Case Information
*1 In the United States Court of Federal Claims No. 16-1C
(Filed: September 14, 2016)
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) Claimed breach of agreements with the FCC ALPINE PCS, INC., ) related to spectrum licenses purchased at
) auction by plaintiff; displacement of Plaintiff, ) jurisdiction founded on the Tucker Act by ) the remedial scheme provided by federal v. ) communication laws; application of United ) States v. Bormes ; takings claim precluded by UNITED STATES, ) the pertinent statute of limitations, 28 U.S.C.
) § 2501
Defendant. )
)
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Norman A. Pattis, New Haven, CT, for plaintiff.
Petеr A. Gwynne, Trial Attorney, Commercial Litigation Branch, Civil Division, United States Department of Justice, Washington, D.C., for defendant. With him on the briefs were Benjamin C. Mizer, Principal Deputy Assistant Attorney General, and Robert E. Kirschman, Director, and Steven J. Gillingham, Assistant Director, Commercial Litigation Branch, Civil Division, United States Department of Justice, Washington, D.C.
OPINION AND ORDER
LETTOW, Judge.
Plaintiff Alpine PCS seeks damages against the United States for breach of contract, breach of the duty of good faith and fair dealing, fraud in the inducement, and taking of property without just compensation. Plaintiff’s claims stem from cancellation by the Federal Communications Commission (“FCC” or “Commission”) of two Personal Communications Service (“PCS”) spectrum liсenses purchased by Alpine in an auction held in 1996. Compl. ¶ 1. Alpine held these licenses attendant to promissory notes and security agreements that permitted it to pay the FCC in installments. Alpine defaulted on its obligations to pay in 2002, and the FCC denied its requests for debt restructuring and waiver of payment in 2007. The licenses were resold in 2008.
*2 Alpine filed this suit оn January 4, 2016. Pending before the court is the government’s motion to dismiss for lack of subject matter jurisdiction under Rule 12(b)(1) of the Rules of the Court of Federal Claims (“RCFC”), ECF No. 8. A hearing was held on August 22, 2016.
BACKGROUND
A. Alpine’s Purchase of Spectrum Licenses and Its Default
Alpine PCS was in the business of providing wireless telecommunications services.
Compl. ¶ 3. In May 1996, Alpine was the winning bidder in an FCC auction for two ten-year
wireless spectrum licenses in the San Luis Obispo and Santa Barbara, California markets.
See In
re Alpine PCS
, 22 FCC Rcd. 1492, 1494-95,
In September 1996, Alpine and the FCC entered into an installment payment plan for Alpine to pay its winning bid amounts for the licenses in quarterly installments. Compl. ¶¶ 5-6. Contractually, the payment plan was memorialized in two installment payment plan notes and security agreements, under which the FCC was a secured creditor. Compl. ¶¶ 6, 8. Under the promissory notes, Alpine would be deemed in default of its obligations if it was delinquent in its payments to the FCC for more than 90 days and either failed to apply for a grace period or applied for such grace period and failed to resume payments after its expiration. Compl. App. 1 (Installment Payment Plan Note), at 2-3. A grace period would only be available if “provided for in the then-applicable orders and regulations of the Commission.” Id.
In January 2002, Alpine failed to make the requisite installment payments owed to the
FCC on its licenses. Compl. ¶¶ 22-23;
see In re Alpine PCS
, No. 08-00543,
The grace periods on Alpine’s notes expired on July 31, 2002.
In re Alpine PCS
, 2008
WL 5076983, at *2. A week before the expiration, on July 24, 2002, Alpine submitted a Request
for Debt Restructuring to the FCC. Compl. ¶ 28. On July 31, 2002, Alpine coupled this request
with a further request to the FCC for waiver of the deferred installment payment due on that date.
Compl. ¶ 30. Alpine made no payments before the expiration of the grace period, and the
licenses were automatically cancelled on August 1, 2002.
