on balance, serves the public interest.[^45] If we are unable to
    find that the proposed transaction serves the public interest for
    any reason, or if the record presents a substantial and material
    question of fact, we may designate the application for hearing.[^46]

16. Our public interest evaluation necessarily encompasses the "broad
    aims of the Communications Act,"[^47] which include, among other
    things, a deeply rooted preference for preserving and enhancing
    competition in relevant markets, accelerating private sector
    deployment of advanced services, ensuring a diversity of license
    holdings, and generally managing the spectrum in the public
    interest.[^48] Our public interest analysis may also entail
    assessing whether the proposed transaction will affect the quality
    of communications services or will result in the provision of new or
    additional services to consumers.[^49] In conducting this analysis,
    the Commission may consider technological and market changes, and
    the nature, complexity, and speed of change of, as well as trends
    within, the communications industry.[^50]

17. Our analysis starts with an examination of whether the Applicants
    are qualified to hold and assign licenses pursuant to sections
    214(a) and 310(d) of the Act.[^51] Next, we consider the arguments
    raised by Highland regarding the potential harms and benefits of the
    proposed transaction, as well as its effects on competition. Then we
    consider foreign ownership issues. Finally, we consider issues
    related to national security, law enforcement, foreign policy, and
    trade policy.

## Qualifications of the Applicants

18. As a threshold matter, we must determine whether the Applicants meet
    the requisite qualifications to hold and transfer licenses under
    section 310(d) of the Act and the Commission's rules. In general,
    when evaluating assignments under section 310(d), we do not
    re-evaluate the qualifications of the transferor.[^52] The exception
    to this rule occurs where issues related to basic qualifications
    have been designated for hearing by the Commission or have been
    sufficiently raised in petitions to warrant the designation of a
    hearing.[^53] This is not the case here, so we need not re-evaluate
    Motient's basic qualifications.

19. Section 310(d) also requires that the Commission consider the
    qualifications of the proposed transferee as if the transferee were
    applying for the license directly under section 308 of the Act.[^54]
    We note that no party has challenged SkyTerra's basic
    qualifications, and nothing has come to our attention that would
    disqualify SkyTerra on the grounds that it lacks the technical,
    legal, or other basic qualifications necessary to be a Commission
    licensee. Thus, we find that SkyTerra possesses the requisite basic
    qualifications to be a Commission licensee.

## Potential Harms/Benefits

20. Highland contends that the proposed transaction will adversely
    affect both MSV and TerreStar. Highland argues that the Applicants
    have not provided supporting information that demonstrates the
    alleged benefits of the transaction outweigh potential harms, and
    therefore, have failed to satisfy their burden of demonstrating that
    the transaction is in the public interest.[^55] It therefore
    maintains that the Commission should conduct a full and complete
    investigation of the public interest implications of the transaction
    by, for example, awaiting completion of discovery in a related civil
    lawsuit.[^56] Commission staff responded to Highland's concerns by
    requesting that the Applicants answer questions regarding the
    transaction, many of which paralleled those set forth in Highland's
    comments.[^57]

21. We find, based on the record before us, that the public interest
    benefits of the transaction outweigh the alleged harms claimed by
    Highland. We conclude that the Applicants have met their burden in
    demonstrating that the proposed transaction will serve the public
    interest. As a result, there is no need to delay action on the
    Application pending receipt of additional information from the
    discovery phase of the pending civil lawsuit.[^58]

22. In the Application, the Applicants claim that the transaction will
    facilitate MSV's development of its planned integrated satellite and
    terrestrial network that will provide broadband services in North
    America. They assert that, as a result of the transaction, MSV will
    be controlled by a publicly-traded company, SkyTerra, thereby
    enabling MSV to more easily attract capital and engage in
    arrangements with potential strategic partners that are essential to
    development of MSV's next generation system.[^59] Highland
    criticizes these statements as conclusory and proffered without
    supporting information.[^60] Highland also points out that the
    Commission requires that claimed benefits to a transaction be
    transaction-specific and verifiable.[^61] Contrary to Highland's
    contentions, we find that the benefits claimed in the Application
    are specific to the transaction, and that the record developed in
    this proceeding provides sufficient evidence supporting the claimed
    benefits for us to credit them. We further find that such benefits
    outweigh any potential harms.

23. The realignment of the ownership structure of MSV and TerreStar is
    intended to result in each of the two companies being controlled by
    separate publicly-traded entities.[^62] Motient states that the
    proposed transaction will separate the ownership of MSV and
    TerreStar in a manner that will facilitate capital investment in
    TerreStar by enabling potential investors and banks to negotiate an
    investment or a loan with a single majority owner rather than
    negotiating with multiple parties, each with different demands and
    requirements.[^63] Motient later explains that MSV and TerreStar
    have two very different investment profiles, the former being an
    established licensed satellite operator, and the latter being a
    "greenfield" start-up. It asserts that each company, therefore,
    presents opportunities to equity investors, different debt
    providers, and different strategic partners, any of which might be
    opposed to investing in a co-owned situation with a mixed investment
    message and material cross-collateralization concerns. As a result,
    according to Motient, separating the ownership of the companies will
    generate interest from separate investor groups, making it possible
    for both companies' business plans to be financed more easily.[^64]
    Motient further points out that analysts, asked to review the
    proposed transaction, have concluded that the overall realignment
    plan would be beneficial for both Motient and TerreStar, a
    conclusion that Highland failed to rebut.[^65] SkyTerra adds that
    MSV will be in a better position to secure additional capital in
    order to deploy its next generation system, and to establish
    strategy arrangements to implement its business plan for that
    system, following consummation of the proposed transaction.[^66]

24. Highland has not articulated transaction-specific harms to MSV
    resulting from the proposed transaction before us. Its allegations
    of harm to TerreStar appear speculative and more a matter of
    business judgment.[^67] Highland questions whether TerreStar will
    continue to benefit from the intellectual property assets of MSV,
    expresses concern about the potential loss of MSV expertise in
    satellite communications, and alleges that TerreStar may be
    insufficiently funded because of a tax liability that MSV will incur
    as a result of the transaction.[^68] With respect to the first
    issue, the record reflects that, in the spring of 2005, the
    intellectual property held by MSV was transferred to a limited
    liability holding company, which is owned in equal shares by MSV and
    TerreStar.[^69] The co-owned holding company executed an irrevocable
    license agreement with MSV for its L-band use and with TerreStar for
    its use in the 2 GHz MSS band. Pursuant to these license agreements,
    MSV and TerreStar each has unencumbered access to all of the
    intellectual property each company needs, irrespective of the
    instant proposed transaction.[^70] As to the second issue, the
    record clearly reflects the background and experience of the
    TerreStar management team and Motient's intent to turn its attention
    predominantly to TerreStar and to the execution of its business
    plan.[^71] On these issues, we do not need to look beyond the
    information before us. As to the issue of TerreStar's future
    liquidity, the Commission no longer looks at financial
    qualifications for new providers, let alone in the context of an
    assignment or transfer.[^72] Finally, the TerreStar management,
    states that it has given careful consideration to and supports the
    proposed transaction.[^73]

25. Based upon the information provided by the Applicants, we find that
    the proposed transaction, as part of Motient's overall plan to
    realign the ownership of MSV and TerreStar, is designed to
    facilitate development of MSV's next generation satellite system and
    TerreStar's new satellite system by improving each entity's ability
    to attract the significant financing necessary for such development.
    The Applicants have articulated the purpose of the realignment and
    have shown that they are moving forward reasonably within the
    current corporate governance and ownership framework to effectuate
    their plans. The plan to realign ownership has been presented to the
    Motient shareholders, who elected a Motient board of directors that
    approved the plan.[^74] Further, Highland, as a Motient shareholder,
    has other avenues open to it should it believe that there is a
    breach of fiduciary duty on the part of the Motient board of
    directors. Commission proceedings are not the appropriate forum for
    the adjudication of shareholder disputes.[^75] We agree with the
    Applicants that, without specific allegations of harm by Highland,
    Commission precedent supports giving deference to the business
    judgments underlying the transaction.[^76]

26. Additionally, the record contains considerable discussion by the
    parties as to the effect of the lawsuit brought by Highland under,
    *inter alia*, the Investment Company Act of 1940, as amended.[^77]
    The Applicants contend that Highland is attempting to delay
    Commission action on the Application pending the outcome of that
    lawsuit. They argue that the lawsuit involves adjudication of a
    private dispute not relevant to this proceeding.[^78] They also
    argue that the Commission has authority to act upon the Application
    notwithstanding the pending lawsuit.[^79] Highland denies that it is
    seeking to defer Commission action pending the outcome of the
    litigation and states that its intent is to present facts and
    information concerning the proposed transaction to ensure a full and
    complete record upon which to base public interest findings.[^80]
    Highland agrees that the Commission has ample authority to make its
    public interest determination independent of the lawsuit.[^81] In
    view of our finding that the Applicants have demonstrated public
    interest benefits on the record before us, there is no need to delay
    action on the Application pending additional information that may
    result from the discovery phase of the court proceeding.

## Effect on Competition

27. Part of the Commission's public interest analysis considers the
    competitive effect of the transaction. To evaluate the competitive
    effects of a transaction, the Commission first identifies the
    relevant product and geographic markets.[^82] For satellite service
    providers, generally, the Commission has determined that the
    relevant product markets include domestic and international
    telecommunications markets.[^83] For MSS providers, it has been
    determined that they compete in the same product markets.[^84] In
    examining the MSS product markets, we consider whether the proposed
    transaction will lessen or enhance competition in the provision of
    communications services within the markets in, to, or from the
    United States and foreign points.[^85]

28. In the United States, several MSS providers operating in different
    bands offer multiple products including voice and data services in
    fixed and mobile environments to a variety of terminals (*e.g.*,
    hand-held terminals, or laptop-sized and larger terminals that can
    be transported from one location to another). In addition to MSV,
    Inmarsat Ventures Ltd. also provides voice and data communications
    via satellite in the L-band. Both Globalstar Licensee LLC and
    Iridium Satellite LLC are using Big LEO MSS licenses to offer mobile
    voice and data services.[^86] ICO and TMI currently have spectrum
    reserved for their use to provide MSS to U.S. consumers in the 2 GHz
    MSS bands, though neither has yet begun commercial service. As noted
    above, TMI has an application pending before the Commission to
    assign its spectrum reservation to TerreStar.[^87]

29. The Application before us does not involve a merger of MSS providers
    that arguably may lessen competition. Rather, the Application seeks
    approval of a transaction that is part of the realignment of
    ownership of an existing provider planning a next generation
    satellite system, and a future provider developing a new system. In
    this respect, the competitive landscape described above is not
    changed. The only allegation of competitive harm on the record comes
    from Highland, which asks the Commission to carefully look at the
    competitive implications of the transaction as a result of harm that
    Highland alleges will accrue to MSV and TerreStar.[^88] However, as
    discussed above, the Applicants have identified benefits of the
    transaction designed to strengthen both MSV and TerreStar
    competitively, and we are not persuaded that the transaction is
    likely to be harmful to TerreStar. As a result, we find no basis to
    conclude that the proposed transaction is likely to harm
    competition.

