NextWave bankruptcy plan approved

NextWave Telecom announced Tuesday that its reorganization plan has received the approval of a U.S. bankruptcy court, paving the way for the company to finally launch its broadband wireless network.

U.S. Bankruptcy Court Judge Adlai S. Hardin greenlighted the Chapter 11 plan, originally filed by NextWave on June 8, 1998. "We are pleased that the years of effort have resulted in a plan that pays creditors in full and provides for significant distributions to equity holders," NextWave Chairman and CEO Allen Salmasi said in a prepared statement. "I am grateful to the constituents of the NextWave estates and to the bankruptcy court for their patience and tremendous support in helping us achieve these results."

NextWave filed for bankruptcy protection when it was unable to make payment on the $4.6 billion due for more than 200 spectrum licenses it won at FCC auction in 1996. In response, the FCC revoked NextWave's spectrum rights and re-auctioned the licenses; NextWave sued, claiming U.S. bankruptcy laws guaranteed protection from the FCC license revocation. The dispute ultimately reached the Supreme Court, which ruled that the FCC had improperly seized NextWave's spectrum and forced the commission to refund the roughly $16 billion it earned by reselling the licenses in question.

Although NextWave later sold many of its licenses--most notably earning $3.93 billion from deals with Verizon Wireless and $1.4 billion from a sale to Cingular Wireless--the company said it plans to launch broadband wireless operations in Las Vegas and New York City.