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FCC v. Nextwave Communications and Arctic Slope Corporation v. Nextwave Communications October 8, 2002 (01-653) return to case listing Case Summary This case concerns a conflict between the Bankruptcy Code and a federal agency, the Federal Communications Commission (FCC). The FCC has a statutory duty to ensure small business participation in auctions of broadband PCS licenses. In order to effectuate that duty, the FCC allowed winning bidders to pay for their licenses in installments. FCC took security interests in the licenses and would cancel the licenses if a bidder failed to make timely payments. When Respondents, winning bidders on several licenses, declared bankruptcy and stopped making payments, the FCC canceled their licenses. Section 525 of the Bankruptcy Code prohibits government entities from revoking debtors' licenses solely for failure to pay debts dischargeable in bankruptcy. The D.C. Circuit found that the FCC was bound by the rules governing the discharging of debts as explicated by the Bankruptcy Code and that Section 525 conflicts with and displaces the FCC's rules providing for cancellation of licenses upon nonpayment. The D.C. Circuit Court opinion can be found at 254 F.3d 130 To see the opinion of the lower court, click here. PREDICTED OUTCOME ACTUAL OUTCOME Forecasting Model Expert One Expert Two Expert Three 7-2 to Affirm 6-3 to Reverse 7-2 to Reverse 6-3 to Reverse 8-1 to Affirm VOTING TO REVERSE O'Connor Breyer Rehnquist O'Connor Kennedy Souter Ginsburg Breyer Rehnquist Stevens O'Connor Kennedy Souter Ginsburg Breyer Rehnquist O'Connor Kennedy Souter Ginsburg Breyer Breyer VOTING TO AFFIRM Rehnquist Stevens Scalia Kennedy Souter Thomas Ginsburg Stevens Scalia Thomas Scalia Thomas Stevens Scalia Thomas Rehnquist Stevens O'Connor Scalia Kennedy Souter Thomas Ginsburg return to case listing