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If you need the complete document, download the WordPerfect version or Adobe Acrobat version, if available. ***************************************************************** Before the Federal Communications Commission Washington, D.C. 20554 In re Applications of ) ) Louisiana RSA No. 8 Limited Partnership) File No. 00401-CL-P-97 ) For Authorization in the Domestic Cellular) Radio Telecommunications Service) on Frequency Block B ) in Market 461, Louisiana 8-St. James) ) BellSouth Mobility, Inc. ) File No. 00140-CL-P-462-B-97 ) For Authorization in the Domestic Cellular) Radio Telecommunications Service) on Frequency Block B ) in Market 462, Lousiana 9-Plaquemines ) ORDER Adopted: December 1, 1997 Released: December 2, 1997 By the Chief, Wireless Telecommunications Bureau: I. INTRODUCTION 1. In the order, we consider the Petitions to Deny filed by MobileTel, Inc. ("MobileTel") on March 17, 1997 against each of the above-captioned applications. MobileTel seeks dismissal of the applications on the grounds, (1) that the Commission is required to use competitive bidding to award the licenses and, (2) that the above-captioned applications lack critical technical information which renders them defective. As discussed below, we conclude that MobileTel's petitions should be denied and that the applications should be granted. II. BACKGROUND 2. In 1990, the Mobile Services Division of the Common Carrier Bureau ("MSD") awarded MobileTel, via lottery, the Block B cellular licenses for the Louisiana 8-St. James RSA ("Louisiana 8") and the Louisiana 9-Plaquemines RSA ("Louisiana 9"). BellSouth Mobility, Inc. ("BellSouth"), an applicant for both RSAs, and Columbia Cellular ("Columbia"), an applicant for Louisiana 8, sought reconsideration by the Commission of the license grants to MobileTel on the grounds that MobileTel was not a provider of local wireline telephone service in the two RSAs and was therefore ineligible for B Block cellular licenses under then-existing Section 22.902(b) of the Commission's rules. 3. On August 14, 1996, the Commission adopted the MobileTel order, which granted BellSouth and Columbia's petitions for reconsideration and rescinded MSD's prior grant of MobileTel's licenses. The Commission concluded that MobileTel's affiliation with a local provider of Basic Exchange Telecommunications Radio Service (BETRS) did not render it eligible for the Block B licenses, which were reserved for wireline carriers only. The Commission instructed the Wireless Telecommunications Bureau ("WTB") to award the Louisiana 8 and Louisiana 9 licenses expeditiously and in accordance with the cellular processing rules as they existed at the time of MSD's 1990 licensing decision. The Commission allowed MobileTel to continue operating under interim operating authority only until qualified applicants were licensed and ready to provide service. 4. Pursuant to the MobileTel order, on October 16, 1996, WTB issued a public notice requesting that the remaining applicants for the Louisiana 8 and Louisiana 9 markets resubmit their original applications and file amendments updating those applications. The sole remaining applicant for Louisiana 9 was BellSouth, while in Louisiana 8, the two remaining applicants were BellSouth and Columbia. On November 14, 1996, BellSouth and Columbia submitted a full market settlement for the Louisiana 8 RSA, and BellSouth amended its application to substitute an affiliated entity, the Louisiana RSA No. 8 Limited Partnership (Louisiana 8 LP) as the sole surviving applicant for the Louisiana 8 RSA. On November 16, 1996, BellSouth sought leave to file major amendments to its 1988 applications, reflecting the proposed addition of cell sites to extend the coverage of the systems described in its initial applications. 5. On February 14, 1997, WTB accepted Louisiana 8 LP's application for Louisiana 8 and BellSouth's application for Louisiana 9 (collectively "BellSouth applications") for filing. On March 17, 1997, MobileTel filed petitions to deny both applications. Initially, WTB determined that the BellSouth applications would be treated as Phase I Unserved Area applications. On March 31, 1997, BellSouth petitioned for reconsideration requesting that WTB treat its applications as initial cellular RSA applications and afford it all the privileges associated with such status. On April 2, 1997, WTB issued a public notice stating that the BellSouth applications would be treated as initial cellular RSA applications. 6. While the application process was pending, MobileTel appealed the Commission's MobileTel order to the United States Court of Appeals for the District of Columbia Circuit. The Court of Appeals upheld the MobileTel order on March 7, 1997. MobileTel's petition for certiorari of the Court of Appeals' decision was subsequently denied by the United States Supreme Court on November 3, 1997. On August 18, 1997, MobileTel filed a Petition for Special Relief with the Commission seeking reversal of the MobileTel order based on the Commission's subsequent Algreg decision. The petition has since been dismissed. 