Document ID: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-caDC-08-01080/USCOURTS-caDC-08-01080-0/pdf.json

Parties Involved:
Federal Communications Commission
Appellee
Morris Communications, Inc.
Appellant

Document Text:

United States Court of Appeals

FOR THE DISTRICT OF COLUMBIA CIRCUIT

Argued March 24, 2009 Decided May 12, 2009

No. 08-1080

MORRIS COMMUNICATIONS, INC.,

APPELLANT

v.

FEDERAL COMMUNICATIONS COMMISSION,

APPELLEE

On Appeal of an Order 

of the Federal Communications Commission

Frederick M. Joyce argued the cause for the appellant.

Ronald E. Quirk Jr. entered an appearance.

Maureen K. Flood, Counsel, Federal Communications

Commission, argued the cause for the appellee. Matthew B.

Berry, General Counsel, Jacob M. Lewis, Associate General

Counsel, and Richard K. Welch, Acting Deputy Associate

General Counsel, Federal Communications Commission were

on brief. Daniel M. Armstrong, Associate General Counsel, and

Joseph R. Palmore and James M. Carr, Counsel, Federal

Communications Commission, entered appearances.

Before: GINSBURG, HENDERSON and KAVANAUGH, Circuit

Judges.

USCA Case #08-1080 Document #1180321 Filed: 05/12/2009 Page 1 of 16
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Opinion for the Court filed by Circuit Judge HENDERSON.

KAREN LECRAFT HENDERSON, Circuit Judge: Morris

Communications, Inc. (Morris), a family-owned mobile, paging

and communications service provider, appeals the Federal

Communications Commission (FCC or Commission) order

denying its requests to waive the automatic cancellation of its

nine specialized mobile radio (SMR) licenses. For the reasons

set forth below, we affirm the Commission’s order.

I.

On April 15, 1996, the FCC notified Morris that it had

successfully bid for nine 900 MHz SMR licenses covering

certain areas in the southeast United States. FCC Announces

Winning Bidders in the Auction of 1,020 Licenses to Provide

900 MHz SMR in Major Trading Areas, 11 F.C.C.R. 18,599,

18,611-22 (Apr. 15, 1996). Morris chose to pay its winning bids

in quarterly installments, which made the licenses “conditioned

upon the full and timely performance of [Morris’s] payment

obligations under the installment plan.” 47 C.F.R.

§ 1.2110(d)(4) (1994). Indeed, Morris’s licenses expressly

stated that “authorization is conditioned upon the full and timely

payment of all moneys due pursuant to sections 1.2110 and

90.812 of the Commission’s rules and the terms of the

Commission’s installment plan . . . . Failure to comply with this

condition will result in the automatic cancellation of this

authorization.” E.g. Morris Commc’ns, Inc., License KNNY352

at 7 (Oct. 16, 1996). 

For five years Morris made the quarterly payments either on

time or within the two consecutive 90-day automatic grace

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1

 47 C.F.R. § 1.2110(g)(4) (2006) provides:

Any licensee that fails to submit its quarterly

payment on an installment payment

obligation . . . may submit such payment [plus a

5% late fee] on or before the last day of the next

quarter . . . without being considered delinquent.

. . . If any licensee fails to make the Required

Installment Payment on or before the last day of

the first additional quarter . . . , the licensee may

submit its Required Installment Payment on or

before the last day of the next quarter [plus a

10% late fee]. . . . If an eligible entity obligated

to make installment payments fails to pay the

total Required Installment Payment, interest and

any late payment fees associated with the

Required Installment Payment within two

quarters (6 months) of the Required Installment

Payment due date, it shall be in default, its

license shall automatically cancel, and it will be

subject to debt collection procedures.

47 C.F.R. § 1.2110(g)(4)(i)-(iv).

periods authorized by 47 C.F.R. § 1.2110(g).1 On July 31, 2001,

however, Morris failed to make the installment payment on each

of its nine licenses. It also failed to make payment plus late fees

by the end of the two 90-day grace periods, that is, January 31,

2002. Earlier in January 2002, the FCC began outsourcing its

loan servicing to a private vendor, Colson Services Corporation

(Colson). Colson had notified Morris by letter in early January

that it was taking over the FCC’s loan servicing and that Morris

was to send all payments to Colson. It enclosed a form that

required Morris to designate an employee responsible for bill

handling. Morris returned the form, designating its controller as

the responsible employee. Colson sent the January 31, 2002

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installment payment notices to Morris but without addressing

them to the controller and the notices did not reach Morris’s

controller until February 4, 2002—four days after the payments

were due. Morris remitted the full amount owed to the FCC on

February 5, 2002. 