## Foreign Ownership

30. In the Application, the Applicants request that the Commission
    approve the proposed transfer of control of MSV, a common carrier
    radio licensee, without issuing a declaratory ruling under section
    310(b)(4) of the Act that would specifically approve the indirect
    foreign equity and voting interests that will be held in MSV upon
    consummation of the proposed transaction.[^89] According to the
    Applicants, no foreign ownership ruling is necessary because MSV's
    indirect foreign equity and voting interests, including interests
    held by TMI, a Canadian limited partnership, will fall within the
    parameters of the foreign ownership ruling we issued to MSV in the
    *MSV 2001 Order*.[^90] At the time of the *MSV 2001 Order*, TMI
    proposed to acquire a 39.9% limited partnership interest in MSV LP
    and a 26.4% ownership interest in MSV GP, in excess of the 25%
    foreign ownership benchmark set forth in section 310(b)(4) of the
    Act.[^91] TMI presently holds a 21.8% limited partnership interest
    in MSV LP and a 21.8% ownership interest in MSV LP's general
    partner, MSV GP, which TMI will retain after consummation of the
    proposed transaction. While TMI's retained 21.8% equity and voting
    interests in MSV LP will fall within the parameters of the ruling we
    issued in the *MSV 2001 Order*, the transaction under consideration
    in the instant proceeding will nonetheless result in changes to the
    foreign equity and voting interests held indirectly in MSV through
    its parent partnership, MSV LP.

31. Based on the record before us, we find that MSV's indirect foreign
    voting interests will exceed, albeit by a modest amount, the foreign
    voting interests permitted under the existing foreign ownership
    ruling. We conclude, however, for the reasons stated below, that it
    would not serve the public interest to deny the transfer of control
    of the licenses and authorizations held by MSV because of the
    indirect foreign equity and voting interests that will be held in
    MSV LP. Therefore, on our own motion, we modify MSV's foreign
    ownership ruling originally issued in the *MSV 2001 Order* to
    approve specifically the foreign equity and voting interests that
    will be held indirectly in MSV by or through the Apollo Funds
    investing in SkyTerra.[^92]

32. We examine the foreign ownership interests that will be held in MSV
    LP pursuant to our public interest analysis under sections 310(b)(4)
    and 310(d) of the Act and the Commission's foreign ownership
    policies adopted in the *Foreign Participation Order*.[^93] As part
    of that analysis, we consider any national security, law
    enforcement, foreign policy, or trade policy concerns raised by the
    foreign investment.[^94] Relying on Commission precedent, we find
    that the proposed transfer of control does not raise any issues
    under sections 310(a) and 310(b)(1)-(b)(3) of the Act.[^95] Our
    analysis focuses on issues raised under section 310(b)(4).

### Legal Standard for Foreign Ownership of Radio Licenses

33. Section 310(b)(4) of the Act establishes a 25% benchmark for
    investment by foreign individuals, corporations, and governments in
    entities that control U.S. common carrier radio licensees. This
    section also grants the Commission discretion to allow higher levels
    of foreign ownership if it determines that such ownership is not
    inconsistent with the public interest.[^96]

34. The calculation of foreign ownership interests under section
    310(b)(4) is a two-pronged analysis in which the Commission examines
    separately the equity interests and the voting interests in the
    licensee's direct or indirect parent.[^97] The Commission calculates
    the equity interest of each foreign investor in the parent and then
    aggregates these interests to determine whether the sum of the
    foreign equity interests exceeds the statutory benchmark. Similarly,
    the Commission calculates the voting interest of each foreign
    investor in the parent and aggregates these voting interests.[^98]
    The presence of aggregated alien equity or voting interests in a
    common carrier licensee's parent in excess of 25% triggers the
    applicability of section 310(b)(4)'s statutory benchmark.[^99] Once
    the benchmark is triggered, section 310(b)(4) directs the Commission
    to determine whether the "public interest will be served by the
    refusal or revocation of such license."[^100]

35. In the *Foreign Participation Order*, the Commission concluded that
    the public interest would be served by permitting greater investment
    by individuals or entities from World Trade Organization ("WTO")
    Member countries in U.S. common carrier and aeronautical fixed and
    en route radio licensees.[^101] Therefore, with respect to indirect
    foreign investment from WTO Members, the Commission replaced its
    "effective competitive opportunities," or "ECO," test with a
    rebuttable presumption that such investment generally raises no
    competitive concerns.[^102] In evaluating an applicant's request for
    approval of foreign ownership interests under section 310(b)(4), the
    Commission uses a "principal place of business" test to determine
    the nationality or "home market" of foreign investors.[^103]

36. In light of the policies adopted in the *Foreign Participation
    Order*, we begin our evaluation of MSV's indirect foreign ownership
    under section 310(b)(4) by calculating the foreign equity and voting
    interests in MSV LP, the U.S. parent of MSV. We then determine
    whether these foreign interests properly are ascribed to individuals
    or entities that are citizens of, or have their principal places of
    business in, WTO Member countries. The Commission stated, in the
    *Foreign Participation Order*, that it will deny an application if
    it finds that more than 25% of the ownership of an entity that
    controls a common carrier radio licensee is attributable to parties
    whose principal place(s) of business are in non-WTO Member countries
    that do not offer effective competitive opportunities to U.S.
    investors in the particular service sector in which the applicant
    seeks to compete in the U.S. market, unless other public interest
    considerations outweigh that finding.[^104]

37. In *Wilner & Scheiner I* and its progeny, the Commission has set
    forth a standard for calculating both alien equity and voting
    interests held in a licensee or in the licensee's direct or indirect
    parent where such interests are held through intervening
    entities.[^105] In calculating attributable alien equity interests
    in a parent company, the Commission uses a multiplier to dilute the
    percentage of each investor's equity interest in the parent company
    when those interests are held through intervening companies. The
    multiplier is applied to each link in the vertical ownership chain,
    regardless of whether any particular link in the chain represents a
    controlling interest in the company positioned in the next lower
    tier.[^106] Once the *pro rata* equity interests of each alien
    investor are calculated, these interests then are aggregated to
    determine whether the sum of the interests exceeds the statutory
    benchmark.[^107]

38. By contrast, in calculating alien voting interests in a parent
    company, the multiplier is not applied to any link in the vertical
    ownership chain that constitutes a controlling interest in the
    company positioned in the next lower tier.[^108] In circumstances
    where voting interests in the U.S. parent of a common carrier
    licensee are held through intervening partnerships, the multiplier
    is not applied to dilute a general partnership interest or
    uninsulated limited partnership interest held by a foreign
    individual or entity. A general partner is considered to hold the
    same voting interest as the partnership holds in the company
    situated in the next lower tier of the vertical ownership chain.
    Similarly, in the absence of a specific demonstration that a limited
    partner effectively is insulated from active involvement in
    partnership affairs, a limited partner will be deemed to hold the
    same voting interest as the partnership holds in the company in the
    next lower tier of the vertical ownership chain.[^109] Thus, when
    evaluating foreign voting interests in the U.S. parent company of a
    common carrier licensee, it is possible that multiple investors will
    be treated as holding the same voting interest in a U.S. parent
    company where the investment is held through multiple intervening
    holding companies or partnerships. Our purpose in identifying the
    citizenship of the specific individuals or entities that hold these
    interests is not to increase the aggregate level of foreign
    investment, but rather to determine whether any particular interest
    that a foreign investor proposes to acquire raises potential risks
    to competition or other public interest concerns, such as national
    security or law enforcement concerns.[^110]

### Attribution of Foreign Ownership Interests 

39. As indicated in Section II.B. above, more than 99% of the limited
    partnership interests in MSV LP, a Delaware limited partnership,
    will be held by SkyTerra (58.8%), TMI (21.8%) and Motient
    (19.2%).[^111] All of MSV LP's economic interests will be held by
    its limited partners,[^112] and none will be held by MSV GP, a
    Delaware corporation that is MSV LP's general partner. All of the
    ownership interests in MSV GP will be held by SkyTerra (78.2%) and
    TMI (21.8%). As represented by the Applicants, SkyTerra will hold
    voting control of MSV LP by virtue of SkyTerra's majority voting
    interest in MSV GP.

40. Based on the information and representations submitted by the
    Applicants, and consistent with the foreign ownership case precedent
    discussed in Section III.E.1, we calculate below the foreign equity
    and voting interests that will be held in MSV LP, directly or
    indirectly, by or through its limited partners and its general
    partner, MSV GP. We find that TMI, a Canadian limited partnership,
    will hold a 21.8% equity interest and a 21.8% voting interest in MSV
    LP (based on TMI's 21.8% limited partnership interest in MSV LP and
    its 21.8% ownership interest in MSV GP). Turning next to SkyTerra, a
    publicly-traded Delaware corporation, we find that foreign
    individuals and entities will hold through SkyTerra an aggregate
    13.23% equity interest and 22.00% voting interest in MSV LP (based
    on SkyTerra's 58.8% limited partnership interest in MSV LP and its
    controlling 78.2% ownership interest in MSV GP).[^113] Our final
    calculation is for Motient, a publicly-traded Delaware corporation.
    After giving effect to the Initial Exchange, Motient will hold
    directly a 19.2% limited partnership interest in MSV LP but will
    hold no ownership interest in MSV LP's general partner, MSV GP. We
    find that foreign-held shares in Motient represent a 5.57% foreign
    equity interest in MSV LP (based on Motient's 19.2% limited
    partnership interest in MSV LP).[^114]

41. Although Motient will not hold any ownership interest in MSV GP, the
    record indicates that foreign individuals or entities hold 17.3% of
    Motient's issued and outstanding shares of common stock. The
    beneficial owners of these shares are also entitled to vote the
    shares.[^115] As noted, Motient will have no voting rights in MSV
    GP, and the Applicants state that all of MSV LP's voting rights in
    MSV, the licensee, will be exercised by MSV GP.[^116] The
    Applicants, however, have not provided for the record organizational
    or other governance documents that would allow us to determine
    whether or to what extent any of MSV LP's limited partners have
    voting rights as to particular matters affecting their investments
    in MSV LP or whether any of the limited partners otherwise have the
    power to control or direct the policies of MSV LP, which is the sole
    member of MSV, the common carrier licensee in this case. In the
    absence of such evidence, we calculate a foreign voting interest
    based on Motient's 19.2% limited partnership interest in MSV LP. We
    apply the multiplier to calculate Motient's foreign voting interest
    in MSV LP, recognizing that Motient will hold directly only a
    minority share of the limited partnership interests in MSV LP and
    that SkyTerra, by contrast, will hold a majority of the equity
    interests in MSV LP and the voting interests in MSV GP.[^117] On
    this basis, we find that foreign-held voting shares in Motient
    (17.3%) represent a 3.32% foreign voting interest in MSV LP (17.3% x
    19.2%).

