Opinion ID: 184917
Heading Depth: 2
Heading Rank: 1

Heading: PLMRS's Challenge to the Third Report & Order

Text: 8 Although it expressly supports the Commission's designation of the licenses for commercial use in the Third Report and Order, PLMRS claims the Commission acted arbitrarily and capriciously both in deciding to auction those licenses and in returning the application it filed under the previously promulgated rules. Its support for the Commission's designation of the licenses for commercial use in 1997 places in a rather odd light its ultimate contention that the agency must limit the applicant pool to entities that applied for the licenses in 1991, when they were designated for non-commercial use. 9 In permitting additional applicants to compete for the newly-designated commercial licenses, the Commission explained: 10 [B]ecause the nature of the 220 MHz service is undergo-ing such substantial change, it would be unfair to pre-clude new applicants from having the opportunity toapply for these 220 MHz licenses. In 1991, when thepending applications were filed, parties interested inusing the 220 MHz spectrum may have decided not toapply for these licenses because the rules precluded alicensee from offering the type of service that theseparties desired to offer, such as primary fixed service,paging, or nationwide commercial service. 11 Third Report and Order, 12 F.C.C.R. 10,943, p 200. PLMRS claims there would be no such unfairness because the Commission had in the Original Order designated four other licenses for nationwide commercial use. Anyone seeking a commercial license in 1991, PLMRS reasons, had an opportunity to apply for it, and nothing in the record supports the FCC's finding that such entities opted out of the 1991 filing process because the rules precluded the type of service that these parties desired to offer. 12 This is a non sequitur. That one had an opportunity to apply for other commercial licenses does not justify denying one an opportunity to file for the formerly non-commercial licenses once that restriction is lifted. In any case, PLMRS itself represents that in 1991 there were 140 applicants for the four commercial licenses. The Commission reasonably concluded that some of those applicants may have decided not to apply for the four licenses now at issue because they were not then designated for commercial use. See id. (PLMRS acknowledges that a commercial license is more valuable than a non-commercial license.) When an agency is obliged to make policy judgments where no factual certainties exist or where facts alone do not provide the answer, our role is ... limited [to requiring] only that the agency so state and go on to identify the considerations it found persuasive. Melcher v. FCC, 134 F.3d 1143, 1152 (D.C. Cir. 1998). The Commission easily meets that standard here. 13 The Commission also gave an affirmative reason grounded in public policy for expanding the existing pool of applicants:Opening a filing window for all interested applicants ... will increase the likelihood that competitive processes will trigger the delivery of a broad array of services to customers at reasonable prices. Third Report and Order, 12 F.C.C.R. 10,943, p 200. PLMRS does not even attempt to cast doubt upon this justification for the Commission's change of course. 14 Instead PLMRS next argues that the Commission, by returning all pending applications and electing to auction the licenses, invited unreasonable delay because it was inevitable that the original applicants would challenge those actions in court. As the Commission noted in the final rule, however, had it not returned the applications of PLMRS and others it would just as certainly have faced a court challenge from parties interested in obtaining commercial licenses. See id. p 203. We give such a predictive judgment our deference, of course. See Melcher, 134 F.3d at 1152; FCC v. National Citizens Comm. for Broad., 436 U.S. 775, 814 (1978) ([A] forecast of the direction in which future public interest lies necessarily involves deductions based on the expert knowledge of the agency). Deference aside, we do not endorse PLMRS's suggestion that an agency must gauge the public interest with reference to the litigation incentives facing private parties. To charge an agency with the delay imposed upon it by others--in effect to encourage the agency to adopt the course found least objectionable to interested parties-would hardly seem to further the public interest, and would create a perverse incentive for parties to threaten the agency with litigation. 15 PLMRS also contends that because the Commission in 1993 granted the four licenses it had designated for nationwide commercial use under the Original Order, the agency acted arbitrarily and capriciously by failing to process PLMRS's application at the same time. As the agency explains, however, it processed the commercial applications in 1993 because the rules promulgated in the Original Order to govern nationwide commercial licenses had become final and were not subject to further agency reconsideration. The Commission did not process the applications for nationwide noncommercial licenses in 1993 because there were pending before it three petitions for reconsideration of the rules governing assignment of those licenses. See Notice: November 19, 1992, Date Established for Commercial Nationwide 220-222 MHz Band Applicants to File Application Amendments to Satisfy Entry Criteria, 57 Fed. Reg. 49,475, 49,475 (1992). We see nothing arbitrary or capricious in the Commission's decision to defer issuing licenses until it has finally settled upon the rules for doing so. See Chadmoore Communications v. FCC, 113 F.3d 235, 242 (D.C. Cir. 1997) (holding disparate treatment arbitrary only if parties are similarly situated). 16 PLMRS's final two contentions, made only in passing, may be rejected in kind; neither raises a question open in this circuit. First, PLMRS did not, by virtue of filing its application, obtain the right to have it considered under the rules then applicable. See id. at 241. Second, because PLMRS obtained no such right, the Commission's subsequent change in the regulations was not retroactive, let alone impermissibly retroactive, rulemaking. See DIRECTV, Inc. v. FCC, 110 F.3d 816, 825-26 (D.C. Cir. 1997) (holding that because Commission's original order did not grant right to any particular broadcast channels, subsequent decision to auction those channels not retroactive though it upset expectations based upon prior law). 17 We therefore conclude that the Commission's decision to auction the licenses and to return PLMRS's application was neither arbitrary nor capricious. 18