On April 26, 2002, the FCC notified Morris that “an Event

of Default ha[d] occurred,” that “the License[s] automatically

cancelled by operation of the Rules and [that] the Commission

[wa]s commencing debt collection procedures.” Letter from

Mark Reger, CFO, FCC, to Morris Communications, Inc. at 1

(Apr. 26, 2002). The letter further noted that “all of [Morris’s]

obligations . . . ha[d] been accelerated.” Id. at 2. On May 2,

2002, Morris requested a waiver from the automatic cancellation

rule. In its request, Morris explained the circumstances leading

up to its late February 5, 2002 installment payments and asked

the Commission to review its request “as expeditiously as

possible.” Letter from Frederick M. Joyce and Marianne Roach

Casserly, Attorneys, Alston & Bird LLP, to Mark Reger, CFO,

FCC, at 5 (May 2, 2002) (Waiver Request). On May 6, 2002,

Morris again wrote to the Commission, “request[ing] that the

Commission stay the effectiveness of the decisions set forth in

[the Commission’s] letters dated April 26, 2002.” Letter from

Frederick M. Joyce and Marianne Roach Casserly, Attorneys,

Alston & Bird LLP, to Mark Reger, CFO, FCC, at 1 (May 6,

2002) (Request for Stay). 

The FCC responded on May 9, 2002, acknowledging receipt

of the Waiver Request and informing Morris that “[w]ithin 30

days of this letter we will mail you either a resolution to your

item or a letter telling you when you can expect a resolution.”

Letter from Mark A. Reger, CFO, FCC to Frederick M. Joyce

and Marianne Roach Casserly, Attorneys, Alston & Bird LLP,

at 1 (May 9, 2002). Thirty days came and went, however, and

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2

 Morris completed construction of the stations by December 31,

2002, because otherwise “its authorization terminate[d] automatically

(in whole or in part as set forth in the service rules), without specific

Commission action, on the date the construction or coverage period

expires.” 47 C.F.R. § 1.946(c); see also id. § 90.665. December 31,

2002 was the date the construction period ended for the two stations.

Morris heard nothing from the Commission. More time elapsed

and, even after Morris’s repeated telephone calls and written

inquiries, the Commission did not respond. Morris continued to

make timely payments on its nine licenses until October 29,

2002. At that point, Morris stopped making payments on seven

of the nine licenses.

Not having received any reply from the FCC by December

2002, Morris then began construction on the two SMR stations

on whose licenses it had continued making payments and

notified the FCC of the stations’ construction.2

 Letter from

Frederick M. Joyce and Ronald E. Quirk, Jr., Attorneys, Alston

& Bird LLP, to William Kunze, Chief, Commercial Wireless

Division, Wireless Telecommunications Bureau, FCC (Jan. 14,

2003). Morris also submitted—and the FCC processed—two

corresponding Notifications of Buildout. See 47 C.F.R.

§ 1.946(d) (buildout notification required within 15 days of end

of construction period).

On January 21, 2003, Morris filed another Waiver Request

with the FCC. In it, Morris asked the FCC for (1) “a one-year

extension of time, up to and including December 31, 2003, to

fully construct a digital 900 MHz SMR system in all its

authorized [Major Trading Areas],” (2) a “waiver of [section]

1.946(e) of the Commission’s rules, which states that requests

for extension of time to construct must be filed before the

expiration of the construction of coverage period,” and (3) a

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one-year forbearance of its installment payment obligations on

each of its nine licenses. Morris Commc’ns, Inc., Petition for

Rule Waiver at 6 (Jan. 21, 2003). In support of its request,

Morris noted “the unique and unusual regulatory uncertainty

surrounding [its] licenses” and “the fact that demand for 900

MHz SMR services in the vast majority of these predominantly

rural markets simply has not occurred.” Id. at 7. 

On April 25, 2005, after almost three years of nothing but

silence from the Commission, the Auctions and Spectrum

Access Division (Division) finally denied both of Morris’s

waiver requests noting that “Morris ha[d] failed to demonstrate

that the underlying purpose of the Commission’s payment rule

would not be served, or would be frustrated, by its application

in this particular case.” Ronald E. Quirk, Jr., 20 F.C.C.R. 8176,

8179 (Apr. 25, 2005). The Division also noted that “Morris

acknowledges that it is facing financial difficulties and that it

cannot . . . continue to make its installment payments for these

licenses.” Id. at 8181. Morris thereafter stopped making

installment payments on its remaining two licenses.

