AtContact Motion to

MOTION submitted by ATCONTACT COMMUNICATIONS, LLC

Motion for Stay

2010-06-29

This document pretains to SAT-AMD-20080930-00194 for Amended Filing on a Satellite Space Stations filing.

IBFS_SATAMD2008093000194_826643

                                      Before the
                           Federal Communications Commission
                                 Washington, DC 20554



                                            )
In the Matter of                            )
                                            )
ATCONTACT Communications, LLC               )        File Nos. SAT-LOA-19971222-0022
                                            )        SAT-LOA-20040322-
                                            )        00234/35/36/37
                                            )
For Authority to Launch and Operate         )        Call Signs: S2346, S2680, S2681,
a Non-Geostationary Orbit Fixed-Satellite   )        S2682, S2683
System in the Ka-band Frequencies           )
                                            )




                           EXPEDITED ACTION REQUESTED

       To: The Commission

                                   MOTION FOR STAY

                                                Pantelis Michalopoulos
                                                Christopher R. Bjornson
                                                James Stuart
                                                STEPTOE & JOHNSON LLP
                                                1330 Connecticut Avenue, NW
                                                Washington, D.C. 20036
                                                (202) 429-3000

                                                Counsel for AtContact
                                                  Communications, LLC


                                                   TABLE OF CONTENTS
                                                                                                                               Page

I.     INTRODUCTION AND SUMMARY ................................................................................2

II.    JUSTIFICATION FOR GRANT OF STAY .......................................................................5

       A.        Likelihood of Success on the Merits........................................................................6

       B.        Irreparable Harm....................................................................................................13

       C.        Harm to Other Parties ............................................................................................17

       D.        Public Interest Factors............................................................................................18

III.   CONCLUSION..................................................................................................................19


                                       Before the
                            Federal Communications Commission
                                  Washington, DC 20554



                                                )
In the Matter of                                )
                                                )
ATCONTACT Communications, LLC                   )          File Nos. SAT-LOA-19971222-0022
                                                )          SAT-LOA-20040322-
                                                )          00234/35/36/37
                                                )
For Authority to Launch and Operate             )          Call Signs: S2346, S2680, S2681,
a Non-Geostationary Orbit Fixed-Satellite       )          S2682, S2683
System in the Ka-band Frequencies               )
                                                )



                            EXPEDITED ACTION REQUESTED

To: The Commission

                                    MOTION FOR STAY


I.     INTRODUCTION AND SUMMARY

       ATCONTACT Communications, LLC (“AtContact”), by its counsel, seeks a stay of: the

June 3, 2010 Commission Order1 denying AtContact’s Petition for Reconsideration of the

August 21, 2009 Bureau Order,2 thus nullifying AtContact’s satellite licenses for four

geostationary (“GSO”) satellites as well as a non-geostationary (“NGSO”) satellite system;3 or at



       1
       See ATCONTACT Communications, LLC, Order, FCC 10-100 (rel. June 3, 2010)
(“Commission Order”).
       2
        See ATCONTACT Communications, LLC, Order, DA 09-1850 (rel. Aug. 21, 2009)
(“Bureau Order”).
       3
        See contactMEO Communications, LLC, Order and Authorization, DA-06-864, 21 FCC
Rcd. 4035 (2006) (“Licensing Order”).
                                                    2


least of the bond forfeiture resulting from the license cancellation and associated demand that the

Commission has made on the surety.4 At Contact requests a stay during the pendency of the

appeal that it will file shortly with the Court of Appeals for the D.C. Circuit. Alternatively,

AtContact requests a short stay of 15 days while the Commission considers the request for a

longer stay.

       The ground for the cancellation of AtContact’s licenses was that AtContact failed to meet

the third “milestone” prescribed by the Commission towards building and operating its non-

geostationary system – commencement of physical construction of its first NGSO satellite.

