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LightSquared Prepares For FCC Lawsuit
Hires Two Top Legal Guns to Pursue Case
by Karl Bode 06:06PM Tuesday Mar 13 2012 Tipped by FFH5 See Profile
LightSquared is effectively dead in the water after the FCC denied the company a necessary spectrum waiver to operate their planned LTE network. The company's CEO recently bailed from the venture, and reports last week emerged that Sprint was getting ready to scrap their relationship with the company. LightSquared chief financial backer Phillip Falcone is facing a lawsuit from investors and numerous unrelated SEC inquiries. What's LightSquared's next step? To sue, of course.

Last October LightSquared stated they'd sue the FCC if they backed away from the waiver, and it appears that Falcone is now assembling the legal muscle to follow through on that threat. Politico notes that LightSquared has hired "two of the most prominent conservative litigators in the country," Ted Olson and Eugene Scalia, to presumably argue the FCC over reached:
quote:
What happened to LightSquared is “an egregious example” of the government encouraging a company to invest an enormous amount of money to meet a national objective and then “pulling the rug out from under them capriciously and precipitously,” Olson told POLITICO. “On the face of things, it looks to me like the government has acted arbitrarily after inducing the expenditure of an enormous number of resources.
Of course the FCC's initial support of the project came before numerous reports made it very clear that LightSquared's planned network would have a disastrous impact on nationwide GPS functionality.

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Jim_in_VA

join:2004-07-11
Cobbs Creek, VA
kudos:4

Its dead ...

time to move along.

moddestmike

join:2009-01-26
Houston, TX

Re: Its dead ...

agreed, die already. They were given ample opportunity to prove their strategy was feasible and they didn't.

And this coming from someone who was in LS's corner from the beginning.
BiggA

join:2005-11-23
EARTH

Thank god

The FCC stands up to LS trying to kill GPS in order to try and build an LTE network (like we need ANOTHER one of those).

FFH5
Premium
join:2002-03-03
Tavistock NJ
kudos:5

Falcone mad that bought pols turned on him; out for blood

Falcone was in a high stakes poker game and went all-in on the FCC OK'ing his play. He thought he fixed the game by buying all the key pols in Washington and when some key players couldn't be bought(military, FAA) or wouldn't stay bought(White House), he lost his bet. He is now out for blood and wants to get his deal approved or get repaid for all the billions he spent. Not surprised he hired 2 Conservative lawyers because he wants to punish the White House for his betrayal.
--
The nine most terrifying words in the English language are, I'm from the government and I'm here to help.
»www.politico.com/2012-election/


mix

join:2002-03-19
Utica, MI

Re: Falcone mad that bought pols turned on him; out for blood

The reality is, there are just way to many high end gps receivers out there serving in critical roles that could be rendered inoperable or at least not reliable by LightSquared's plan. I don't think their is anyone who wouldn't agree more wireless competition is a good thing. The costs and the pain in the ass to make this work on these frequencies is just too high for way to many people and organizations. Hopefully the FCC will eventually come up with some sort of spectrum swap.
MrHappy316
Wish I had my tank
Premium
join:2003-01-02
Monterey, CA

Re: Falcone mad that bought pols turned on him; out for blood

Why spectrum swap, there's no incentive. Lightsquared gambled and lost why should they get much more valuable airspace since their gamble didn't work? It's like letting a poker player back in with X10 more than he came in with in free rebuy money that cost him nothing
moonpuppy

join:2000-08-21
Glen Burnie, MD
What Falcone needs to do is out who he bought off. Yeah, it is the nuclear option but at least he won't go down alone.

MertJen

@ut.us

Explain

Now if I understand the history to this correctly, LightSquared obtained spectrum in order to create an LTE network. It was proved by someone that their LTE network could cause interference with GPS devices.

»www.pnt.gov/interference/lightsquared/
"Although LightSquared will operate in its own radio band, that band is so close to the GPS signals that most GPS devices pick up the stronger LightSquared signal and become overloaded or jammed. "

I love hating on LightSquared like everybody else but I tend think they got screwed by every GPS maker out there and the FCC.

BGB
Wants moar interwebz
Premium
join:2009-07-09
Waterloo, ON
Reviews:
·TekSavvy Cable

1 recommendation

Re: Explain

My understanding...