On May 25, 2005, Morris appealed the Division’s decision

to the full Commission. In its application for review, Morris

argued, inter alia, that the Division ignored FCC precedent in

denying Morris’s waiver requests, was equitably estopped from

revoking Morris’s licenses, did not provide a reasoned

explanation for its action and denied Morris procedural due

process. While review was pending, Morris offered to negotiate

a settlement agreement with the FCC whereby it could retain its

nine licenses, fulfill its payment obligations for each license

within one year and continue to make its installment payments

for each of the licenses until paid in full. The Commission

eventually rejected the offer. 

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In mid-December 2005 Morris asked the Commission for

special temporary authority (STA) to operate its two constructed

SMR stations for a period of 180 days or until the FCC issued a

decision, whichever occurred first. The Commission granted the

STA for both stations on December 28, 2005. On June 8, 2006,

Morris requested an extension of the STA for an additional 180-

day period, which request the FCC appears to have granted.

On February 21, 2008, almost three years after Morris

petitioned for review, the Commission issued its decision

denying Morris’s application for review. Morris Commc’ns,

Inc., 23 F.C.C.R. 3179 (Feb. 21, 2008). The Commission

determined that “Morris ha[d] failed to show that, by denying its

waiver requests, the Division treated it differently than similarly

situated entities” and the “Division’s denial was therefore not an

abuse of discretion.” Id. at 3186 ¶ 15. The FCC stated that “the

Commission has explained unequivocally that, because parties

remain obligated for the full amount of their debt following their

default on installment payments, the Commission’s acceptance

of a payment after such a default does not, by itself, constitute

a constructive waiver of the automatic cancellation rule or

revive an automatically canceled license.” Id. at 3187 ¶ 18.

Moreover, the Commission noted that “[t]he Division correctly

found Morris’s assertion that it was uncertain as to the exact

amount owed, and that it received its payment notice late,

insufficient by itself to justify a waiver of the installment

payment rules” because FCC precedent makes clear that it is

“the licensee’s responsibility to know the amounts and due dates

of its installment payments.” Id. at 3188-89 ¶ 21. Regarding

Morris’s claim of equitable estoppel, the Commission concluded

that it “ha[d] done nothing, by either act or omission, that would

have led Morris to believe that the licenses had not

automatically cancelled.” Id. at 3192 ¶ 30. The Commission

further determined that the Division acted reasonably in denying

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Morris’s waiver requests, id. at 3193-97, and that Morris had not

been deprived of due process, id. at 3197-3201. Morris then

timely appealed to this Court. See 47 U.S.C. § 402(b)(5).

II.

A. Abuse of Discretion

Morris submits that the FCC abused its discretion in failing

to grant Morris’s two waiver requests because it failed to follow

precedent waiving “its automatic cancellation rules in

circumstances either identical to or far less compelling than

Morris’[s] situation.” Br. of Appellant at 10. We will vacate the

denial of a waiver “only when ‘the agency’s reasons are so

insubstantial as to render that denial an abuse of discretion.’”

BDPCS, Inc. v. FCC, 351 F.3d 1177, 1181 (D.C. Cir. 2003)

(quoting Mountain Solutions, Ltd. v. FCC, 197 F.3d 512, 517

(D.C. Cir. 1999)). Under this standard, the Commission abuses

its discretion if it fails to “provide adequate explanation before

it treats similarly situated parties differently.” Petroleum

Commc’ns, Inc. v. FCC, 22 F.3d 1164, 1172 (D.C. Cir. 1994).

“[H]owever, the agency’s strict construction of a general rule in

the face of waiver requests is insufficient evidence of an abuse

of discretion.” Mountain Solutions, Ltd., 197 F.3d at 517.

Under the Commission’s regulations, a waiver request may

be granted if:

(i) The underlying purpose of the rule(s)

would not be served or would be frustrated

by application to the instant case, and . . . a

grant of the requested waiver would be in the

public interest; or,

USCA Case #08-1080 Document #1180321 Filed: 05/12/2009 Page 8 of 16
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(ii) In view of unique or unusual factual

circumstances of the instant case, application

of the rule(s) would be inequitable, unduly

burdensome or contrary to the public

interest, or the applicant has no reasonable

alternative.