Unless stayed, this action of the Commission, and particularly the forfeiture of the $3 million

bond posted to secure against noncompliance with that milestone, will have an immediate and

devastating result for AtContact. In that respect, by letter dated June 24, 2010, the

Commission’s Chief Financial Officer advised Safeco Insurance Company of America

(“Safeco”) of a Notice of Default and instructed Safeco to remit the sum of $3 million plus

interest to the United States Treasury.5 Therefore, AtContact respectfully requests action on this

motion on or before June 30, 2010, which would allow the timely filing of a stay request with the

Court of Appeals for the D.C. Circuit if the Commission were to deny all of the alternative

requests made herein.6

       All of the prerequisites to a stay are met: AtContact will likely succeed on the merits:

among other things, in denying relief from the bond forfeiture, the Commission overruled its



       4
        See Letter from Mark Stephens, Chief Financial Officer, FCC, to Safeco, at 1 (June 24,
2010) (“Notice of Default”).
       5
           Id.
       6
           See Fed. R. App. P. 18(a).
                                                     3


prior precedent giving another licensee the same relief based on evidence that, the Commission

recognized, was “generally the same” as that invoked here; the only distinction cited by the

Commission between the two cases is factually flawed. The Commission also canceled

AtContact’s license for both the NGSO and GSO systems, even though the milestone in question

pertained to construction of the NGSO system only, and even though the Commission had

decided to treat the two systems as separate. In explaining the inconsistency, the Commission

Order draws a distinction between processing purposes, where separate treatment was warranted,

and other purposes, where it was not, but cites no plausible or reasoned basis for such a

distinction. In response to AtContact’s argument, made in its petition for reconsideration, that

the Bureau was applying a new rule (at this stage, licensees must have paid at least 25% of the

satellite contract price), the Commission does not assert that the standard is not new, but only

that it is sensible, and does so based on a leap in logic – that since the start of any system

implementation cannot be enough to satisfy the milestone, it therefore makes sense to require

payment of at least 25% of the satellite contract’s price.

        AtContact will suffer irreparable injury – no less than the likely destruction of its

business – if the bond were to be forfeited. So will the public. Not only will consumers be

deprived of an innovative plan to provide satellite service to the frontier state of Alaska, in

furtherance of Congress’s and the Commission’s paramount goal of widening broadband

availability. Existing customers of AtContact’s service will not be able to upgrade to the large-

city-equivalent service that they yearn for, and may lose their current service. And the Treasury

will not suffer any injury from a granted stay, as its claim will continue to be secured by the

bond.



                                                      4


        Nor will any one else: AtContact’s proposed secondary use of the NGSO spectrum at

certain GSO orbital slots will not stand in anyone’s way, either during the stay or at all. Besides,

no one entity has filed an application to use the orbital and spectrum resources covered by

AtContact’s license, even though everyone has been able to file such an application since August

21, 2009.

        Indeed, after AtContact described substantially the same irreparable injury in its

September 21, 2009 request for a stay of the Bureau Order, the Commission stated in a letter

that “it would not act in further response to the Bond terms, or otherwise exercise any right

thereto without first providing Safeco a courtesy notification of our intent” and a period of 10

days to comply – a courtesy notification that the Commission did not send until it denied

AtContact’s petition for reconsideration.7 While that abeyance was not a formal stay, it seemed

to reflect a recognition of the irreparable injury to be suffered by AtContact.8

II.     JUSTIFICATION FOR GRANT OF STAY

        A stay is warranted if the movant can demonstrate that: (1) it is likely to prevail on the

merits; (2) it will suffer irreparable harm, absent a stay; (3) other interested parties will not be

harmed if the stay is granted; and (4) the public interest would favor a grant of the stay.9 As

outlined below, a careful review of each of these factors warrants the grant of this motion.




        7
        See Letter from Mark Stephens, Chief Financial Officer, FCC, to Safeco, at 2 (Oct. 1,
2010) (“Abeyance Letter”).
        8
          Id. The abeyance also announced that the Commission would defer “exercise[ing] any
right thereto” with regards to the Bond, which would seem to include the accrual of interest. See
id.
        9
        See, e.g. Va. Petroleum Jobbers Assoc. v. Fed. Power Comm’n, 259 F.2d 921, 925
(D.C. Cir. 1958) as modified by Wash. Metro Area Transit Comm’n v. Holiday Tours, Inc., 559
F.2d 841, 843 (D.C. Cir. 1977). These factors are not prerequisites that must be met, but
                                                   5