In re Alpine PCS
,
B. Prior Administrative and Judicial Proceedings
On January 29, 2007, the Chief of the FCC’s Wireless Telecommunications Bureau
denied Alpine’s requests for debt restructuring and waiver. , 22 FCC Rcd.
1492,
In April 2008, the FCC announced a new auction for the spectrum licenses previously
held by Alpine. Compl. ¶ 41. Alpine filed requests with the FCC and the Bankruptcy Court for
the District of Columbia to stay the auction pending review of the 2007 decision, but both were
denied.
In re Alpine PCS
, 23 FCC Rcd. 10485,
On January 5, 2010, the FCC denied Alpine’s request for reversal of the 2007 staff-level
decision. , 25 FCC Rcd. 469,
STANDARDS FOR DECISION
Defendant’s motion to dismiss Alpine’s complaint constitutes a factual attack on this
court’s jurisdiction under RCFC 12(b)(1). “[W]hen a court reviews a cоmplaint under a factual
attack, the allegations have no presumptive truthfulness, and the court . . . has discretion to allow
affidavits, documents, and even a limited evidentiary hearing to resolve disputed jurisdictional
facts.” 2 James Wm. Moore,
Moore’s Federal Practice
§ 12.30[4], at 12-45 (3d ed. 2012);
see
Land v. Dollar
,
ANALYSIS
A. This Court Lacks Jurisdiction over Alpine’s Claims for Breach of Contract and Breach of Duty of Good Faith and Fair Dealing Because the Federal Communications Laws and Associated Regulations Provide a Specific Remеdial Scheme for Such Claims
The Tucker Act, 28 U.S.C. § 1491(a), grants this court jurisdiction over disputes arising under contracts with the federal government. In pertinent part, the Tucker Act provides that “[t]he United States Court of Federal Claims shall have jurisdiction to render judgment upon any claim against the United States founded . . . upon any express or implied cоntract with the United States.” 28 U.S.C. § 1491(a)(1). The government acknowledges that the Tucker Act is pertinent, but it contests jurisdiction of the court on the ground that Alpine’s breach of contract claims are barred by the statute of limitations.
“Every claim of which the United States Court of Federal Claims has jurisdiction shall be
barred unless the petition thereon is filеd within six years after such claim first accrues.” 28
U.S.C. § 2501. This time limit is strictly construed and is jurisdictional.
See John R. Sand &
Gravel Co. v. United States
,
Even so, a different, critical jurisdictional hurdle arises respecting Alpine’s suit. “[T]he
Tucker Act is displaced . . . when a law assertedly imposing monetary liability on the United
States contains its own judicial remedies.”
United States v. Bormes
, __ U.S. __, __, 133 S. Ct.
12, 18 (2012). In essence, the gеneral avenue for relief provided by the Tucker Act is not
available when the applicable regulatory scheme provides a specific remedial framework.
Id.
at
18-19;
see also Folden v. United States
,
The federal communications lаws, along with associated regulations issued by the FCC,
provide a remedial scheme for administrative and judicial review of agency decisions related to
waiver of installment payments and cancellation of spectrum licenses. First, a party seeking
waiver of the Commission’s rules regarding spectrum licenses (here, automatic cancellation due
to nonpayment of a license installment plan) must petition the Chief of the Telecommunications
Bureau of the FCC. 47 C.F.R. § 1.925. An adverse decision must be appealed to the full
Commission before the party seeks judicial review. 47 C.F.R. § 1.115. If the full Commission
affirms the staff-level decision on appeal, only then can thе party seek judicial review. 47 U.S.C.
§ 402(b);
see Alpine PCS
,
In the case of a cancellation of a spectrum license for nonpayment, the FCC’s decisions
are exclusively appealable to the United States Court of Appeals for the District of Columbia
Circuit. 47 U.S.C. § 402(b)(5) provides that appeals of FCC decisions may be taken to the D.C.
Circuit “[b]y the holder of any . . . station license which has been modified or revoked by the
Commission.” The D.C. Circuit’s jurisdiction over claims that fall within this subsection is
exclusive.
