NEWS ANALYSIS: Billionaire investor Philip Falcone has hired high-profile Washington, D.C., lawyers in a last-gasp effort to build LightSquared's network. The question is whether they will try to overturn the FCC's ruling.
In a legal Hail Mary that seems unlikely to produce
positive results, Philip Falcone, the billionaire investor behind the
LightSquared broadband data service, has hired two of Washington's highest
profile lawyers to try to overturn the Federal Communications Commission's decision
not to let the company operate its network.
The FCC withdrew approval after a series of tests by the
National Telecommunications and Information Administration (NTIA) and the
military showed conclusively that the LightSquared data network would
effectively kill GPS use in the United States.
Meanwhile, LightSquared continues to suffer losses of all
types. Sprint Nextel has now withdrawn its agreement to provide tower space for
LightSquared's transmitters and antennas, which leaves the company without
physical infrastructure. Leap Wireless, the company that sells the Cricket
brand of wireless phones and devices, has now dropped LightSquared and signed on with Clearwire for Long-Term Evolution (LTE)
services. Clearwire is majority-owned by Sprint Nextel.
The lawyers representing LightSquared include Ted Olson,
who represented President George W. Bush before the U.S. Supreme Court in the
disputed election case, Bush v. Gore. Also representing the company is Eugene
Scalia, son of U.S. Supreme Court Justice Antonin Scalia. Scalia has a long
history of successfully fighting regulatory decisions by the federal
government. Both lawyers are members of the firm Gibson Dunn & Crutcher in
While LightSquared has hired the new lawyers, the company
has not said what its plans are for these attorneys.
Both men are skilled litigators in a long list of federal
court cases in which various agencies have been sued by private companies.
However, LightSquared has other options as well. It could, for example, attempt
to recover its losses from moving ahead, assuming the FCC would give approval
to operate since approval had been given. The company could also attempt to
negotiate a spectrum swap that would allow it to move forward with its planned
LTE network on a frequency that wouldn't interfere with GPS.
Wayne Rash is a Senior Analyst for eWEEK Labs and runs the magazine's Washington Bureau. Prior to joining eWEEK as a Senior Writer on wireless technology, he was a Senior Contributing Editor and previously a Senior Analyst in the InfoWorld Test Center. He was also a reviewer for Federal Computer Week and Information Security Magazine. Previously, he ran the reviews and events departments at CMP's InternetWeek.
He is a retired naval officer, a former principal at American Management Systems and a long-time columnist for Byte Magazine. He is a regular contributor to Plane & Pilot Magazine and The Washington Post.