       A.      Likelihood of Success on the Merits

       AtContact meets handily the first prong of the stay standard. as the Commission decision

did not cure the Bureau’s errors, but instead compounded them with additional serious

infirmities. Among other things:

       First and foremost, the Commission improperly denied AtContact the relief from bond

forfeiture that it had given in Rainbow,10 and instead overruled that case. This makes Rainbow a

one-licensee rule, in violation of the tenet that similarly situated entities should be treated the

same,11 and marks a departure from precedent that does not appear to meet the Administrative

Procedures Act’s requirement of reasoned decisionmaking. Further, “agency action cannot stand

when it is so inconsistent with its precedents as to constitute arbitrary treatment amounting to an

abuse of discretion.”12




interrelated considerations that must be balanced together. See Mich. Coalition of Radioactive
Materials Users v. Griepentrog, 945 F.2d 150, 153 (6th Cir. 1991); In re DeLorean Motor Co.,
755 F.2d 1223, 1229 (6th Cir. 1985). In fact, under Commission precedent, a surplus of a
showing under one factor offsets a deficit under another. See Comark Cable Fund III, 104 FCC
2d 451, 456 ¶ 9 (1986); Dynamic Cablevision of Florida, Ltd., 10 FCC Rcd. 5156, 5156 ¶ 4
(1995).
       10
         Rainbow DBS Company, LLC, Memorandum Opinion and Order, 22 FCC Rcd. 4272
(2007) (“Rainbow”).
       11
           Garrett v. F.C.C., 513 F.2d 1056, 1060 (D.C. Cir. 1975) (An agency “cannot act
arbitrarily nor can it treat similar situations in dissimilar ways.”).
       12
           Id. (internal citations and quotations omitted). See also Melody Music, Inc. v. FCC,
345 F.2d 730, 733 (D.C. Cir. 1965) (concluding that the Commission's failure to explain its
decision simply and clearly merited reversal of its refusal to renew license, and on remand it was
to explain its reasons and do more than enumerate factual differences, between applicant’s case
and other cases; it would have to explain relevance of those differences as they relate to the
Federal Communications Act); Burlington N. & Santa Fe Ry. Co. v. Surface Transp. Bd., 403
F.3d 771, 777 (D.C. Cir. 2005) (“An agency must provide adequate explanation to justify
treating similarly situated parties differently. Where an agency applies different standards to
similarly situated entities and fails to support this disparate treatment with a reasoned
explanation and substantial evidence in the record, its action is arbitrary and capricious and
                                                        6


       Notably, the overruling of Rainbow seems connected to the Commission’s apparent

acknowledgment that distinguishing between these two cases is not easy: “True, AtContact

invokes generally the same type of evidence as was presented in the Rainbow case,” the

Commission recognizes.13 The only distinction the Commission Order mentions – that At

Contact’s spending represents “a small fraction of the large amount Rainbow expended”14 – is

itself factually infirm as it compares apples to oranges. Almost none of that large amount – just

over one percent – was expended by Rainbow on the licenses in question – the licenses secured

by the bonds – as opposed to Rainbow’s other licenses.15 What is more, the comparison ignores

all of the other circumstances at the two cases and the fact that, if anything, relief is more, not

less, warranted here. After all, Rainbow was exiting the business outright while AtContact was

and is still committed to make a go of it.16 And Rainbow actually never certified that it spent any

monies whatsoever on the construction of its licensed Ka-band satellites.

       Second, the Commission canceled AtContact’s authorizations for its GSO system based

on its claimed failure to commence construction of its first NGSO satellite, even though it had

explicitly decided to treat the two system authorizations (NGSO and GSO) as “separate.”17 In

defense of this inconsistency, the Commission Order compounds it when it explains that the



cannot be upheld.”) (citations omitted). Cf. James B. Beam Distilling Co. v. Georgia, 501 U.S.
529, 537 (“[S]elective prospectivity . . . breaches the principle that litigants in similar situations
should be treated the same, a fundamental component of stare decisis and the rule of law
generally.”).
       13
            Commission Order ¶ 49.
       14
            Id.
       15
            Rainbow ¶ 10.
       16
            Rainbow ¶ 4.
       17
            Commission Order ¶¶ 32-33.
                                                       7


separate treatment was only “for processing purposes.”18 The Commission Order does not cite,

however, any basis for distinguishing between processing and other purposes, and treating the

two systems as separate for the former but integrated for the latter category of purpose.