Folden
,
Alpine’s claims fall within the purview of 47 U.S.C. § 402(b)(5). PCS spectrum licenses,
such as those held by Alpine, have been deemed to be “station licenses” within the context of the
communications laws.
Folden
,
B. Alpine’s Takings Claim is Barred by the Statute of Limitations in 28 U.S.C. § 2501
As a preliminary matter, this court will treat Alpine’s PCS spectrum licenses as prоperty
that could be subject to a taking. The FCC issues PCS spectrum licenses pursuant to 47 U.S.C. §
, which provides for the licensing and use of radio frequencies and other spectra.
[3]
The statute
*6
further states that “no such license shall be construed to create any right, beyond the terms,
conditions, and periods of the license.”
Id.
In its administrative decisions regarding PCS
spectrum licenses, the FCC has relied on
FCC v. Sanders Bros. Radio Station
,
Even so, “[t]he Communications Act itself seems to . . . impl[y] the creation of rights
akin to those created by a property interest limited only by the ‘terms, conditions and periods of
the license.’”
In re Atlantic Bus. and Cmty. Dev. Corp.
,
A takings claim will accrue for statute of limitations purposes when “governmental action
deprives the owner of all or most of its property interest.”
Northwest La. Fish & Game Pres.
Comm’n v. United States
,
Alpine asserts that it had no knowledge of the cancellation in 2002 because it “relied on
[the] FCC’s representation at that point in time that the Licenses had not been cancelled or
reverted to [the] FCC.” Compl. ¶ 35. Accrual of a claim against the United States is suspended
under the applicable statute of limitations, 28 U.S.C. § 2501, until the claimant knew or should
have known that the claim existed.
Martinez
,
Trials
, 28 F.C.C. Rcd. 758, 781 n.116,
court on January 4, 2016, it falls outside the six-year statute of limitations specified in Section 2501 and must be dismissed for lack of jurisdiction.
C. Alpine’s Fraud in the Inducement Claim is a Tort Claim Outside the Jurisdiction of the Tucker Act
The Tucker Act specifically excludes tort cases from the jurisdiction of the Court of
Federal Clаims. 28 U.S.C. § 1491(a)(1) (“The United States Court of Federal Claims shall have
jurisdiction to render judgment upon any claim against the United States . . . for liquidated or
unliquidated damages in cases not sounding in tort.”). Apart from its breach of contract and
takings claims, Alpine alleges that the FCC fraudulently induced the company to forfeit remedies
that would have allowed it to avoid cancellation of its spectrum licenses. Compl. ¶ 60. Fraud in
the inducement claims which do not arise from the violation of an existing contract are outside
this court’s jurisdiction.
Phang v. United States
,
CONCLUSION
For the reasons stated above, the government’s motion to dismiss plaintiff’s complaint pursuant to RCFC 12(b)(1) is GRANTED. The clerk will enter judgment in accord with this disposition.
No costs.
IT IS SO ORDERED.
s/ Charles F. Lettow Charles F. Lettow Judge
Notes
[1] “Persоnal Communications Service” denotes a form of wireless telecommunications service.
[2] The forum selection clause provided: Any legal action or proceeding relating to this Note, the Security Agreement, or other documents evidencing or securing the debt transaction evidenced hereby may only be brought in the Unitеd States District Court for the District of Columbia, and, by execution and delivery of this Note and Security Agreement, the maker hereby accepts for itself and in respect of its property generally and unconditionally, the jurisdiction of the aforesaid court. The parties hereto hereby irrevocably waive any objection, including, withоut limitation, any objection to the laying of venue or based on the grounds of forum non conveniens , which any of them may now or hereafter have to the bringing of any such action or proceeding in the District of Columbia. Compl. App. 1 (Installment Payment Plan Note), at 5 (capitals omitted).
[3] The FCC has construed the “channels for radio transmission” described in 47 U.S.C. § 301 to include PCS spectra. See, e.g., In re Reauction of Defaulted PCS C Block Licenses , 12