7. On November 12, 1997, MobileTel filed a letter with WTB contending that Section 3002(a)(2)(B) of the Balanced Budget Act of 1997 precludes the Commission from issuing any non-public broadcasting authorizations via random selection after July 1, 1997. In response, BellSouth argues that MobileTel's filing is unauthorized, untimely, and should be rejected. III. DISCUSSION 8. In its Petitions to Deny, MobileTel argues that as the interim operator in the Louisiana 8 and Louisiana 9 RSAs, it has standing to petition against BellSouth's applications. MobileTel further argues that the BellSouth Applications should be denied because: (1) the Commission should use competitive bidding to award the licenses, and (2) the BellSouth applications lack certain required technical information, which renders them defective. In response, BellSouth contends that MobileTel's interim operator status does not confer standing. BellSouth further argues that its applications are not subject to competitive bidding because they were pending prior to the establishment of the Commission's auction authority in 1993. BellSouth also argues that its applications conform to the Commission's technical requirements, and that the "defects" alleged by MobileTel relate to information that the Commission no longer requires of cellular applicants. 9. Standing. We first address the issue of whether MobileTel has standing to file petitions to deny against BellSouth's applications. Section 309(d)(1) of the Communications Act of 1934, as amended, bestows standing on any party in interest so long as that party pleads "specific allegations of fact sufficient to show that the petitioner is a party in interest . . ." Generally, to establish standing in licensing matters, the petitioner must allege sufficient facts to demonstrate that a grant of the subject application would cause the petitioner to suffer a direct injury. The petition must further demonstrate a causal link between the claimed injury and the challenged action by establishing that (1) the injury "fairly can be traced" to the challenged action, and (2) the injury would be prevented or redressed by the relief requested. 10. In its pleadings, MobileTel asserts standing on three grounds: (1) that grant of BellSouth's applications would cause MobileTel to be removed as interim operator in Louisiana 8 and Louisiana 9; (2) that it will be injured if BellSouth's applications are granted "prematurely" before it has exhausted its rights to appeal the MobileTel decision; and (3) that MobileTel has standing as the licensee in the neighboring Houma-Thibodaux, LA MSA, and that it will suffer harmful interference in that MSA if BellSouth's applications are granted. We conclude that MobileTel has failed to establish standing on any of these grounds. 11. MobileTel first argues that grant of BellSouth's applications will cause it to suffer "injury" for standing purposes because the license grants will terminate MobileTel's interim operating authority. The sole purpose of granting interim authority to MobileTel was to ensure continuity of service until a permanent licensee could be selected. Thus, MobileTel's interim operating rights are expressly intended to terminate and do not confer any potential permanent interest in the Louisiana RSAs. Moreover, MobileTel cannot assert standing based on the possibility of becoming the permanent licensee in these markets. This possibility has been foreclosed by the MobileTel decision, and MobileTel has exhausted its administrative and judicial appeal rights in that proceeding, the United States Supreme Court having recently denied certiorari in the case. 12. The Commission has previously held that interim operator status does not automatically grant standing to participate in the selection of a permanent licensee. In Global Broadcasting, the Commission found that an interim operator "has no legally cognizable interest affected by grant of a [minor] modification application filed by the permanent licensee", and therefore, lacks standing to file an application for review of the grant of the modification. Similarly, the mere fact that MobileTel will cease to operate as an interim operator if the BellSouth applications are granted is insufficient to establish injury here. Our conclusion that MobileTel lacks standing does not conflict with the La Star and Portland Cellular cases, which MobileTel cites as instances in which the Commission considered substantive arguments raised by interim operators in petitions to deny the applications of prospective permanent licensees. In fact, in contrast to Global Broadcasting, which was decided subsequently to La Star and Portland Cellular, neither of these cases even addresses standing. Therefore, we do not consider them binding on the issue here. 13. We also reject MobileTel's contention that "premature" granting of BellSouth's applications before MobileTel has exhausted its rights to appeal the MobileTel decision gives rise to an injury sufficient to confer standing. First, as noted above, MobileTel has in fact exhausted its appeal rights in the MobileTel proceeding, Moreover, MobileTel cannot establish that the relief it seeks on appeal -- restoration of its eligibility for the Louisiana licenses -- would be accomplished by denial of the licenses to BellSouth. In fact, because denial of the licenses would do nothing to change the Commission's decision with respect to MobileTel's eligibility, there is no causal relationship between the two. 14. Finally, we conclude that MobileTel has failed to allege sufficient facts to support its assertion of standing based on potential interference with its licensed operations in the Houma- Thibodaux, LA MSA. First, we note that the Houma-Thibodaux MSA abuts only one of the two Louisiana markets at issue. Second, MobileTel has failed to support its interference claims with specific facts supported by affidavits demonstrating that interference will result from grant of BellSouth's applications, as required by Section 309(d)(1) of the Act and Section 22.130(a)(3) of the Commission's rules. 