       Third, the Bureau improperly applied a new standard going beyond the scope of its

delegated authority,19 to determine if AtContact has commenced physical construction of its

NGSO system: “[b]ased on our experience in reviewing milestone compliance, at this point in

the construction process licensees have generally paid 25-50 percent of the total price in the

manufacturing contract due to the cost of procuring parts.”20 To that charge, the Commission

effectively responds by stating that the right standard for starting physical construction must be

more than “starting any system implementation.”21 That may indeed be the case, and the

Commission Order seems to take target at a strawman – AtContact never in fact argued that the

start of any system implementation is enough. But to say that the standard must be more than

starting any system implementation is not to prove that the standard is payment of at least 25%

of the contract’s price, nor does it prove that the standard was always set at this 25% minimum

payment.

       In fact, the standard always was what the Commission had said it was: not

commencement of any system implementation, not payment of at least 25% of the contract’s

price, but rather what seems to be a point in-between – commencement of physical




       18
            Id. ¶ 32.
       19
            47 C.F.R. § 0.261(a)(1).
       20
            Bureau Order ¶ 10.
       21
            Commission Order ¶ 25 (emphasis in original).
                                                     8


construction.22 The Commission is free to change and elevate that standard if it complies with

the requirement of a reasoned decisionmaking. But reasoned decisionmaking requires, at a bare

minimum, a recognition that the standard is in fact being changed, and careful consideration of

the retroactive aspects of such a change. Indeed, the Commission Order compounds the

impropriety by supplementing the Bureau’s new 25% construct with another yet new standard –

again without recognizing its novelty. As the Commission Order puts it: “licensees, like

AtContact, that have not made significant progress at this point in the implementation schedule

will have difficulty meeting the launch and operation milestone that occurs, in the case of NGSO

satellites such as AtContact’s, only one year later.”23 In other words, in evaluating whether a

licensee has met a milestone, the Commission can consider if it will have difficulty meeting the

next milestone. That is not the applicable rule – at least it was not prior to the date of the

AtContact decision. Nor is it a reasonable standard – matters relating to meeting a future

milestone are best evaluated at the time the licensee makes the showing that it has met that

milestone. Speculation as to the likelihood of meeting a future obligation would appear to be

palpably premature.

       Fourth, the Commission Order appears to misconstrue the relevance of the new evidence

submitted by AtContact, and to penalize AtContact for attempting to remedy the shortcomings in

its prior showing – shortcomings that the Bureau had purported to identify. The Commission



       22
          Amendment of the Commission’s Space Station Licensing Policies and Rules, IB
Docket No. 02-34, First Report and Order, FCC 03-102 ¶ 193 (“First-Come, First-Served
Order”) (“[W]e will require licensees to provide sufficient information to demonstrate to a
reasonable person that they have commenced physical construction of their licensed
spacecraft.”).
       23
            Commission Order ¶ 25.
                                                      9


reads each piece of evidence – the Declaration of the seller offering information in connection

with the asset sales agreement for the Travelling Tube Wave Amplifiers (“TWTA”s) and

confirming the authenticity and context of the photographs that AtContact had previously

submitted, the Declaration of the satellite contractor that the “TWTAs may be suitable for use in

the Ka NGSO 18.8-19.3 GHz downlink band range” and the cancelled checks submitted by

AtContact, in isolation, and finds it easy to conclude that each of them, standing alone, does not

“provide evidence that a licensee has met the beginning construction milestone.”24

       This is, as far as it goes, true. But this was not the purpose of these evidentiary

submissions. Their purpose was, rather, to supplement the showing that AtContact had made by

addressing directly and pointedly the precise shortcomings in that showing that the Bureau had

identified. Thus, the Bureau had stated that AtContact had not provided documentation linking

the asset sales agreement for the TWTAs to its manufacturing contract with Loral,25 and