42. We next add the foreign equity and voting interests that will be
    held in MSV LP by and through its limited partners and its general
    partner, MSV GP. We calculate a total 40.60% foreign equity interest
    and a total 47.12% foreign voting interest. As discussed in
    paragraph 30 above, we previously approved indirect foreign
    ownership of MSV LP by TMI in the *MSV 2001 Order*. Specifically,
    the ruling "permits \[MSV\] to be owned indirectly by TMI and/or BCE
    Inc. and their Canadian shareholders in an amount up to and
    including an equity and/or voting interest of 40 percent."[^118]
    Based on the information in the record of the instant proceeding, we
    find that TMI's 21.8% equity interest in MSV LP and its 21.8% voting
    interest in MSV LP's general partner, MSV GP, continue to be
    properly ascribed to Canada, a WTO Member country.[^119] We also
    note that the Applicants have stated for the record that only 0.1%
    of BCE Inc. shares are held by non-U.S., non-Canadian
    shareholders.[^120]

43. We find that the majority of the remaining 18.80% foreign equity
    interests and 25.32% foreign voting interests that will be held in
    MSV LP, through SkyTerra and Motient, are also properly ascribed to
    WTO Member countries.[^121] The total 25.32% foreign voting interest
    that will be held in MSV LP through SkyTerra and Motient, however,
    will exceed the 25% aggregate amount that we authorized in the *MSV
    2001 Order* for unidentified foreign equity and/or voting interests
    in MSV.[^122] Specifically, the ruling requires MSV to obtain
    Commission approval before foreign individuals or entities other
    than TMI and/or BCE Inc. and their Canadian shareholders acquire
    individually and/or in the aggregate a greater than 25% indirect
    equity and/or voting interest in MSV.[^123] For purposes of
    calculating this additional aggregate amount, the ruling requires
    that MSV include *all* foreign equity and voting interests that it
    did not specifically identify in the record of the *MSV 2001*
    proceeding, including "foreign owners of Motient Corp., Columbia
    Capital, Spectrum Equity, MSV Investors, LLC and non-U.S.,
    non-Canadian owners of TMI and BCE Inc."[^124] Thus, in order to
    comply with the 25% allowance for unidentified foreign investment,
    MSV must include the 18.80% foreign equity interests and the 25.32%
    foreign voting interests that will be held in MSV LP through
    SkyTerra and Motient. It must also include the 0.02% equity and
    voting interests that will be held indirectly in MSV LP by BCE
    Inc.'s non-U.S., non-Canadian shareholders.[^125] Thus, we find that
    MSV will have, upon closing of the proposed transaction, 18.82%
    foreign equity interests and 25.34% foreign voting interests that we
    did not specifically approve in the *MSV 2001 Order*. Based upon
    these calculations, we find that the proposed transaction would not
    comport with MSV's existing foreign ownership ruling because MSV's
    indirect foreign voting interests will exceed the foreign voting
    interests permitted under the existing foreign ownership
    ruling.[^126]

44. We find, however, that it would not serve the public interest to
    deny the transfer of control of the licenses and authorizations held
    by MSV because of the indirect foreign equity and voting interests
    that will be held in MSV LP. Accordingly, on our own motion, we
    modify MSV's foreign ownership ruling based on the foregoing
    analysis of the foreign equity and voting interests that will be
    held in MSV indirectly as a result of the proposed transaction. The
    record indicates that the vast majority of the foreign equity and
    voting interests that will be held indirectly in MSV are properly
    ascribed to WTO Member countries. MSV is therefore entitled to a
    rebuttable presumption that its indirect foreign ownership would not
    pose a risk to competition in the U.S. market. We find no evidence
    in the record that rebuts this presumption and, as we explain in
    Section III.D., we find no basis to conclude that the proposed
    transaction is likely to harm competition.[^127] We also determine
    in Section III.F. below that the Executive Branch Agreement among
    the Executive Branch Entities and the Applicants addresses any
    national security and law enforcement concerns.[^128]

45. The ruling that we issue to MSV in this transfer of control
    proceeding approves specifically the 2.15% foreign equity interest
    and the 3.74% foreign voting interest that will be held by the
    following Apollo Funds indirectly in MSV through SkyTerra:[^129]
    Apollo Investment Fund IV, L.P.; Apollo Overseas Partners IV, L.P.;
    AP/RM Acquisition, LLC; AIF/RRRR, LLC; and ST/RRRR, LLC. Based on
    the information submitted by the Applicants, we find that all of
    this investment is properly ascribed to WTO Member countries.[^130]
    Our specific approval of the Apollo Fund foreign interests will
    enable MSV to comply with the additional, aggregate 25% amount that
    the foreign ownership ruling allows for unidentified foreign equity
    and/or voting interests.[^131] The ruling below also maintains the
    approval we granted in the *MSV 2001 Order* for indirect foreign
    investment by TMI and/or BCE Inc. and their Canadian shareholders up
    to and including an equity and/or voting interest of 40%. As noted,
    TMI will hold only an indirect 21.8% equity and voting interest in
    MSV. We find no basis on this record, however, to reduce the level
    of investment previously approved for TMI in the *MSV 2001 Order*.

### Declaratory Ruling

46. Accordingly, this declaratory ruling permits MSV to be owned
    indirectly by TMI and/or BCE Inc. and their Canadian shareholders
    (up to and including an equity and/or voting interest of 40%); and
    the named Apollo Funds and their foreign limited partners and
    members (up to and including a 2.15% equity interest and a 3.74%
    voting interest). MSV may accept up to and including an additional
    aggregate 25% indirect foreign equity and/or voting interests from
    these foreign investors and other foreign investors without seeking
    prior Commission approval under section 310(b)(4), subject to three
    conditions. First, for purposes of calculating the aggregate 25%
    amount, MSV shall include non-U.S., non-Canadian owners of TMI and
    BCE Inc., additional foreign equity and/or voting interests acquired
    by or through the named Apollo Funds; foreign equity and/or voting
    interests held through Motient and SkyTerra, and any other foreign
    equity and/or voting interests acquired indirectly in MSV through
    MSV LP. Second, MSV shall obtain prior Commission approval before
    any foreign individual or entity other than TMI or BCE (or their
    Canadian holding companies) acquires individually an indirect equity
    and/or voting interest in MSV that exceeds 25%. Third, MSV shall
    obtain prior Commission approval before its direct or indirect
    equity and/or voting interests from non-WTO Member countries exceeds
    25%. In calculating the 25% amount for non-WTO Member investment,
    MSV shall include non-WTO Member investment from any source,
    including interests held through TMI, the Apollo Funds, SkyTerra and
    Motient. We emphasize that, as a Commission licensee, MSV has an
    affirmative duty to continue to monitor its foreign equity and
    voting interests and to calculate these interests consistent with
    the attribution principles enunciated by the Commission.[^132]

## National Security, Law Enforcement, Foreign Policy and Trade Concerns

47. When analyzing a transfer of control or assignment application in
    which foreign investment is involved, we also consider any national
    security, law enforcement, foreign policy, or trade policy concerns
    raised by the Executive Branch.[^133] As noted above, the Executive
    Branch Agreement among the Executive Branch Entities and the
    Applicants addresses Executive Branch national security, law
    enforcement, and public safety concerns about the MSV system.[^134]

48. In the Executive Branch Agreement, SkyTerra and MSV agree that,
    following consummation of the proposed transfer of control of MSV to
    SkyTerra, SkyTerra and MSV will continue to abide and be bound by,
    and to comply with, the terms, conditions, and requirements of an
    Agreement, dated November 14, 2001, by and among MSV, Motient, TMI,
    the DOJ and the FBI.[^135] The Executive Branch Petition states that
    the Executive Branch Entities have taken the position that their
    ability to satisfy their obligations to protect the national
    security, enforce the laws, and preserve the safety of the public
    could be impaired by transactions in which foreign entities will own
    or operate a part of the U.S. telecommunications system, or in which
    foreign-located facilities will be used to provide domestic
    telecommunications services to U.S. customers.[^136] After
    discussions with the Applicants, the Executive Branch Entities have
    concluded that the commitments set forth in the Executive Branch
    Agreement address their concerns, and therefore asked the Commission
    to condition the grant on the Applicant's compliance with the
    commitments set forth in the letter.[^137]

49. In assessing the public interest, we take into account the record
    and accord deference to Executive Branch expertise on national
    security and law enforcement issues.[^138] As the Commission stated
    in the *Foreign Participation Order*, foreign participation in the
    U.S. telecommunications market may implicate significant national
    security or law enforcement issues uniquely within the expertise of
    the Executive Branch.[^139] In accordance with the request of the
    Executive Branch Entities, in the absence of any objection from the
    Applicants, and given the discussion above, we condition our grant
    of the Application on Applicant's compliance with the commitments
    set forth in the Executive Branch Agreement. We include the
    Executive Branch Petition and the Executive Branch Agreement as
    Appendix B to this *Memorandum Opinion and Order and Declaratory
    Ruling*.

# CONCLUSION

50. Upon review of the Application and the record in this proceeding, we
    find that, based on the conditions specified below, grant of the
    Application for consent to transfer control of Commission licenses
    and authorizations held by MSV from Motient to SkyTerra will serve
    the public interest. Further, based on the foregoing findings and
    pursuant to section 310(b)(4) of the Act and the Commission's
    precedent for indirect investment by WTO Members in U.S. common
    carrier licensees, we conclude that it would not serve the public
    interest to prohibit the indirect foreign ownership of MSV**,**
    subject to the limitations specified in paragraph 46 above. We
    condition grant of the Application on Applicant's compliance with
    commitments to the DOJ, FBI and DHS as specified below.

# Ordering Clauses

51. Accordingly, having reviewed the Application, the comments, and the
    record in this matter, IT IS ORDERED that, pursuant to sections 4(i)
    and (j), 214(a), 309, and 310(d) of the Communications Act of 1934,
    as amended, 47 U.S.C. §§ 154(i), 154(j), 214(a), 309, 310(d), the
    Application for consent to transfer of control of the licenses and
    authorizations identified in Appendix A from Motient Corporation and
    subsidiaries to SkyTerra Communications, Inc. IS GRANTED.