47 C.F.R. § 1.925(b)(3). The FCC may grant a waiver of the

automatic cancellation of a license due to a missed payment

deadline if the deadline was missed due to “inadvertence or

administrative error.” Winstar Broad. Corp., 17 F.C.C.R. 6126,

6128 (Mar. 25, 2002); see Delta Radio, Inc. v. FCC, 387 F.3d

897, 901 (D.C. Cir. 2004) (“The FCC’s policy is to grant

waivers only for cases in which administrative error caused the

due date to be missed.”). To establish inadvertence or

administrative error, the licensee must show that it

demonstrated prior compliance with

Commission rules, good faith, or prompt

action to rectify the delinquency; there was no

record that the payment shortfall was part of

a deliberate effort to delay payment; the

public interest would not be served by rigid

enforcement of the payment deadline; and

some flexibility [is] appropriate in addressing

a minor delinquency with respect to the

payment.

Winstar, 17 F.C.C.R. at 6128-29. In Meredith S. Senter, Jr.,

Esq., 14 F.C.C.R. 5003 (FCC Auctions & Indus. Analysis Div.

Feb. 2, 1999), for example, the FCC granted a waiver to a

licensee that had made its first installment payment “nearly five

months after th[e] payment was due.” Id. at 5003. The

regulations in force at the time “provided that an entity that was

more than 90 days delinquent in any installment payment was in

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default; however, upon default or in anticipation of default,

licensees were permitted to request a grace period of three to six

months.” Id. Even though the licensee did not request a grace

period, the Commission granted the waiver, “recogniz[ing] that

the acceptance of [the licensee’s] late payment could have been

construed as a waiver of the payment deadline” and

“acknowledg[ing] that [the licensee’s] record of timely

payments over a period of nearly two years since payment of the

second installment [wa]s indicative of a commitment on the

[licensee’s] part . . . to meet its payment obligations.” Id. at

5004; see also Lloyd W. Coward, Esq., 14 F.C.C.R. 2173, 2174

(FCC Wireless Telecomm. Bureau Jan. 29, 1999) (waiver

granted where licensee missed installment payment deadline and

did not request grace period but FCC nevertheless accepted late

payment).

In Lakeland PCS LLC, 15 F.C.C.R. 23,733 (FCC

Commercial Wireless Div. Nov. 27, 2000), the FCC granted a

waiver where the licensee missed the installment payment plus

both 90-day grace periods, remitting payment one day after the

second grace period had ended, but continued to receive

payment notices from the FCC after that date and “timely made”

payment after receipt of the notices. Id. at 23,734. The

Commission concluded that “the circumstances presented here

are consistent with previous instances, where, as a result of

administrative oversight, we have acknowledged that a

constructive waiver of the installment payment deadlines has

occurred.” Id. at 23,735. 

In David Irwin, 19 F.C.C.R. 4011 (FCC Auctions & Indus.

Analysis Div. Mar. 3, 2004), the FCC granted a waiver to a

licensee that had failed to make a timely quarterly installment

payment because the payment it had forwarded via certified mail

to the FCC three days before the due date arrived after the due

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3

 This fact also distinguishes this case from Coward because there,

too, the licensee lacked notice that the FCC’s acceptance of a postdefault installment payment did not act as constructive waiver. 14

F.C.C.R. at 2173-74. As noted earlier, the Commission has since

made clear that “mere acceptance of a payment after cancellation

w[ill] not constitute a constructive waiver of the automatic

cancellation rule.” Licenses of 21st Century Telesis Joint Venture, 16

F.C.C.R. 17,257, 17,261 ¶ 12 n.24 (Sept. 21, 2001) (citing Lakeland,

15 F.C.C.R. at 23,735 n.11).

date. Id. at 4011-12. Believing its payment was timely, the

licensee failed to pay the late fees for more than two quarters

and its two licenses were then automatically cancelled. Id. at

4012. In the interim, however, the licensee “requested a

statement of all amounts then-outstanding in connection with the

installment payment plan for both licenses and paid the full

amount, including all amounts assessed as late fees.” Id. at

4015. The FCC granted the request but noted that “[i]f . . . the

facts of this case had provided any indication that [the licensee]

lacked the financial wherewithal, basic responsibility or

willingness to pay the equivalent of the late fees by the January

31, 2001 deadline, then it would appear that a waiver would not

be justified.” Id. (emphasis added). 