15. While we conclude that MobileTel lacks standing, we nevertheless believe it is appropriate to consider the statutory and policy arguments raised in its petitions as part of our independent public interest analysis of BellSouth's applications under Section 309(a) of the Act. We therefore address these arguments below. 16. Competitive Bidding. MobileTel asserts that the licenses for the Louisiana 8 and Louisiana 9 markets should be awarded through competitive bidding. MobileTel argues that the initial grant of its applications by MSD in 1990, though subsequently rescinded by the Commission, resulted in the dismissal of BellSouth's competing applications. As a result, MobileTel contends, there were no "pending" applications for these markets when Congress conferred auction authority on the Commission in the Budget Act of 1993, and the statute therefore requires the Commission to award the licenses by auction. MobileTel further argues that even if the BellSouth applications are treated as having been pending since 1990, the Commission should subject the Louisiana RSAs to competitive bidding on policy grounds. MobileTel argues that these RSAs are significantly more valuable than they were in 1990 because of the expansion of CMRS and the growing demand for cellular service as a result of MobileTel's interim operations. MobileTel also contends that whether or not the BellSouth applications are treated as Unserved Area applications, the Commission should follow the precedent established in its Unserved Area rules of using auctions where an initial license awarded by lottery has been revoked. 17. We disagree with MobileTel's assertion that the licenses at issue must be awarded by competitive bidding, because MobileTel misreads the effect of the Commission's MobileTel decision. In MobileTel, the Commission vacated MSD's 1990 licensing order because it determined that MSD had incorrectly found MobileTel to be wireline-eligible to obtain the B Block licenses in Louisiana 8 and Louisiana 9. As MobileTel points out, the Commission subsequently eliminated the wireline eligibility requirements for Block B licenses in 1994. Thus, when it decided MobileTel, the Commission could have elected to apply current rules to make the Block B Louisiana licenses available to applicants other than local wireline carriers. Instead, however, the Commission specified that WTB was to license the Louisiana 8 and Louisiana 9 markets in accordance with the cellular rules in effect in 1990. Thus, in these two markets, the Commission dictated that the former wireline eligibility requirements would apply, so that initial RSA licenses would be awarded to an eligible wireline applicant. This holding is consistent with the Commission's original objective in adopting these requirements, which were designed to ensure that in the initial licensing of each cellular market, one of the two licenses would be "set aside" for a local wireline carrier. 18. Because the MobileTel order voided MSD's original licensing decision ab initio, it caused the applications of the remaining eligible wireline applicants for Louisiana 8 and Louisiana 9 to be returned to pending status. As a result, MobileTel's argument that we should use Unserved Area procedures and award the licenses by auction is baseless. First, as we have previously indicated, we interpret the MobileTel order to require licensing of Louisiana 8 and Louisiana 9 as initial RSA grants to eligible wireline carriers, not as unserved areas to be licensed to any party. Second, regardless of how we classify the applications, the Commission has authority to use auctions only where mutual exclusivity exists, i.e., where there are two or more competing applications for a market. In this instance, there is only one eligible wireline applicant for each market. Pursuant to BellSouth and Columbia's full market settlement for the Louisiana 8 RSA, the Louisiana RSA No. 8 Limited Partnership is the sole remaining applicant for the Louisiana 8 RSA. Similarly, BellSouth is the only remaining applicant for the Louisiana 9 RSA. In the absence of mutual exclusivity in either market, we have neither the need nor the authority to award the licenses by auction. 19. On November 12, 1997, MobileTel filed a letter with WTB contending that Section 3002(a)(2)(B) of the Balanced Budget Act of 1997 requires the Commission to award the Louisiana licenses by auction. We agree with BellSouth that MobileTel's filing is unauthorized and untimely under Section 1.45(c) of the Commission's rules, and we therefore do not consider it in this proceeding. In any event, our decision here is completely consistent with the Balanced Budget Act. In that legislation, Congress amended Section 309(i) of the Communications Act to revoke the Commission's authority to conduct lotteries for non-public broadcast licenses after July 1, 1997. This amendment would clearly preclude us from conducting a lottery in the event that mutually exclusive applications existed for these markets, even if the prior version of Section 309(i) would have allowed a lottery. However, nothing in the legislation prevents us from granting the non- mutually exclusive applications before us. 20. Technical Issues. MobileTel argues that BellSouth's applications are defective and should be dismissed because BellSouth did not submit engineering information required by FCC Form 401, but instead submitted FCC Form 600. Citing to former Section 22.15(a) of the Commission's rules, 47 C.F.R.  22.15(a), MobileTel argues that under the Commission's 1990 rules, cellular applications must provide all information needed to demonstrate compliance with the technical requirements of the rules. In a subsequent pleading, MobileTel acknowledges that Form 401 is no longer used but argues that the use of a new form should not excuse BellSouth's failure to provide all the information that was required by the Form 401. 