52. IT IS FURTHER ORDERED that, pursuant to sections 4(i) and (j), 309,
    and 310(b) and (d) of the Communications Act of 1934, as amended, 47
    U.S.C. §§ 154(i), 154(j), 309, 310(b), 310(d), the Petition to Adopt
    Conditions to Authorizations and Licenses filed jointly by the U.S.
    Department of Justice, the Federal Bureau of Investigation, and the
    U.S. Department of Homeland Security on August 25, 2006 IS GRANTED.
    Grant of the Application is conditioned upon compliance with the
    commitments set forth in the Executive Branch Agreement, attached to
    this *Memorandum Opinion and Order and Declaratory Ruling* as
    Appendix B.

53. IT IS FURTHER ORDERED that, pursuant to section 310(b)(4) of the
    Communications Act of 1934, as amended, 47 U.S.C. § 310(b)(4), and
    section 1.2 of the Commission's rules, 47 C.F.R. § 1.2, the foreign
    ownership ruling issued to Mobile Satellite Ventures Subsidiary LLC
    in *Motient Services Inc. and TMI Communications and Company, LP,
    Assignors and Mobile Satellite Ventures Subsidiary LLC, Assignee*,
    Order and Authorization, DA 01-2732, 16 FCC Rcd 20469, 20477 ¶ 22
    (Int'l Bur. 2001) IS MODIFIED to the extent specified in this
    *Memorandum Opinion and Order and Declaratory Ruling*.

54. IT IS FURTHER ORDERED that Highland Capital's Motion to Accept
    Late-Filed Comments IS GRANTED and Motient's Opposition to that
    Motion is DENIED.

55. This *Memorandum Opinion and Order and Declaratory Ruling* is issued
    pursuant to sections 0.241, 0.261 and 0.291 of the Commission's
    rules on delegations of authority, 47 C.F.R. §§ 0.241, 0.261, 0.291,
    and is effective upon release. Petitions for reconsideration under
    section 1.106 or applications for review under section 1.115 of the
    Commission's rules, 47 C.F.R. §§ 1.106, 1.115, may be filed within
    30 days of the date of the release of this *Memorandum Opinion and
    Order and Declaratory Ruling*. *See* 47 C.F.R. § 1.4(b)(2).

FEDERAL COMMUNICATIONS COMMISSION

######  John V. Giusti {#john-v.-giusti .unnumbered}

######  Acting Chief, International Bureau {#acting-chief-international-bureau .unnumbered}

Thomas Navin

Chief, Wireline Competition Bureau

Julius P. Knapp

Acting Chief, Office of Engineering and Technology

**[APPENDIX A]{.smallcaps}**

**SECTION 214 AUTHORIZATIONS**

**A. International**

**[File No.]{.underline} [Authorization Holder]{.underline}
[Authorization Number]{.underline}**

ITC-T/C-20060518-00283 Mobile Satellite Ventures ITC-214-19950314-00022

Subsidiary LLC ITC-214-19951215-00023

**B. Domestic**

**[Docket No.]{.underline} [Authorization Holder]{.underline}**

WC Docket No. 06-106 Mobile Satellite Ventures

Subsidiary LLC

**SECTION 310(D) AUTHORIZATIONS**

**A. Part 25-Satellite Earth Station Authorizations**

**[File No.]{.underline} [Licensee]{.underline} [Call
Sign]{.underline}**

SES-T/C-20060517-00828 Mobile Satellite Ventures E930124

Subsidiary LLC E940374

SES-T/C-20060517-00829 E930367

E980179

E990133

**B. Part 25-Satellite Space Station Authorizations**

**[File No.]{.underline} [Licensee]{.underline} [Call
Sign]{.underline}**

SAT-T/C-20060517-00062 Mobile Satellite Ventures AMSC-1 Subsidiary LLC
S2358

**Part 5-Experimental Radio Service (other than broadcast)
Authorization**

**[File No.]{.underline} [Licensee]{.underline} [Call
Sign]{.underline}**

0020-EX-TC-2006 Mobile Satellite Ventures WD2XNL

Subsidiary LLC

**[APPENDIX B]{.smallcaps}**

**\[Executive Branch Petition and Executive Branch Agreement\]**

[^1]: *See* Application for Authority to Transfer Control of Motient
    Corporation and Subsidiaries, Transferors, and SkyTerra
    Communications, Inc., Transferee, File Nos. ITC-T/C-20060518-00283,
    SAT-T/C-20060517-00062, SES-T/C-20060517-00828,
    SES-T/C-20060517-00829, 0020-EX-TC-2006 (filed May 17, 2006).

[^2]: Appendix A to this *Memorandum Opinion and Order and Declaratory
    Ruling* lists the authorizations and licenses associated with the
    Application. On June 12, 2006, SkyTerra and Motient filed a request
    to withdraw the related transfer of control application for space
    station S2487. *See* *Policy Branch Information: Actions Taken*,
    Public Notice, Report No. SAT-00370, DA 06-1310, 21 FCC Rcd 6891,
    6893 (Int'l Bur. 2006). Contemporaneously, MSV International LLC
    surrendered its license for space station S2487. *See* Letter from
    Jennifer A. Manner, Vice President, Regulatory Affairs, MSV
    International LLC, to Marlene H. Dortch, Secretary, Federal
    Communications Commission, File No. SAT-LOA-20030827-00174 (filed
    June 12, 2006).

[^3]: The "L-band" is a general designation for frequencies from 1 to 2
    GHz. In the United States, the Commission has allocated L-band
    spectrum for MSS downlinks (space-to-Earth transmissions) in the
    1525-1544 MHz and 1545-1559 MHz bands and for MSS uplinks
    (Earth-to-space transmissions) in the 1626.5-1645.5 MHz and
    1646.5-1660.5 MHz bands. *See* 47 C.F.R. § 2.106.

[^4]: *See* Application at Figure 1.

[^5]: *Id.* Investors not listed in the table hold less than one percent
    of the ownership interests in MSV LP.

[^6]: *See* Press Release, "Motient and SkyTerra Announce Transactions
    to Consolidate Ownership of Mobile Satellite Ventures and TerreStar
    Networks," dated May 8, 2006, *available at*
    <http://www.motient.com/ci_nr_pr.php?id=63> (Motient May 8 Press
    Release). *See also*
    [http://www.terrestarnetworks.com](http://www.terrestarnetworks.com/).
    The term "2 GHz MSS band" refers to the 2000-2020 MHz uplink
    (Earth-to-space transmission) and 2180-2200 MHz downlink
    (space-to-Earth transmission) frequencies.

[^7]: *See* File No. SAT-ASG-20021211-00238; *Policy Branch Information:
    Satellite Space Applications Accepted for Filing*, Public Notice,
    Report No. SAT-00130 (rel. December 27, 2002) (*TMI/TerreStar Public
    Notice*).

[^8]: *See* Letter from Gregory C. Staple, Counsel to TMI and Henry
    Goldberg, Counsel to TerreStar, to Marlene H. Dortch, Secretary,
    Federal Communications Commission, File Nos. 189-SAT-LOI-97,
    SAT-LOI-19970926-00161, SAT-AMD-20001103-00158,
    SAT-MOD-20021114-00237, SAT-ASG-20021211-00238 (filed June 15,
    2005), at Schedule I.

[^9]: *See* Application at 3 & Figure 1.

[^10]: *See* SkyTerra Communications, Inc., Form 10-K (filed March 29,
    2006), at 23; *see generally*
    <http://biz.yahoo.com/ic/40/40036.html>.

[^11]: *See* Letter from Tom W. Davidson, Counsel to SkyTerra
    Communications, Inc., to Marlene H. Dortch, Secretary, Federal
    Communications Commission (filed September 1, 2006) (Davidson
    September 1 Letter).

[^12]: *See* Letter from Tom W. Davidson, Counsel to SkyTerra
    Communications, Inc., to Marlene H. Dortch, Secretary, Federal
    Communications Commission (filed August 22, 2006) (Davidson Update
    Letter), updated Application Figure 2; *see also* Application at 4.

[^13]: *See* Motient Investor Presentation at 13 (June 2006), *available
    for download at*
    <http://phx.corporate-ir.net/phoenix.zhtml?c=110135&p=irol-irhome>.

[^14]: *See* Application at 3.

[^15]: *Id.* at 4.

[^16]: *Id.* at 3-4; Letter from Henry Goldberg, Counsel to Motient
    Corporation, to Marlene H. Dortch, Secretary, Federal Communications
    Commission (filed August 24, 2006) (Goldberg August 24 Letter) at 2.

[^17]: *See* Goldberg August 24 Letter at 2.

[^18]: *Id.* We note that, although taking place some time after the
    Investor Exchange, the parties are contractually bound to make the
    Motient Dividend.

[^19]: Specifically, the Apollo Funds' interests in SkyTerra will be a
    27.04% voting interest and a 25.54% equity interest. *See* Davidson
    Update Letter, updated Application Figure 2 & Exhibit C, pages 3-4.
    According to the Applicants, Motient will acquire 5.5% of SkyTerra
    stock as part of the Initial Exchange, initially to be voting stock
    for a period of 60 days, at which time it will be converted to
    non-voting stock. Motient has entered into a voting agreement
    pursuant to which it has agreed to vote this stock on a *pro rata*
    basis with the other SkyTerra shareholders during the 60 day period.
    Accordingly, the Applicants treat Motient's 5.5% interest in
    SkyTerra as non-voting stock for purposes of this proceeding. *See*
    Letter from Tom W. Davidson, Counsel to SkyTerra Communications,
    Inc., and Henry Goldberg, Counsel to Motient Corporation, to Marlene
    H. Dortch, Secretary, Federal Communications Commission (filed
    August 22, 2006) (August 22 Foreign Ownership Supplement), at 5 n.3.
    Motient also has a right to exchange any or all of its remaining
    19.2% equity interest in MSV for additional shares of SkyTerra
    non-voting stock, which, if fully exercised, would give Motient a
    combined equity interest in SkyTerra of approximately 57.7%. *See*
    Goldberg August 24 Letter at 2-3. The Applicants state that they do
    not seek approval for this future exchange, claiming "prior FCC
    approval is not required to transfer non-voting interests in
    SkyTerra to Motient." *Id.* at 3 n.2. It is not clear from the
    record before us that the future exchange would not require prior
    Commission approval. We refer the Applicants to 47 C.F.R. §
    25.119(b)(2) and 47 C.F.R. § 63.24(c) as guidance for the need to
    receive prior Commission approval should Motient decide to exercise
    its rights to effect this future exchange. We also caution Motient
    to consider whether the future exchange may require prior Commission
    approval under the foreign ownership provisions of 47 U.S.C. §
    310(b)(4) due to foreign equity and voting interests that may be
    held in Motient at the time of the future exchange.

[^20]: *See* Davidson Update Letter, updated Application Exhibit C, page
    4.