1) They asked FCC for a TEST license
2) FCC gave a TEST license on condition that they could prove it would not interfere with GPS
3) Their product interfered with GPS
4) They could not fix the product so it did not interfere
5) FCC revoked TEST license
6) Lightsquare sued because they could not keep their promises...

Time for Lightsquare to throw in the towel IMHO... GPS was around a lot longer than them...

KrK
Heavy Artillery For The Little Guy
Premium
join:2000-01-17
Tulsa, OK

Re: Explain

Bingo, you have the basics.

Only thing you left out was the money Falcone through around in Washington thinking that they could "Buy" the license anyway even though they failed condition #2.

AT&T also made this mistake with the T-Mobile merger, IMHO. They figured they could just throw money around, make bogus job promises, and hey presto, deal approved.

They failed as well.
--
"Fascism should more properly be called corporatism because it is the merger of state and corporate power." -- Benito Mussolini
MrHappy316
Wish I had my tank
Premium
join:2003-01-02
Monterey, CA

Re: Explain

Only thing were missing is there is a easy way to fix it, but it won't be pretty for LS. Given enough time though they could make a profit
moonpuppy

join:2000-08-21
Glen Burnie, MD
said by BGB:

My understanding...

1) They asked FCC for a TEST license
2) FCC gave a TEST license on condition that they could prove it would not interfere with GPS
3) Their product interfered with GPS
4) They could not fix the product so it did not interfere
5) FCC revoked TEST license
6) Lightsquare sued because they could not keep their promises...

Time for Lightsquare to throw in the towel IMHO... GPS was around a lot longer than them...

I'll add this addendum:

4.5) LS blamed GPS industry for their interference.

They thought they should not be one to fix it but everyone else should fix the problem for them.

Oh_No
Trogglus normalus

join:2011-05-21
Chicago, IL
said by MertJen :

I love hating on LightSquared like everybody else but I tend think they got screwed by every GPS maker out there and the FCC.

WTF???
GPS makers have nothing to do with it.
The american taxpayers paid for our GPS system. The first satellites were put up in the 1970s.

We pay GPS makers to make a product so we can use the GPS network we already paid for.
GPS makers make the devices for us to the FCC specs and to the laws of physics. How did they do anything wrong???

jseymour

join:2009-12-11
Waterford, MI
said by MertJen :

I love hating on LightSquared like everybody else but I tend think they got screwed by every GPS maker out there and the FCC.

This isn't a question of how much fun it is to "hate on LightSquared," and LightSquared didn't get "screwed by every GPS maker out there and the FCC." To review: LightSquared acquired a company that had some satellite communications spectrum, and, it turns out, they made a deal with another company to purchase other satellite communications spectrum. Then they tried to re-purpose that SatCom spectrum to purely terrestrial use, employing much higher-powered transmitters than that for which the allocation was originally intended. The FCC, for whatever reasons (it looks like politics may have played a role), told them "Okay, we'll conditionally grant you a waiver, said condition being your ability to prove you can operate the way you want on a non-interfering basis." LightSquared was not able to satisfy the conditions for the waiver, so the waiver was revoked. So much for "being screwed by the FCC." As for GPS makers: They were supposed to increase the cost, complexity and size of their products by designing them for conditions that did not exist, and were never supposed to exist? (N.B.: Some radio-knowledgeable people, myself amongst them, don't believe it's even possible.)

Quite simply: LightSquared screwed itself. Either LightSquared did not employ competent engineers, who could have told them their plan was a non-starter from the get-go; or they ignored said competent engineers, or they assumed they could get away with screwing GPS users--including the aviation and shipping industries, and the United States military.

Even if the FCC had granted the waiver, I guarantee you the United States military would've put the kibosh on it.

KrK
Heavy Artillery For The Little Guy
Premium
join:2000-01-17
Tulsa, OK

Actually...

It's an egregious example of a company just trying to buy off the Government and use political capital to get what they want, and being so blatant and transparent about it, all the while snubbing other powerful players who have a lot of Government influence, so that the political tide turned against them.

