Bad means for a good end?
It would be a good thing for unused spectrum to start being used. It would increase wireless competition, and not really cost anything.
However, the success or failure of Lightsquared shouldn't factor in to any DoD decision. Maybe they can use some more spectrum for their satellites, though it takes them decades to actually get a satellite up. They probably have some 15-year plan for all of their other spectrum, involving pagers or some other obsolete technology.
It would probably cost them 100 million dollars and 5 years to even decide on what spectrum to swap. Sorry, Lightsquared!
Or they can hold on to it.
GPS is supposed to be off the l1/l2 freqs by 2020 (probably delayed 'til 2023-26 due to budget and technical problems) So LightSquared COULD petition to try again then.
OR the can use the spectrum for Sat. as intended.
OR the can sell it to someone else, for Sat use.
OR they could return it to the Gov't for resale ( like Falcone will let that happen)