[^21]: *See Applications filed for Consent to Transfer Control of Mobile
    Satellite Ventures Subsidiary LLC from Motient Corporation and
    Subsidiaries to SkyTerra Communications*, WC Docket No. 06-106,
    Public Notice, DA 06-1254, 21 FCC Rcd 6534 (2006).

[^22]: Letter from Sigal P. Mandelker, Deputy Assistant Attorney
    General, U.S. Department of Justice, to Marlene H. Dortch,
    Secretary, Federal Communications Commission (July 17, 2006).

[^23]: Petition to Adopt Conditions to Authorizations and Licenses of
    the U.S. Department of Justice, the Federal Bureau of Investigation,
    and the U.S. Department of Homeland Security (August 25, 2006),
    *attaching* Letter from Robert Lewis, Senior Vice President and
    General Counsel, SkyTerra Communications, Inc. and Randy S. Segal,
    Senior Vice President and General Counsel, Mobile Satellite Ventures
    LP to Sigal P. Mandelker, Deputy Assistant Attorney General, U.S.
    Department of Justice, Elaine N. Lammert, Deputy General Counsel,
    Federal Bureau of Investigation, and Stewart A. Baker, Assistant
    Secretary for Policy, U.S. Department of Homeland Security (dated
    August 21, 2006).

[^24]: Highland's current equity ownership in Motient is approximately
    14% of Motient's outstanding and issued shares. Comments of Highland
    Capital Management, LP (July 18, 2006) (Highland Comments), at 1. If
    the proposed transaction is consummated, Highland would receive
    shares of SkyTerra in exchange for its shares of Motient. *Id.* at 2
    n.2.

[^25]: July 18^th^ was one day after comments were due under the
    pleading cycle established in this case. Thus, Highland also filed a
    Motion to Accept Late-Filed Comments on July 19, 2006. Motient filed
    an Opposition to Highland's Motion (filed July 20, 2006) (Motient
    Opposition to Motion to Accept Late-Filed Comments), to which
    Highland replied (filed August 4, 2006) (Highland Reply to
    Opposition to Accept Late-Filed Comments). We do not view Highland's
    late filing as egregious in this instance. The Applicants had a full
    and adequate opportunity to respond to Highland's comments. The
    comments supplemented the existing record and created a full and
    more complete record for our review. Highland's tardiness has not
    prevented us from acting in an expeditious fashion on the
    Application. We therefore grant Highland's motion and accept
    Highland's one-day late-filed comments as a part of our record on
    review.

[^26]: *See* Highland Comments at 2-3.

[^27]: *Id.* at 3-14.

[^28]: *Id.* at 17.

[^29]: *Id.* at 7-8. Highland explains that TMI, TerreStar's "Canadian
    partner," currently holds one of the two spectrum reservations to
    provide 2 GHz MSS to U.S. consumers, and that TerreStar is the U.S.
    entity that is constructing the 2 GHz MSS satellite and terrestrial
    communications network. *Id.* at 5. TMI has an application pending
    at the Commission to assign its spectrum reservation to TerreStar.
    *See TMI/TerreStar Public Notice*, *supra* footnote 7.

[^30]: Highland Comments at 8 (emphasis in original); *see also id.* at
    10-11.

[^31]: *See id.* at 13.

[^32]: *Id.* at 8.

[^33]: *Id.* at 14-17. Highland's pending lawsuit against Motient seeks
    rescission of the agreement between Motient and SkyTerra that is the
    subject of the instant Application, as unenforceable under the
    Investment Company Act of 1940 and contract law. *Highland Crusader
    Offshore Partners, L.P., et al. v. Motient Corporation, et al.*,
    Cause No. D-1-GN-06-002219 (District Court of Travis County, TX,
    53^rd^ Judicial District, filed June 19, 2006), *removed to federal
    court*, *Highland Crusader Offshore Partners, L.P., Highland Equity
    Focus Fund, L.P., Highland Capital Management, L.P., and Highland
    Capital Management Services, Inc. v. Motient Corporation and Capital
    & Technology Advisors, Inc.*, Case No. 1:06-cv-00540-LY (W.D.Tex.,
    removed July 14, 2006).

[^34]: *See* Highland Comments at 17-18 n.24.

[^35]: Opposition of Motient to Comments of Highland Capital Management,
    LP (filed July 27, 2006) (Motient Opposition); Opposition of
    SkyTerra to Comments (filed July 27, 2006) (SkyTerra Opposition).
    Motient provided information that one of Highland's principal
    shareholders acquired an almost 9% ownership interest in ICO Global
    Communications (Holdings) Limited ("ICO"), which Motient
    characterized as the "other mobile satellite new entrant in the 2
    GHz band" asserting that Highland is disingenuous in expressing
    interest for TerreStar's future. Motient Opposition at 2.

[^36]: *See* Motient Opposition at 1-2.

[^37]: *See* SkyTerra Opposition at 3-5.

[^38]: *Id.* at 6-8.

[^39]: Reply of Highland to Oppositions to Comments (filed August 1,
    2006) (Highland Reply). In its reply, Highland claims that its
    acquisition of ICO shares is irrelevant to the Application because
    Highland has been an ICO investor for substantially the same amount
    of time that it has been an investor in Motient, and that the shares
    have no supermajority voting control, making Highland a passive
    investor. Highland notes that Motient has "conflicting investment
    interests in the MSS space segment" that were not disclosed to the
    Commission, creating an incentive for Apollo, SkyTerra's potential
    investor, to "complicate the business plans of MSV and TerreStar."
    *Id.* at 10-14.

[^40]: *See id.* at 6-10, 14-21.

[^41]: Letter from Joseph A. Godles, Counsel to TerreStar Network Inc.,
    to Marlene H. Dortch, Secretary, Federal Communications Commission
    (filed August 3, 2006); Letter from Henry Goldberg, Counsel to
    Motient Corporation, to Marlene H. Dortch, Secretary, Federal
    Communications Commission (filed August 7, 2006) (Goldberg August 7
    Letter); Letter from Henry Goldberg, Counsel to Motient Corporation,
    to Marlene H. Dortch, Secretary, Federal Communications Commission
    (filed August 14, 2006) (Goldberg August 14 Letter); Davidson Update
    Letter, *supra* footnote 12; August 22 Foreign Ownership Supplement,
    *supra* footnote 19; Goldberg August 24 Letter, *supra* footnote 16;
    Letter from Tom W. Davidson, Counsel to SkyTerra Communications,
    Inc., and Henry Goldberg, Counsel to Motient Corporation, to Marlene
    H. Dortch, Secretary, Federal Communications Commission (filed
    August 31, 2006) (August 31 Foreign Ownership Supplement); Davidson
    September 1 Letter, *supra* footnote 11.

[^42]: 47 U.S.C. §§ 214(a), 310(d).

[^43]: 47 U.S.C. § 310(d) requires that we consider the applications for
    transfer of Title III licenses (space station and earth station
    authorizations in this case) under the same standard as if the
    proposed transferee were applying for the licenses directly under
    section 308 of the Act, 47 U.S.C. § 308. *See SBC Communications,
    Inc. and AT&T Corp. Applications for Approval of Transfer of
    Control*, WC Docket No. 05-65, Memorandum Opinion and Order, FCC
    05-183, 20 FCC Rcd 18290, 18300 n.60 (2005) (*SBC/AT&T Order*);
    *Verizon Communications Inc. and MCI, Inc. Applications for Approval
    of Transfer of Control*, WC Docket No. 05-75, Memorandum Opinion and
    Order, FCC 05-184, 20 FCC Rcd 18433, 18443 n.59 (2005) (*Verizon/MCI
    Order*); *Applications of Western Wireless Corporation and Alltel
    Corporation for Consent to Transfer Control of Licenses and
    Authorizations*, WT Docket No. 05-50, Memorandum Opinion and Order,
    FCC 05-138, 20 FCC Rcd 13053, 13062-63 ¶ 17 (2005) (*Alltel/Western
    Wireless Order*); *Applications of AT&T Wireless Services, Inc. and
    Cingular Wireless Corporation,* WT Docket 04-70, Memorandum Opinion
    and Order, FCC 04-255, 19 FCC Rcd 21522, 21542 ¶ 40 (2004)
    (*Cingular/AT&T Wireless Order*); *General Motors Corporation and
    Hughes Electronics Corporation, Transferors, and The News
    Corporation Limited, Transferee*, MB Docket No. 03-124, Memorandum
    Opinion and Order, FCC 03-330, 19 FCC Rcd 473, 485 ¶ 18 (2004)
    (*News Corp./Hughes Order*). Thus, we must examine the Applicants'
    qualifications to hold licenses.

[^44]: *See, e.g.*, *SBC/AT&T Order*, 20 FCC Rcd at 18300 ¶ 16;
    *Verizon/MCI Order*, 20 FCC Rcd at 18443 ¶ 16; *Applications of
    Nextel Communications, Inc. and Sprint Corporation for Consent to
    Transfer Control of Licenses and Authorizations*, WT Docket No.
    05-63, Memorandum Opinion and Order, FCC 05-148, 20 FCC Rcd 13967,
    13976 ¶ 20 (2005); *Alltel/Western Wireless Order*, 20 FCC Rcd at
    13062-63 ¶ 17; *Cingular/AT&T Wireless Order*, 19 FCC Rcd at
    21542-43 ¶ 40; *News Corp./Hughes Order*, 19 FCC Rcd at 483 ¶ 15;
    *Application of GTE Corporation, Transferor, and Bell Atlantic
    Corporation, Transferee*, CC Docket 98-184, Memorandum Opinion and
    Order, FCC 00-221, 15 FCC Rcd 14032, 14046 ¶¶ 20, 22 (2002);
    *Applications of VoiceStream Wireless Corporation and Powertel,
    Inc., Transferors, and Deutsche Telekom AG, Transferee,* IB Docket
    No. 00-187, Memorandum Opinion and Order, FCC 01-142, 16 FCC Rcd
    9779, 9789 ¶ 17 (2001) (*Deutsche Telekom/VoiceStream Order*);
    *Applications of Ameritech Corp., Transferor, and SBC Communications
    Inc., Transferee, for Consent to Transfer Control of Corporations
    Holding Commission Licenses and Lines Pursuant to Section 214 and
    310(d) of the Communications Act and Parts 5, 22, 24, 25, 63, 90, 95
    and 101 of the Commission's Rules*, CC Docket No. 98-141, Memorandum
    Opinion and Order, FCC 99-279, 14 FCC Rcd 14712, 14737-38 ¶ 48
    (1999) (*SBC/Ameritech Order*); *Application of WorldCom, Inc. and
    MCI Communications Corporation for Transfer of Control of MCI
    Communications Corporation to WorldCom, Inc.*, CC Docket No. 97-211,
    Memorandum Opinion and Order, FCC 98-225, 13 FCC Rcd 18025, 18031 ¶
    10 (1998) (*WorldCom/MCI Order*); *Applications of NYNEX
    Corporation, Transferor, and Bell Atlantic Corporation, Transferee,
    for Consent to Transfer Control of NYNEX Corporation and its
    Subsidiaries*, Memorandum Opinion and Order, FCC 97-286, 12 FCC Rcd
    19985, 19987 ¶ 2 (1997).

