NextWave settlement passes another hurdle

NextWave’s settlement on Tuesday passed another preliminary step toward being finalized. The U.S. Justice Department signed off on the deal, which would divide the $16 billion raised at the reauction of NextWave PCS licenses between the bankrupt carrier and the government.

Gaining the administration’s approval the settlement must now go before Congress for final approval. FCC Chairman Michael Powell asked Congress to pass the resolution quickly.

“This begins to bring to a close a long, torturous event,” Powell said. “I hope Congress turns to the matter promptly in order to put this matter behind us and to ensure a resolution maximizes the public interest.”

NextWave received the F-block and C-block licenses at auction in 1996 for $4.7 billion but only paid $500 million of its bill before declaring bankruptcy. Since then, the FCC and NextWave have been in a legal battle over the licenses with the carrier claiming they are assets protected by Chapter 11 bankruptcy.

After a federal court ruling in its favor, the FCC reauctioned the licenses in January only to see the court’s decision overturned in appeal. The settlement gives almost $6 billion of the auction proceeds to NextWave and the remaining $10 billion to the U.S. government.

--Kevin Fitchard, staff writer