The SEC sent Harbinger Capital Partners a notice saying the agency is considering taking enforcement action against three executives including CEO Phil Falcone for securities violations, the hedge fund said in an SEC filing Friday. Harbinger is LightSquared’s largest investor. A LightSquared spokesman said “the SEC matter in no way involves LightSquared or Harbinger’s investment in the company.” Harbinger didn’t comment. The notice “is an indication of the current views of the staff of the Division of Enforcement, prior to a decision by the Commission. It does not constitute a determination that the recipients have violated any law,” said Harbinger in the filing. It said the notice is related to “violations of the federal securities laws’ anti-fraud provisions in connection with matters previously disclosed and an additional matter regarding the circumstances and disclosure related to agreements with certain fund investors.” Sen. Chuck Grassley, R-Iowa, used the notice to push the FCC to release long-requested communications between that agency, the White House and LightSquared. “Today, documents have been released showing that Mr. Falcone and his hedge fund, Harbinger Capital, received a Wells Notice from the SEC,” Grassley said. “While this does not mean the SEC definitely will take action against Mr. Falcone and his hedge fund, it does show that the SEC staff believes there is sufficient evidence to consider recommending an enforcement action. Now the FCC is faced with the real possibility that it made a multi-billion-dollar grant of valuable spectrum to someone who could be charged with violating securities laws. I raised this concern seven months ago. Chairman Genachowski was dismissive. Now, more than ever, the FCC chairman should lead the effort to provide documents and offer insight into how the agency decided to give Mr. Falcone, Harbinger Capital and LightSquared this multi-billion-dollar grant.” Bloomberg reported Friday that the National Space-Based Positioning, Navigation, and Timing Systems Engineering Forum draft of testing analysis says a major percentage of retested devices show interference issues with LightSquared’s proposed service. The NTIA and FCC said this year some retesting of general navigation devices would be necessary. Some 75 percent of the devices tested were susceptible to interference due to LightSquared’s terrestrial network, said Bloomberg. LightSquared and NTIA didn’t comment.
*Dec. 12 Google Chair Eric Schmidt speaks at Economic Club of Washington, Ritz-Carlton Hotel -- 202-481-3260
House Republicans as expected included the draft spectrum bill by Communications Subcommittee Chairman Greg Walden, R-Ore., in spending legislation to extend the payroll tax cut and other items. The House GOP unveiled the text of the “extenders” bill Friday morning (http://xrl.us/bmkks2). The chamber is likely to vote on the package this week, the House Rules Committee said. The extenders bill is unlikely to survive in its current form, but could foreshadow a final deal that includes spectrum, said telecom lobbyists and analysts. Also Friday, Sen. John McCain, R-Ariz., condemned House proposals to provide $3 billion for broadcaster relocation and to force public safety to return narrowband spectrum.
It will be “more of the same” for the FCC in 2012, Chief of Staff Eddie Lazarus told the Practising Law Institute conference Friday. The FCC still has significant work left expanding broadband adoption and addressing the country’s spectrum deficiencies, he said. Privacy experts on a separate panel said they expect the FTC and FCC to increase their focus on online privacy and cybersecurity issues in the coming year.
Spectrum and cybersecurity are top priorities for Democrats and Republicans on the House and Senate Commerce committees, committee aides said Thursday. On a panel at the Practising Law Institute conference, the aides said the House and Senate are close to consensus on a spectrum bill and agree on several areas related to cybersecurity. FCC process reform action will likely continue in the House, but Senate Democrats remain uninterested, the aides said.
Companies and industry groups continued to push for some changes to a draft order implementing a law restricting the noise levels of TV ads, ex parte notices show. The discussions came just before the FCC scheduled a vote on a report and order implementing the CALM Act at its Dec. 13 open meeting. Broadcast, cable, phone and TV programming executives met with FCC staff early this week to discuss possible changes to the order, which is reported to already give industry groups some of what they want (CD Dec 5 p9).
Competitive telcos think the FCC has turned its back on them, CLEC executives and lawyers told us. “I think the commission hasn’t taken any initiatives to promote competition,” said Eckert, Seamans telecom lawyer James Falvey. “There have been a number of issues that the CLECs have brought to the commission and said, ‘We need your help on this to promote competition.’ The commission hasn’t taken any proactive steps.”
Dec. 5 Media Access Project forum on new technologies, 8 a.m., Pew Conference Center, 901 E St. NW, Washington -- mera@mediaaccess.org
A spectrum venture of three cable companies agreed to sell 122 AWS licenses to Verizon Wireless for $3.6 billion, the companies said Friday. SpectrumCo is a joint venture of Comcast, Time Warner Cable and Bright House Networks, and the licenses cover 259 million POPs. The consortium was the third-highest bidder in the AWS-1 auction, which ended in September 2006, behind only T-Mobile and Verizon. The deal likely faces pushback similar to that aimed at AT&T for its proposed buy of 700 MHz spectrum from Qualcomm, a smaller deal now stalled at the commission. (See story in this issue.)
Spectrum legislation survived a lengthy House Communications Subcommittee markup in which the political parties squabbled over many details of the complicated bill. The subcommittee voted 17-6 to approve the GOP draft bill with amendments. Every Democrat voted no except Rep. John Barrow, D-Ga. The approved version would authorize voluntary incentive auctions and give public safety the 700 MHz D-block and $6.5 billion for a national wireless broadband network. The draft would not let the FCC provide for unlicensed use spectrum freed up by incentive auctions. States and a private company would play a large role in governance of the public safety network. And the bill would limit FCC authority to make rules in auctions.