[^45]: *See, e.g.*, *SBC/AT&T Order*, 20 FCC Rcd at 18300 ¶ 16;
    *Verizon/MCI Order*, 20 FCC Rcd at 18443 ¶ 16; *Cingular/AT&T
    Wireless Order*, 19 FCC Rcd at 21542-44 ¶ 40 (citing, *e.g.*, *News
    Corp./Hughes Order*, 19 FCC Rcd at 483 ¶ 15; *Applications for
    Consent to the Transfer of Control of Licenses from Comcast
    Corporation and AT&T Corp., Transferors, to AT&T Comcast
    Corporation, Transferee*, MB Docket No. 02-70, Memorandum Opinion
    and Order, FCC 02-310, 17 FCC Rcd 23246, 23255 ¶ (2002)
    (*AT&T/Comcast Order*); *Application of EchoStar Communications
    Corporation (a Nevada Corporation), General Motors Corporation, and
    Hughes Electronics Corporation (Delaware Corporations) (Transferors)
    and EchoStar Communications Corporation (a Delaware Corporation)
    (Transferee)*, CS Docket No. 01-348, Hearing Designation Order, FCC
    02-284, 17 FCC Rcd 20559, 20574 ¶ 25 (2002) (*EchoStar/DirecTV
    Order*)).

[^46]: We are not required to designate for hearing applications for the
    transfer or assignment of Title II authorizations when we are unable
    to find that the public interest would be served by granting the
    applications. *See ITT World Communications, Inc. v. FCC*, 595 F.2d
    897, 901 (2d Cir. 1979). We may, however, do so if we find that a
    hearing would be in the public interest. However, with respect to
    the applications to transfer licenses subject to Title III of the
    Act, if we are unable to find that the proposed transaction serves
    the public interest, or if the record presents a substantial and
    material question of fact, section 309(e) of the Act requires that
    we designate the application for hearing. 47 U.S.C. § 309(e); *see
    EchoStar/DirecTV Order*, 17 FCC Rcd at 20574 ¶ 25; *Cingular/AT&T
    Wireless Order*, 19 FCC Rcd at 21542-44 ¶ 40.

[^47]: *See* *SBC/AT&T Order*, 20 FCC Rcd at 18301 ¶ 17; *Verizon/MCI
    Order*, 20 FCC Rcd at 18443 ¶ 17; *Cingular/AT&T Wireless Order*, 19
    FCC Rcd at 21544 ¶ 41 (citing, *e.g.*, *News Corp./Hughes Order*, 19
    FCC Rcd at 483-84 ¶ 16; *AT&T/Comcast Order*, 17 FCC Rcd at 23255 ¶
    27; *EchoStar/DirecTV Order*, 17 FCC Rcd at 20575 ¶ 26).

[^48]: *See* 47 U.S.C. §§ 157 nt. (incorporating section 706 of the
    Telecommunications Act of 1996, Pub. Law No. 104-104, 110 Stat. 56
    (1996) (1996 Act), 254, 332(c)(7)); 1996 Act, Preamble; *SBC/AT&T
    Order*, 20 FCC Rcd at 18301 ¶ 17; *Verizon/MCI Order*, 20 FCC Rcd at
    18443-44 ¶ 17; *Cingular/AT&T Wireless Order*, 19 FCC Rcd at 21544
    ¶ 41; *see also* *WorldCom/MCI Order*, 13 FCC Rcd at 18030-31¶ 9;
    *2000 Biennial Regulatory Review Spectrum Aggregation Limits for
    Commercial Mobile Radio Services*, Report and Order, FCC 01-328, 16
    FCC Rcd 22668, 22696 ¶ 55 (2001) (citing 47 U.S.C. §§ 301, 303,
    309(j), 310(d)); *cf*. 47 U.S.C. §§ 521(4), 532(a)).

[^49]: *See SBC/AT&T Order*, 20 FCC Rcd at 18301 ¶ 17; *Verizon/MCI
    Order*, 20 FCC Rcd at 18443-44 ¶ 17; *Cingular/AT&T Wireless Order*,
    19 FCC Rcd at 21544 ¶ 41 (citing, *e.g.*, *AT&T/Comcast Order*, 17
    FCC Rcd at 23255 ¶ 27; *WorldCom/MCI Order*, 13 FCC Rcd at 18030-31
    ¶ 9).

[^50]: *See SBC/AT&T Order*, 20 FCC Rcd at 18301-02 ¶ 17; *Verizon/MCI
    Order*, 20 FCC Rcd at 18444 ¶ 17; *Cingular/AT&T Wireless Order*, 19
    FCC Rcd at 21544 ¶ 41.

[^51]: 47 U.S.C. §§ 214(a), 310(d).

[^52]: *See Deutsche Telekom/VoiceStream Order*, 16 FCC Rcd at 9790 ¶
    19.

[^53]: *Id.*

[^54]: Section 308 requires that applicants for Commission licenses set
    forth such facts as the Commission may require as to citizenship,
    character, and financial, technical, and other qualifications. *See*
    47 U.S.C. § 308. Our rules implementing the provisions of section
    308 regarding an applicant's qualifications to hold the Commission
    licenses involved in this transfer are set forth in Parts 5, 25 and
    63 of the Commission's rules. *See* 47 C.F.R. Parts 5, 25, 63.

[^55]: Highland Comments at 2-3.

[^56]: *Id.* at 13-15.

[^57]: *See supra* footnote 41 and accompanying text.

[^58]: *See supra* footnote 33.

[^59]: Application at 7.

[^60]: Highland Comments at 3-4.

[^61]: *Id.* at 4 (citing *Verizon/MCI Order*, 20 FCC Rcd at 18530-18531
    ¶¶ 195-196).

[^62]: *See* Motient May 8 Press Release, *supra* footnote 6.

[^63]: Goldberg August 14 Letter, *attaching* Letter from Robert L.
    Macklin, Vice President, General Counsel, Motient Corporation, to
    Marlene H. Dortch, Secretary, Federal Communications Commission
    (filed August 14, 2006) (Macklin August 14 Letter).

[^64]: *See* Goldberg August 24 Letter at 4.

[^65]: Macklin August 14 Letter; *see also* Goldberg August 7 Letter
    (citing Motient Investor Presentation, *supra* footnote 13);
    SkyTerra Opposition at 7-8 n.22.

[^66]: SkyTerra Opposition at 7-8.

[^67]: We note that while TerreStar is not a party to the instant
    application, we recognize and consider the public interest benefits
    that affect TerreStar as a result of this transaction. *Cf.
    Shareholders of GAF Corporation*, Memorandum Opinion and Order, FCC
    92-185, 7 FCC Rcd 3225, 3229 ¶ 15 (1992) ("\[W\]hile we believe, as
    a general principle, that we should not become involved in reviewing
    corporate financing decisions, specific allegations of fact in
    particular cases may warrant such an inquiry under our public
    interest mandate.").

[^68]: Highland Comments at 9-12.

[^69]: *See* Goldberg August 24 Letter at 3.

[^70]: *Id.*

[^71]: *See* Motient Investor Presentation at 23, 33, 37.

[^72]: *See Amendment of the Commission's Space Station Licensing Rules
    and Policies*, IB Docket No. 02-34, First Report and Order and
    Further Notice of Proposed Rulemaking, FCC 03-102, 18 FCC Rcd 10760,
    10822-10824 ¶¶ 161-165 (2003) (Commission eliminates the examination
    of financial qualifications that, at one time, was intended to help
    ensure that licensees have the financial resources to proceed with
    satellite construction and implementation plans and make service
    available to users promptly, instead concluding that strict
    milestone enforcement provides more certainty that systems will be
    timely built, while allowing the lesser-funded smaller or start-up
    companies an opportunity to succeed or fail in the marketplace).

[^73]: Goldberg August 14 Letter, *attaching* Letter from Robert H.
    Brumley, President and CEO, TerreStar to Marlene H. Dortch,
    Secretary, Federal Communications Commission (filed August 14,
    2006).

[^74]: *See* Goldberg August 7 Letter.

[^75]: As a federal agency, the "public interest standard does not
    entitle us, nor would we seek, to control or manage" a company's day
    to day business operations, or "undertake any action of a corporate
    governance nature" that would affect the rights of shareholders, the
    current board of directors and/or management. More "appropriate
    forums" are available for a company to "redress its alleged
    grievances." *Comsat Corporation*, Memorandum Opinion and Order, FCC
    97-422, 13 FCC Rcd 2714, 2729 ¶ 33 (1998).

[^76]: *See MMM Holdings, Inc. for Transfer of Control of LIN
    Broadcasting Corporation*, Memorandum Opinion and Order, FCC 89-300,
    4 FCC Rcd 8243, 8245 ¶ 14 (1989) (noting "the Commission's basic
    predilection not to second-guess \[the\] kinds of business
    judgments" that "must be ratified by a significant segment of the
    financial community."); *cf. Stockholders of CBS Inc. (Transferor)
    and Westinghouse Electric Corporation (Transferee)*, Memorandum
    Opinion and Order, FCC 95-469, 11 FCC Rcd 3733, 3746 ¶ 26 (1995)
    ("the Commission generally refrains from interfering with a
    company's capital structure"); *GAF Corporation*, 7 FCC Rcd at 3229
    ¶ 15 ("The Commission's general policy is not to interfere with a
    company's capital structure or second guess the financial community
    or investors . . . .").

[^77]: The Investment Company Act regulates the structure and operation
    of mutual funds, requiring funds to safeguard their portfolio,
    forward price their securities, and keep detailed books and records.
    *See* 17 C.F.R. Part 270.

[^78]: Motient Opposition at 2; Motient Opposition to Motion to Accept
    Late-Filed Comments at 3-4; SkyTerra Opposition at 3-4.

[^79]: Motient Opposition at 2; Motient Opposition to Accept Late-Filed
    Comments at 4 (citing *Comsat Corporation*, 13 FCC Rcd at 2729 ¶ 33;
    *Loral Satellite Inc. (Debtor-in-Possession) and Loral SpaceCom
    Corp. (Debtor-in-Possession), Assignors, and Intelsat North America,
    Assignee*, Order and Authorization, DA 04-357, 19 FCC Rcd 2404, 2420
    ¶ 37 (Int'l Bur. 2004)). *See also* SkyTerra Opposition at 3-5.

[^80]: Highland Reply to Oppositions at 16-17, 21-22.

[^81]: Highland Reply to Opposition to Accept Late-Filed Comments at
    8-9.