They didn't have the rug yanked out from under them. They just attempted to steamroll their rug down on everyone else.
--
"Fascism should more properly be called corporatism because it is the merger of state and corporate power." -- Benito Mussolini

JasonOD

@comcast.net

Re: Actually...

said by KrK:

It's an egregious example of a company just trying to buy off the Government and use political capital to get what they want....

They didn't have the rug yanked out from under them. They just attempted to steamroll their rug down on everyone else.

Not entirely. LSQ'ds plans to wholesale LTE put both AT&T & Verizon against them, and they made their presence felt. Not saying the end result would be different, but LSQ had a lot of opposition. Especially since they had the audacity to start signing up wholesale partners before the licence was granted.

KrK
Heavy Artillery For The Little Guy
Premium
join:2000-01-17
Tulsa, OK

Re: Actually...



"all the while snubbing other powerful players who have a lot of Government influence"...

Exactly.

Oh_No
Trogglus normalus

join:2011-05-21
Chicago, IL
said by JasonOD :

said by KrK:

It's an egregious example of a company just trying to buy off the Government and use political capital to get what they want....

They didn't have the rug yanked out from under them. They just attempted to steamroll their rug down on everyone else.

Not entirely. LSQ'ds plans to wholesale LTE put both AT&T & Verizon against them, and they made their presence felt. Not saying the end result would be different, but LSQ had a lot of opposition. Especially since they had the audacity to start signing up wholesale partners before the licence was granted.

Their partners were not really partners.
They found like 15 small no-name local level companies that were willing to sign an agreement saying they would buy from lightsquare if their network was built. Their "partner" deal did not guarantee lightsquared any money.
There partner agreements were all symbolic.

The only real agreement they made was to pay sprint money to use sprint's network.

asdfdfdfdfdf

@myvzw.com

I don't like the ruling or the way this turned out...

but it is rather absurd for lightsquared to make it sound like the government pushed them into investing a lot of money and then ripped the rug out from under them.
I don't think this was decided simply upon supposed technical merits but also included a political angle, as these things always do. I think it is unfortunate that lightsquared was bested in the political wrangling but I don't think the government misled lightsquared or treated lightsquared dishonestly and I think it is time for lightsquared and the investors to suck it up and accept that it didn't work out.

Oh_No
Trogglus normalus

join:2011-05-21
Chicago, IL

Backed Away?

The waiver was conditional and the conditions were not met by Lightsquared.
So is lightsquared going to sue themselves???
HIPAR

join:2005-11-10
Tannersville, PA

Recovery of outlays

I don't believe they can sue to win an operating license. That was continent upon not disrupting GPS operations. The court will defer to FCC 'expertise' and its authority in licensing matters.

If Lightsquared can establish an agreement with the government that implied a fast track license was to be granted if they spent their own money to accelerate the network buildout maybe they can sue to recover their financial outlay. That seems to be the case.

DavePR

join:2008-06-04
Canyon Country, CA

The FCC didn't tell them to spend any more money

than the cost of the interference studies. If Lightsquared started stockpiling hardware and leasing tower space that's not the FCC's fault.

alphapointe
Don't Touch Me
Premium,MVM
join:2002-02-10
Columbia, MO
kudos:2
Reviews:
·Socket Internet ..

Boat's sinkin'...

»www.youtube.com/watch?v=pj-1b1Yvep8
gunther_01
Premium
join:2004-03-29
Saybrook, IL

FCC/Whitehouse Farse

LS screwed up. Period. There bad. Move on. You can't sit there and even try to make a network like that knowing a things about radio waves, and think it would work in the first place. The whole things was stupid.... To some degree the FCC is to blame for even allowing it to get off the ground. It WASNT going to work from the get go.
--
»www.wirelessdatanet.net
moonpuppy

join:2000-08-21
Glen Burnie, MD

Re: FCC/Whitehouse Farse

said by gunther_01:

To some degree the FCC is to blame for even allowing it to get off the ground. It WASNT going to work from the get go.

I will take exception to this statement.

While I agree this was a failed experiment on the part of LS, I do believe that they should have been allowed to at least try. That's how we find out if things work.

The issue is that when it did not work, LS tried to pull the "poor us" card and blame everything on everyone else.

Again, for the benefit of all those who are crying about LS going down, they were issued a license for one type of service and then tried to change the rules. They failed and they are still crying.