21. We find that BellSouth's applications are in compliance with our rules and requirements. In 1994, we adopted FCC Form 600 to replace FCC Form 401. Our purpose in developing this form was to "simplify the application process, limit the information requested to relevant data, and facilitate electronic filing and automated information entry." Thus, Form 401 is no longer available to applicants. As such, BellSouth's submission of Form 600 complies with our application requirements. To require BellSouth to submit information that we no longer deem relevant from an obsolete form would not facilitate our public interest analysis of their applications. Therefore, we waive on our own motion all requirements of Form 401 that we eliminated when we adopted Form 600. 22. MobileTel also argues that we should not grant BellSouth's motion seeking leave to file a major amendment to extend the coverage of the system proposed in its initial applications. We disagree. When Bell South filed its initial applications in 1988, it proposed a two-cell system in Louisiana 8 and a one-cell system in Louisiana 9. During the seven years that MobileTel has operated the system under interim authority, however, it has expanded coverage well beyond the service area that was initially proposed by any applicant in 1988. In order to ensure continuity of service to all customers of MobileTel's system, BellSouth now proposes to establish four cell sites in Louisiana 8 and five in Louisiana 9. BellSouth contends that such a major expansion of its proposed CGSA is proper under Section 22.23(g)(6) of our 1990 cellular rules, which allowed applicants to file major amendments made necessary by unforeseeable circumstances. MobileTel contends that Section 22.23(g)(6) was not intended to accommodate the complete "transfiguration" of an applicant's proposed system. MobileTel also argues that the proposed amendment is unnecessary to ensure continuity of service, because customers beyond the coverage of BellSouth's original proposed system would be able to obtain service from Radiofone, the A Block licensee in the Louisiana markets. 23. We find it in the public interest to grant BellSouth's request to expand its proposed service area. We see no purpose in limiting BellSouth to the contours of the original system it proposed in 1988, when actual cellular coverage in the Louisiana markets has expanded dramatically during the intervening years. By allowing BellSouth to amend its applications, we ensure that it will be able to provide continuous service to customers who are currently served by MobileTel's system. We also believe that the circumstances presented here are sufficiently unique and unforeseeable to justify allowing a major amendment under former Section 22.23(g)(6). Plainly, BellSouth could not have foreseen in 1988 that it would not be commencing service for over nine years after it filed its initial applications, or that it would be replacing an interim operator that had expanded its coverage in the intervening period. We also reject MobileTel's argument that customers not served by BellSouth can migrate to the A Block carrier. We believe that customers throughout the Louisiana markets should have a choice between two competing cellular providers. Therefore, we grant BellSouth's motion for leave to amend its applications. IV. CONCLUSION 24. For the foregoing reasons, we deny MobileTel's petitions and grant the BellSouth applications for initial RSA authorizations. In granting BellSouth's applications, we further our goals of fostering the creation of a seamless and integrated nationwide cellular service, and making cellular service available to the public as expeditiously as possible. V. ORDERING CLAUSES 25. IT IS ORDERED pursuant to Sections 4(i) and 309(d) of the Communications Act of 1934, as amended, 47 U.S.C.  154(i) and 309(d) and Section 22.30(a)(3) of the Commission's rules, 47 C.F.R.  22.30(a)(3), that the petitions to deny or dismiss, filed by MobileTel Inc., on March 17, 1997, ARE DENIED. 26. IT IS FURTHER ORDERED pursuant to Sections 4(i) and 309(d) of the Communications Act of 1934, as amended, 47 U.S.C.  154(i) and 309(d) and Section 22.130(a)(3) of the Commission's rules, 47 C.F.R.  22.30(a)(3), that the applications filed by Louisiana RSA No. 8 Limited Partnership and BellSouth Mobility Inc., as amended on November 14, 1996, ARE GRANTED. 27. IT IS FURTHER ORDERED that the Motion for Leave to File A Major Amendment filed by BellSouth Mobility Inc., on November 15, 1996, IS GRANTED. 28. This action is taken pursuant to delegated authority under Section 0.331 of the Commission's rules, 47 C.F.R.  0.331. FEDERAL COMMUNICATIONS COMMISSION Daniel B. Phythyon Chief, Wireless Telecommunications Bureau