Relying on this authority, Morris asserts that the

Commission abused its discretion in failing to grant Morris a

waiver. The Commission distinguished the above-cited

precedent, however, and, we conclude, did so reasonably. First,

the Commission concluded that Senter was distinguishable

because, unlike the licensee in Senter, Morris was on notice that

the Commission’s acceptance of its post-default installment

payments did not constitute a constructive waiver.3

 Moreover,

unlike the Senter licensee, Morris stopped making installment

payments on seven of its nine licenses less than one year after its

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4

 Morris so stated in its second Waiver Request, asserting, inter

alia, (1) a request for a one-year waiver “would allow [it] to utilize the

financial resources that it was using for installment payments to build

[an SMR network]”; (2) it “lack[ed] . . . appropriate equipment and . . .

demand for 900 MHz SMR services in the vast majority of [its]

predominantly rural markets simply ha[d] not occurred”; and (3)

“[d]ue to the economic downturn, [it] has had reduced financial

resources which have been exacerbated by its installment payments on

its 900 MHz SMR licenses, which have not yet generated any

revenue.” Morris Commc’ns, Inc., Petition for Rule Waiver at 6-7, 14

(Jan. 21, 2003). 

5

 In addition, Morris’s financial difficulties as well as its decision

to stop post-default payments make Morris critically different from the

Irwin licensee.

default and stated post-default that it was in financial distress.4

Morris Commc’ns, Inc., 23 F.C.C.R. at 3187-88. The

Commission also reasonably distinguished Lakeland, noting that

there, unlike here, “the Commission had continued to send

payment notices to the former licensee despite the automatic

cancellation of the license.” Id. at 3188 (citing Lakeland, 15

F.C.C.R. at 23,734-35). In Lakeland, the Commission also

stated that, without more, “late payment could not revive an

automatically cancelled license.” 15 F.C.C.R. at 23,735.

Although Morris did not bring Irwin to the FCC’s attention, the

FCC’s reasoning in distinguishing Senter and Lakeland applies

to distinguish Irwin as well.5

 This “court will uphold [an

agency’s] findings, though of less than ideal clarity, if the

agency’s path may reasonably be discerned” so long as it is

“satisfied that the agency has taken a hard look at the issues with

the use of reasons and standards.” Greater Boston Television

Corp. v. FCC, 444 F.2d 841, 851 (D.C. Cir. 1970). This the

Commission has done. Accordingly, we do not believe that

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6

 Morris also argues that the FCC erred because it “offered no

rational explanation, and no public interest justification, for refusing

to grant Morris a waiver for the ‘administrative error’ that led to a

brief, five day payment delay.” Br. of Appellant at 13. In its order,

however, the Commission noted that “the Division correctly explained

that the payment of winning bids in compliance with the

Commission’s rules is critical to realizing the public interest objectives

of Section 309(j) of the Communications Act” and “further explained

that the Commission’s rules presume that the entity that bids the most

for a license in an auction is the entity that places the highest value on

the use of the spectrum; that such entities are presumed to be those

best able to put the licenses to their most efficient use for the benefit

of the public; and that requiring licensees to demonstrate their ability

to pay as a condition of continuing to hold licenses is essential to an

efficient licensing process.” 23 F.C.C.R. at 3194 ¶ 34.

“‘the agency’s reasons are so insubstantial as to render [its

waiver] denial an abuse of discretion.’” BDPCS, Inc., 351 F.3d

at 1181 (quoting Mountain Solutions, Ltd., 197 F.3d at 517).6

B. Equitable Estoppel

Morris further contends that the FCC should be estopped

from revoking its licenses because, by assuring Morris in the

May 9, 2002 letter that the Commission would respond to its

Waiver Request in thirty days, by accepting Morris’s late

installment payments and by expressly acknowledging that

Morris had built and was operating two SMR stations (by

processing Morris’s Notifications of Buildout and by granting

STAs for the stations), the Commission made a definite

representation to Morris on which Morris reasonably relied to its

harm. To apply equitable estoppel against the government, a

party must show that (1) “there was a ‘definite’ representation

to the party claiming estoppel,” (2) the party “relied on its

adversary’s conduct in such a manner as to change his position

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for the worse,” (3) the party’s “reliance was reasonable” and (4)

the government “engaged in affirmative misconduct.” Graham

v. SEC, 222 F.3d 994, 1007 (D.C. Cir. 2000) (internal quotations

omitted); LaRouche v. FEC, 28 F.3d 137, 142 (D.C. Cir. 1994)

(internal quotations omitted); see also GAO v. Gen. Accounting

Office Pers. Appeals Bd., 698 F.2d 516, 526 (D.C. Cir. 1983)

(“Estoppel generally requires that government agents

engage—by commission or omission—in conduct that can be

characterized as misrepresentation or concealment, or, at least,

behave in ways that have or will cause an egregiously unfair

result.”).