[^82]: *See, e.g.*, *AT&T Corp., British Telecommunications, plc, VLT
    Co. L.L.C., Violet License Co. LLC, and TNV \[Bahamas\] Limited
    Applications for Grant of Section 214 Authority, Modification of
    Authorizations and Assignment of Licenses in Connection With the
    Proposed Joint Venture Between AT&T Corp. and British
    Telecommunications, plc*, IB Docket No. 98-212, Memorandum Opinion
    and Order, FCC 99-313, 14 FCC Rcd 19140 (1999); *Deutsche
    Telekom/VoiceStream Order*, 16 FCC Rcd 9779.

[^83]: *See WorldCom/MCI Order*, 13 FCC Rcd at 18039 ¶ 23, 18070 ¶ 78;
    *Application of General Electric Capital Corporation, Transferors,
    and SES Global, S.A., Transferees*, Order and Authorization, DA
    01-2100, 16 FCC Rcd 17575, 17594 ¶ 43 (Int'l Bur. & WTB 2001).

[^84]: *See Use of Returned Spectrum in the 2 GHz Mobile Satellite
    Service Frequency Bands*, IB Docket Nos. 05-220 and 05-221, Order,
    FCC 05-204, 20 FCC Rcd 19696, 19711 ¶ 33 (2005).

[^85]: *See, e.g.*, *Lockheed Martin Corporation, Comsat Government
    Systems, LLC, and COMSAT Corporation, Application for Transfer of
    Control of COMSAT Corporation and its Subsidiaries, Licensees of
    Various Satellite, Earth Station, Private Land Mobile Radio and
    Experimental Licenses, and Holders of International Section 214
    Authorizations*, Order and Authorization, FCC 00-277, 15 FCC Rcd
    22910, 22916 ¶ 18 (2000).

[^86]: Big LEO systems provide voice and data communication to users
    with handheld mobile terminals via non-geostationary satellites in
    Low Earth Orbit (LEO), *i.e.*, at orbital altitudes below the Van
    Allen Radiation Belt. The term "Big LEO" was coined to distinguish
    such systems, operating in the 1.6/2.4 GHz frequency bands, from the
    so-called "Little LEO" systems that provide data communications via
    non-geostationary satellites in frequency bands below 1 GHz.

[^87]: *See TMI/TerreStar Public Notice*, *supra* footnote 7.

[^88]: Highland Comments at 4-8, 10-11 & Highland Reply at 18-19, 21.

[^89]: *See* Application at 7-8.

[^90]: *Motient Services Inc. and TMI Communications and Company, LP,
    Assignors and Mobile Satellite Ventures Subsidiary LLC, Assignee*,
    Order and Authorization, DA 01-2732, 16 FCC Rcd 20469, 20477 ¶ 22
    (Int'l Bur. 2001) (*MSV 2001 Order*). The *MSV 2001 Order* permitted
    MSV "to be owned indirectly by TMI and/or BCE Inc. and their
    Canadian shareholders in an amount up to and including an equity
    and/or voting interest of 40%. Additional approval would be required
    under section 310(b)(4) before TMI or BCE Inc. increases its
    indirect investment in \[MSV\] above this authorized level. \[MSV\]
    shall also seek additional Commission approval before other foreign
    individuals or entities, including foreign owners of Motient Corp.,
    Columbia Capital, and Spectrum Equity, MSV Investors, LLC and
    non-U.S., non-Canadian owners of TMI and BCE Inc., acquire
    individually and/or in the aggregate a greater than 25% indirect
    equity and/or voting interest in \[MSV\]." *Id*.

[^91]: *See id.* at 20471 ¶¶ 5-6.

[^92]: 47 C.F.R. § 1.2.

[^93]: 47 U.S.C. § 310(b)(4),(d); *see Rules and Policies on Foreign
    Participation in the U.S. Telecommunications Market*, Report and
    Order and Order on Reconsideration, FCC 97-398, 12 FCC Rcd 23891
    (1997) ("*Foreign Participation Order*"), Order on Reconsideration,
    FCC 00-339, 15 FCC Rcd 18158 (2000).

[^94]: The Commission considers national security, law enforcement,
    foreign policy, and trade policy concerns when analyzing foreign
    investment pursuant to sections 310(b)(4) and 310(d). *Foreign
    Participation Order*, 12 FCC Rcd at 23918-21 ¶¶ 59-66. *See also
    infra* Section III.F.

[^95]: Section 310(a) of the Act prohibits any radio license from being
    "granted to or held by" a foreign government or its representative.
    47 U.S.C. § 310(a). In this case, no foreign government or its
    representative holds any of the radio licenses. Section
    310(b)(1)-(2) of the Act prohibits common carrier, broadcast and
    aeronautical fixed or en route radio licenses from being "granted to
    or held by" aliens, or their representatives, or foreign
    corporations. 47 U.S.C. § 310(b)(1)-(2). We find that no alien,
    representative, or foreign corporation holds any of the common
    carrier licenses in this case. Accordingly, we find that the
    proposed transaction is not inconsistent with the foreign ownership
    provisions of section 310(a) or 310(b)(1)-(2) of the Act. *See
    Deutsche Telekom/VoiceStream Order*, 16 FCC Rcd at 9804-9809 ¶¶
    38-48. Additionally, because the foreign investment in MSV is held
    through MSV LP, a Delaware limited partnership that is the sole
    member of MSV, the proposed transaction does not trigger section
    310(b)(3) of the Act, which places a 20% limit on alien, foreign
    corporate or foreign government ownership of entities that
    themselves hold common carrier, broadcast and aeronautical fixed or
    en route Title III licenses. *Compare* 47 U.S.C. § 310(b)(3) with §
    310(b)(4). *See Request for Declaratory Ruling Concerning the
    Citizenship Requirements of Sections 310(b)(3) and (4) of the
    Communications Act of 1934, as amended,* Declaratory Ruling, FCC
    85-295, 103 F.C.C. 2d 511 (1985) ("*Wilner & Scheiner I*"), *recon.
    in part*, FCC 86-406, 1 FCC Rcd 12 (1986).

[^96]: 47 U.S.C. § 310(b)(4).

[^97]: *See BBC License Subsidiary L.P.*, Memorandum Opinion and Order,
    DA 95-364, 10 FCC Rcd 10968, 10973 ¶ 22 (1995) ("*BBC License
    Subsidiary*").

[^98]: *See id.* at 10972 ¶ 20, & 10973-74 ¶¶ 22-25.

[^99]: *See id.* at 10973-74 ¶ 25.

[^100]: *Sprint Corporation Petition for Declaratory Ruling Concerning
    Section 310(b)(4) and (d) and the Public Interest Requirements of
    the Communications Act of 1934, as amended*, Declaratory Ruling and
    Order, FCC 95-498, 11 FCC Rcd 1850, 1857-58 ¶ 47 (1995) (quoting
    section 310(b)(4)). It is the licensee's obligation to inform the
    Commission before its indirect foreign ownership exceeds the 25%
    benchmark set forth in section 310(b)(4). *See Application of Fox
    Television Stations, Inc. for Renewal of License of Station WNYW-TV,
    New York, New York*, Memorandum Opinion and Order, FCC 95-188, 10
    FCC Rcd 8452, 8474-75 ¶ 52 (1995).

[^101]: *Foreign Participation Order*, 12 FCC Rcd at 23896 ¶ 9, 23913 ¶
    50, & 23940 ¶¶ 111-112.

[^102]: *Id.*

[^103]: To determine a foreign entity's home market for purposes of the
    public interest determination under section 310(b)(4), the
    Commission will identify and balance the following factors: (1) the
    country of a foreign entity's incorporation, organization or
    charter, (2) the nationality of all investment principals, officers,
    and directors, (3) the country in which the world headquarters is
    located, (4) the country in which the majority of the tangible
    property, including production, transmission, billing, information,
    and control facilities, is located, and (5) the country from which
    the foreign entity derives the greatest sales and revenues from its
    operations. *Foreign Participation Order*, 12 FCC Rcd at 23941 ¶ 116
    (citing *Market Entry and Regulation of Foreign-Affiliated
    Entities*, Report and Order, FCC 95-475, 11 FCC Rcd 3873, 3951 ¶ 207
    (1995)). For examples of cases applying the five-factor "principal
    place of business" test, *see Lockheed Martin Global
    Telecommunications, Comsat Corporation, and Comsat General
    Corporation, Assignor, and Telenor Satellite Mobile Services, Inc.,
    and Telenor Satellite, Inc., Assignee, Applications for Assignment
    of Section 214 Authorizations, Private Land Mobile Radio Licenses,
    Experimental Licenses, and Earth Station Licenses and Petition for
    Declaratory Ruling Pursuant to Section 310(b)(4) of the
    Communications Act*, Order and Authorization, FCC 01-369, 16 FCC Rcd
    22897 (2001), *erratum,* DA 02-266, 17 FCC Rcd 2147 (Int'l Bur.
    2002), *recon. denied*, FCC 02-207, 17 FCC Rcd 14030 (2002); *Space
    Station System Licensee, Inc., Assignor, and Iridium Constellation
    LLC, Assignee, et al.*, Memorandum Opinion, Order and Authorization,
    DA 02-307, 17 FCC Rcd 2271 (Int'l Bur. 2002).

[^104]: *See Foreign Participation Order*, 12 FCC Rcd at 23946 ¶ 131.

[^105]: *See generally Wilner & Scheiner I*, 103 F.C.C. 2d 511; *BBC
    License Subsidiary*, 10 FCC Rcd at 10973-74 ¶¶ 22‑25.

[^106]: *See BBC License Subsidiary*, 10 FCC Rcd at 10973-74 ¶¶ 24-25.

[^107]: *See id.* at 10973-74 ¶ 25.

[^108]: *See id.* at 10973 ¶ 23; *see also Wilner & Scheiner I*, 103
    F.C.C. 2d at 522 ¶ 19.

[^109]: *See, e.g.*, *XO Communications, Inc., Applications for Consent
    to Transfer Control of Licenses and Authorizations Pursuant to
    Sections 214 and 310(d) and Petition for Declaratory Ruling Pursuant
    to Section 310(b)(4) of the Communications Act*, IB Docket No.
    02-50, Memorandum Opinion, Order and Authorization, DA 02-2512, 17
    FCC Rcd 19212, 19222 ¶ 24 (Int'l Bur., WTB & WCB 2002) ("*XO
    Communications*").

[^110]: *See Foreign Participation Order*, 12 FCC Rcd at 23940-41 ¶¶
    111-15.

[^111]: *See supra* paragraph 5. Less than one percent of the limited
    partnership interests in MSV LP will be held by investors not
    identified in the Application.