AtContact submitted evidence of that link. The Bureau had criticized the lack of information on

the photographs’ provenance and context,26 and AtContact submitted evidence to elucidate these

facts. The Bureau had said that AtContact has not included cancelled checks or other evidence

of payments under the contract,27 and AtContact submitted that missing evidence, too. But the

Commission does not truly consider the extent to which the supplementary evidentiary

submissions responded to the Bureau’s criticisms and appears to assume that these criticisms




       24
            Id. ¶¶ 19, 21, 23.
       25
            Bureau Order ¶ 11.
       26
            Id. ¶ 14.
       27
            Id. ¶ 13.
                                                    10


were never leveled and that AtContact was offering each of these additional pieces of evidence

hoping that each is sufficient to withstand the weight of the entire showing.

       Fifth, the Commission does not respond to AtContact’s point that it stands in no one’s

way, except by stating in a conclusory fashion that AtContact’s continuing to hold its licenses

would be “to the exclusion” of others.28 But AtContact’s licenses have prevented no one from

utilizing the resources, and this is the unusual case where this fact need not be the matter of

speculation but instead is supported by tangible evidence. Since August 21, 2009, the release

date of the Bureau Order, any person was free to apply for the resources licensed to AtContact.29

But no one did, and to date no one has. In addition, AtContact is only licensed to use the

“NGSO” portion of the Ka-band. This band is almost entirely virgin and wide open. With two

degrees spacing, there are 30 slots between 71º W.L. and 129º W.L., of which the vast majority

remain fully available. Finally, AtContact’s GSO satellites are licensed only to make secondary

use of the spectrum. So, even assuming that a hypothetical additional user of the spectrum were

to transpire, AtContact would not stand in its way, but rather would be required to not cause any

interference to, and tolerate any interference from, such a user. The conclusion is hard to escape:

there is no clamor for use of that spectrum, and there is nobody to be held up if AtContact’s

license is not cancelled.

       Sixth, today, there is no more obvious and more urgent manifestation of the public

interest than the need for the Commission to ensure universal broadband availability throughout

the nation, and to encourage as wide actual broadband adoption as possible. Congress has said



       28
            Commission Order ¶ 36.
       29
            First-Come, First-Served Order ¶ 118.
                                                     11


so, and so has the Commission. But the Commission Order does not give sufficient weight to

that public interest. While the Commission Order acknowledges that “promoting broadband

services in rural areas is an important policy goal,”30 and notes that AtContact has applied for

stimulus funding under the American Recovery and Reinvestment Act of 2009, that could

facilitate his policy objective, it dismisses the potential for harm by discounting AtContact’s

potential contribution as a “mere possibility.”31 Of course, every forward-looking plan,

including every plan to provide service to Americans who do not now receive it, is by definition

a “mere possibility,” but that does not justify discounting it on that basis alone. As witnessed by

the Declaration of Mr. Drucker, its rural broadband stimulus application entirely depends on, or

would be dramatically enhanced by, use of one of AtContact’s licensed GSO orbital locations.32

The project would bring rich and fast Internet access service to the frontier states of Alaska and

Hawaii, placing inhabitants of these faraway lands on an almost level field with New Yorkers

and Los Angelenos.33 As AtContact has already pointed out, this is no mere quixotic dream –

AtContact has proved itself by starting to provide some Alaskans with the best satellite

broadband service available using existing resources. Today, AtContact serves more than 100

customers directly and thousands of end users, in Alaska and other rural areas. For example, Mr.

McPherson, whose Declaration was attached to AtContact’s Reconsideration Petition34 explains




       30
            Commission Order ¶ 36.
       31
            Id. ¶ 35.
       32
            Drucker Declaration ¶¶ 7, 10.
       33
            Id. ¶ 6.
       34
          The evidence submitted in support of that petition and its accompanying stay request is
also incorporated here by reference.
                                                   12


the harm he would suffer if AtContact were to be prevented from upgrading its service, is hardly

the only Alaskan resident who is in the same position.