First, the May 9, 2002 letter made no representation one way

or the other regarding Morris’s Waiver Request but stated only

that “[w]ithin 30 days of this letter we will mail you either a

resolution . . . or a letter telling you when you can expect a

resolution.” Letter from Mark A. Reger, CFO, FCC to Frederick

M. Joyce and Marianne Roach Casserly, Attorneys, Alston &

Bird LLP (May 9, 2002). Nowhere did the Commission

represent that, if it failed to respond within that period, Morris

should deem the waiver granted. Second, the FCC’s acceptance

of Morris’s post-default installment payments was not a

“definite representation” that waiver was granted because

Morris had been expressly warned in the April 26, 2002 default

letter that “[a]ny amounts that were, or will be, tendered after

the acceleration are being applied to the sums owing under the

Loan Documents . . . [and the] acceptance by the Commission

of any amounts comprising less than the entire debt shall not be

deemed to be a cure of the Borrower’s Default, a waiver of any

other default under the Rules or Loan Documents, or a

reinstatement by the Commission of the terms of the Loan

Documents.” Letter from Mark Reger, CFO, FCC, to Morris

Communications, Inc. at 2 (Apr. 26, 2002). Finally, neither the

FCC’s receipt of Morris’s Notifications of Buildout nor its

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7

 To the extent Morris argues that the Commission’s processing of

the Notifications of Buildout as well as the two STAs violated 47

C.F.R. § 1.1910(b)(2), which prohibits the Commission “from taking

action on any application ‘by any entity found to be delinquent in its

debt to the Commission,’” Br. of Appellant at 14 (quoting 47 C.F.R.

§ 1.1910(b)(2)), the argument is waived because Morris failed to raise

it before the Commission. Qwest Corp. v. FCC, 482 F.3d 471, 474

(D.C. Cir. 2007) (“‘[This Court] generally lack[s] jurisdiction to

review arguments that have not first been presented to the

Commission.’”) (citation omitted).

approval of the STAs constitutes a “definite” representation

regarding Morris’s Waiver Request. Moreover, while the

Commission’s three-year silence is egregious, it does not

constitute “affirmative misconduct.” Accordingly, Morris has

not shown that equitable estoppel should be applied to the

Commission. 

C. Morris’s Remaining Arguments

Morris’s remaining arguments are also without merit.

Although the Commission failed to comply with 47 C.F.R.

§ 1.1911(e), requiring it to respond to “communications from [a]

debtor[] within 30 days whenever feasible,” its non-compliance

does not affect its automatic cancellation authority. See 47

C.F.R. § 1.1902(f) (“Nothing in this subpart [(encompassing

§ 1.1911(e))] shall supercede [sic] or invalidate other

Commission rules, such as the . . . general competitive bidding

rules . . . or the service specific competitive bidding rules, as

may be amended, regarding the Commission’s rights, including

but not limited to the Commission’s right to cancel a license or

authorization, obtain judgment, or collect interest, penalties, and

administrative costs.”) (emphasis added).7

 

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Morris’s administrative due process argument—that is, the

FCC failed to provide an “administrative hearing prior to any

revocation of its authorizations to operate the two constructed

SMR stations,” Br. of Appellant at 24—incorrectly assumes that

the Commission in fact authorized full operation of the SMR

stations. It did not. Rather, it merely granted Morris special

temporary authority while Morris’s appeal was pending. As for

Morris’s contention that the Commission violated its right to

administrative due process by automatically cancelling the nine

SMR licenses, it is also without merit. The Communications

Act of 1934 provides that “no . . . license shall be construed to

create any right, beyond the terms, conditions, and periods of the

license,” 47 U.S.C. § 301, and Morris’s licenses stated on their

face that they were “conditioned upon the full and timely

payment of all moneys due.” E.g. Morris Commc’ns, Inc.,

License KNNY352 at 7 (Oct. 16, 1996). Its licenses were thus

contingent on Morris’s timely payment of all amounts owing;

once Morris failed to make the January 31, 2002 payments, the

licenses themselves also lapsed. See L.B. Wilson, Inc. v. FCC,

170 F.2d 793, 798 (D.C. Cir. 1948) (license “right is limited in

time and quality by the terms of the license”). 

For the foregoing reasons, we affirm the order of the Federal

Communications Commission.

So ordered.

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