[^112]: *See* August 22 Foreign Ownership Supplement at 1. Because MSV
    GP will hold no equity interest in MSV LP, and given that MSV GP's
    owners (SkyTerra and TMI) are invested directly in MSV LP as limited
    partners, we find no reason in the circumstances of this case to
    inquire into MSV GP's capital structure, which is not discussed in
    the Application.

[^113]: SkyTerra's final calculations of its post-transaction foreign
    ownership are set forth in Attachment 1 of the August 31 Foreign
    Ownership Supplement. Supporting information also is contained in
    the August 22 Foreign Ownership Supplement. We calculate total
    foreign equity and voting interests in SkyTerra of 22.50% and
    22.00%, respectively. Thus, foreign individuals and entities will
    hold, in the aggregate, a 13.23% equity interest (22.5% x 58.8%) and
    a 22.00% voting interest (22.0% x 100%) in MSV LP. Our calculations
    of the foreign equity and voting interests that will be held in
    SkyTerra by or though the Apollo Funds differ from the Applicants'
    calculations. Applicants calculate the foreign equity and voting
    interests that will be held in SkyTerra by or through the Apollo
    Funds as 1.53% and 1.62%, respectively. *See* August 31 Foreign
    Ownership Supplement, Attachment 1. We calculate an additional 2.12%
    foreign equity and voting interests attributable to the Apollo
    Funds, resulting in a total 3.65% foreign equity interest and a
    total 3.74% foreign voting interest that will be held in SkyTerra by
    or though the Apollo Funds. We calculate the additional 2.12% amount
    as follows. Three of the Apollo Funds are organized as limited
    liability companies: AIF/RRRR, LLC, AP/RM Acquisition, LLC, and
    ST/RRRR, LLC (collectively, the "Apollo LLC Funds"). The sole
    managing member of each of the Apollo LLC Funds is Apollo Investment
    Fund IV, L.P. *See* August 31 Foreign Ownership Supplement at 3.
    Apollo Investment Fund IV, L.P. holds equity interests in each of
    the Apollo LLC Funds as follows: 1.41% in AIF/RRRR, LLC; 94.91% in
    AP/RM Acquisition LLC; and 4.09% in ST/RRRR, LLC. *See* August 22
    Foreign Ownership Supplement, Attachment 1 at 3-5. Applicants
    calculate that foreign entities hold an aggregate 2.11% limited
    partner interest in Apollo Investment Fund IV, L.P. *See id.*,
    Attachment 1 at 1. We accept that these foreign equity and voting
    interests represent passive investment in Apollo Investment Fund IV,
    L.P., which is controlled by its general partner, Apollo Advisors
    IV, L.P., which, in turn, is controlled indirectly by Mr. Leon
    Black. *See* Application, Exhibit C at 4-5. *See also* August 31
    Foreign Ownership Supplement at 2. Consistent with our foreign
    ownership case precedent, we use the multiplier to calculate the
    following foreign equity and voting interests in the Apollo LLC
    Funds attributable to the 2.11% foreign equity and voting interests
    in Apollo Investment Fund IV, L.P.: AIF/RRRR, LLC (0.03%) (2.11% x
    1.41%); AP/RM Acquisition LLC (2.00%) (2.11% x 94.91%); and ST/RRRR,
    LLC (0.09%) (2.11% x 4.09%), totaling an additional 2.12% foreign
    equity and voting interests attributable to the Apollo Fund
    investment in SkyTerra.

[^114]: Motient's final calculations of its post-transaction foreign
    ownership are set forth in the August 31 Foreign Ownership
    Supplement. *See also* August 22 Foreign Ownership Supplement. We
    calculate the 5.57% foreign equity interest that will be held in MSV
    LP through Motient's 19.2% limited partnership interest in MSV LP by
    multiplying the percentage of foreign-held shares in Motient (29% of
    Motient's issued and outstanding common and preferred shares) by
    Motient's 19.2% limited partnership (*i.e.*, equity) interest in MSV
    LP (29% x 19.2% = 5.57%).

[^115]: *See* August 31 Foreign Ownership Supplement at 6.

[^116]: *Id.* at 2.

[^117]: *See* Application at 3.

[^118]: *MSV 2001 Order*, 16 FCC Rcd at 20477 ¶ 22.

[^119]: TMI is a limited partnership organized under the laws of Canada.
    Its general partner, TMI Communications Inc., is wholly owned by BCE
    Inc. Both TMI Communications Inc. and BCE Inc. are organized under
    the laws of Canada. The sole limited partner of TMI is 3484203
    Canada Inc., a Canadian company that is wholly owned by Telesat
    Canada. Telesat Canada also is organized under the laws of Canada
    and, like TMI, is wholly owned and controlled by BCE Inc. We find
    that each of these named entities have their principal places of
    business in Canada. *See* August 22 Foreign Ownership Supplement at
    6-7; *see also* August 31 Foreign Ownership Supplement at 9.

[^120]: *See* August 22 Foreign Ownership Supplement at 6.

[^121]: Information submitted by the Applicants indicates that no more
    than 4.96% of the equity interests and no more than 4.99% of the
    voting interests in MSV LP would be held by individuals or entities
    from non-WTO Member countries. Applicants calculate that non-WTO
    investors account for 4.00% and 3.43% of the equity and voting
    interests in SkyTerra, respectively. *See* August 31 Foreign
    Ownership Supplement at 2-9 and Attachment 1. Thus, we calculate
    non-WTO equity and voting interests in MSV LP through SkyTerra as
    2.35% (4.00% x 58.80%) and 3.43% (3.43% x 100%), respectively.
    According to the Applicants, no more than 13.60% of Motient's equity
    (common and preferred stock) interests and no more than 8.10% of
    Motient's voting (common stock) interests are held by non-WTO
    investors. *See* August 31 Foreign Ownership Supplement at 6-9. We
    therefore calculate non-WTO equity and voting interests in MSV LP
    through Motient as no more than 2.61% (13.60% x 19.20%) and 1.56%
    (8.10% x 19.20%), respectively. As discussed *supra* paragraph 41,
    we apply the multiplier to calculate Motient's (but not SkyTerra's)
    foreign voting interest in MSV LP.

[^122]: Generally, the section 310(b)(4) rulings we issue to common
    carrier licensees under the *Foreign Participation Order* approve
    the specific indirect equity and/or voting interests made by *named*
    foreign investors from WTO Member countries; and provide an
    allowance for an additional, aggregate 25% amount of unidentified
    foreign equity and/or voting interests, subject to certain
    limitations to ensure that no individual investor obtains an
    interest that exceeds 25% without prior Commission approval and that
    non-WTO Member investment does not exceed 25%. *See XO
    Communications*, 17 FCC Rcd at 19223 n.77.

[^123]: *See* *MSV 2001 Order*, 16 FCC Rcd at 20477 ¶ 22.

[^124]: *Id*.

[^125]: As explained in paragraph 42, Applicants state that only 0.1% of
    BCE Inc. shares are held by non-U.S., non-Canadian shareholders.
    Consistent with our foreign ownership case precedent, we apply the
    multiplier to calculate a 0.02% equity interest and a 0.02% voting
    interest in MSV LP attributable to these non-U.S., non-Canadian
    shareholders of BCE Inc., which will retain (through TMI) its
    indirect 21.8% limited partnership (equity) interest in MSV LP (0.1%
    x 21.8%) and its 21.8% non-controlling ownership (voting) interest
    in MSV GP (0.1% x 21.8%).

[^126]: While in this case the Applicants stated they did not need a
    declaratory ruling, we find above that the Applicants'
    post-transaction foreign voting interests would exceed, slightly,
    the parameters of the ruling in the *MSV 2001 Order* under which the
    Applicants claimed they remained in compliance. We make this finding
    based upon the record, and based upon our calculation of the total
    foreign equity and voting interests in MSV LP through TMI, SkyTerra
    and Motient. All common carrier radio licensees and their parent
    companies should err on the side of caution in calculating and
    making statements about foreign ownership. Applicants should consult
    the *Foreign Ownership Guidelines* before filing applications,
    provide all requisite calculations, and request a properly-supported
    declaratory ruling. *See Foreign Ownership Guidelines for FCC Common
    Carrier and Aeronautical Radio Licenses*, DA 04-3610, 19 FCC Rcd
    22612 (Int'l Bur. 2004), *erratum*, DA 06-1242, 21 FCC Rcd 6484
    (Int'l Bur. 2006) (*Foreign Ownership Guidelines*).

[^127]: *See supra* paragraphs 27-29.

[^128]: *See infra* paragraphs 47-49.

[^129]: *See* *supra* footnote 113 for the calculation of the 3.65%
    foreign equity interests and the 3.74% foreign voting interests that
    will be held in SkyTerra by or through the Apollo Funds. As the next
    step, we calculate a 2.15% foreign equity interest and a 3.74%
    foreign voting interest that will be held indirectly in MSV through
    the Apollo Fund investments in SkyTerra. For equity, we calculate as
    follows: we multiply the foreign equity interest that will be held
    in SkyTerra by and through the Apollo Funds (3.65%) by SkyTerra's
    proposed equity interest in MSV LP (58.80%) (3.65% x 58.80% =
    2.15%). Consistent with our foreign ownership case precedent, we do
    not apply the multiplier in calculating the foreign voting interest
    that will be held indirectly in MSV through the Apollo Fund
    investments in SkyTerra because SkyTerra will have voting control of
    MSV LP. Thus, we calculate a 3.74% foreign voting interest that will
    be held indirectly in MSV through the Apollo Fund investments in
    SkyTerra (3.74% x 100% = 3.74%).

[^130]: *See* August 31 Foreign Ownership, Attachment 1; August 22
    Foreign Ownership Supplement, Attachment 1.

[^131]: *See infra* paragraph 46; *see also supra* footnote 122.

[^132]: *See, e.g*., *Foreign Ownership Guidelines*, 19 FCC Rcd 22612,
    *erratum*, 21 FCC Rcd 6484.

[^133]: *Foreign Participation Order*, 12 FCC Rcd at 23918 ¶ 59;
    *Amendment of the Commission's Regulatory Policies to Allow Non-U.S.
    Licensed Space Stations to Provide Domestic and International
    Satellite Service in the United States*, IB Docket No. 96-111,
    Report and Order, FCC 97-399, 12 FCC Rcd 24094, 24170 ¶ 178 (1997).

[^134]: *See supra* paragraph 9.

[^135]: The November 14, 2001 Agreement by and among MSV, Motient, TMI,
    the DOJ and the FBI is attached to the *MSV 2001 Order*, 16 FCC Rcd
    at 20483-20501.

[^136]: Executive Branch Petition at 2.

[^137]: *Id.*

[^138]: *See Foreign Participation Order*, 12 FCC Rcd at 23919-21 ¶¶
    61-66.

[^139]: *Id*. at 23919 ¶ 62.