       B.        Irreparable Harm

       On June 24, 2010, the Commission sent the surety instructions to the bond surety

requiring payment of $3,000,000 based on the finding that AtContact has failed to meet its third

milestone and invoking the bond forfeiture consequence that this finding entails. Absent a stay,

the payment will have to be made notwithstanding AtContact’s imminent appeal of the

Commission Order and possible vindication.35 At the very least, AtContact requests a stay of the

bond forfeiture appropriate pending resolution of the Court appeal AtContact will file (or at least

for 15 days as the Commission considers the request for a longer stay). The bond forfeiture

would cause immediate, permanent and devastating damage to AtContact and to its current

customers.

       To appreciate the scope and irreversibility of the harm, it is useful to survey AtContact’s

current services and its plans for the future, both of which are at mortal risk. As AtContact’s

founder David Drucker testifies, AtContact’s current communications services include teleport

and VSAT services, content distribution and high speed Internet connectivity throughout Alaska

and other underserved areas.36 AtContact provides these services by leasing transponder

capacity from established Fixed-Satellite Service systems such as Intelsat. AtContact now serves

about one hundred direct customers in Alaska and the Continental United States, providing last-




       35
           By AtContact’s calculation, the due date is July 6, 2010, the first business day that is
no later than 10 calendar days from the surety’s June 24, 2010 receipt of notice. See 47 C.F.R. §
1.4(j).
       36
            Drucker Declaration ¶¶ 5-6.
                                                    13


mile broadband to thousands of end users — many of its customers are institutional, and each of

them provides Internet access to dozens of local residents. AtContact also works closely with

remote communities to educate consumers about the cultural, instructional and other manifold

applications of broadband and to encourage their adoption (an issue nearly as important as

availability).37 Indeed, to the Northwest Arctic Borough in the far Northwest region of Alaska,

AtContact has recently added the Asa’carsarmiut Tribal Council, the Sauk-Suiattle Indian Tribe,

the Native Village of Eklutna, Doyon Ltd. (Alaska Native Corporation), Sea Lion Corporation

(Alaska Native Village Corporation), Quinalt Indian Nation, Gana-A’Yoo, Ltd. (Alaska Native

Village Corporation), Qivliq Commercial Companies (owned by NANA Development

Corporation, an Alaska Native Corporation), City of Galena, AK and Galena School Board,

American Indian Higher Education Consortium (AIHEC), Alaska Native Tribal Health

Consortium (ANTHC), Alaska State Library (ASL), National Urban Technology Center

(NUTC), Center for International Development, Rivada Sea Lion, LLC, Rivada Networks, LLC

(emergency responder telecommunications/public safety provider), Doyon, Limited (Native

Alaskan Corporation), the Quinault Indian Nation, and the Spokane Tribe of Indians among its

partners. This experience, these partnerships, and AtContact’s current services have laid the

groundwork to make affordable broadband services a reality for the unserved and the

underserved.38

       The service provided by AtContact today continues to be the best, or the only, broadband

alternative available to many of its customers. At the same time, that service suffers from



       37
            Id. ¶ 5.
       38
            Id.
                                                   14


inadequate and affordable bandwidth and is still sluggish compared to the data speeds that the

cable and phone companies offer in the big cities. AtContact's customers and many others in the

nation’s faraway areas, who do not have any service today, yearn for the faster, richer service

that Washingtonians and New Yorkers can enjoy. Moreover, many suburban and city

consumers, captive to the duopoly of cable and DSL today, would benefit significantly from a

low-cost, no-frills satellite alternative.39

        There is, of course, a reason why some of the country’s largest companies fall far short of

providing the country with universal broadband service, leaving large swaths of geography and

population unserved or underserved. The infrastructure is expensive, and private sector funding

for such high capital cost ventures is scarce to say the least. For that reason, the stimulus funds

allocated to promoting broadband deployment are, in Mr. Drucker’s words, nothing less than a

godsend, an essential element in the Government’s objective of realizing the vision of rural

broadband.40

        The missed opportunity is, if anything, even more concrete now, than it was on

September 21, 2009, when AtContact requested a stay of the Bureau Order. This is because the

stimulus agencies have since confirmed that satellite entities will be eligible for stimulus funds.

As part of the broadband funding contemplated by the American Recovery and Reinvestment

Act, the Rural Utilities Service (“RUS”) created a set-aside for satellite projects on January 15,

2010. As the RUS put it, “[g]iven the importance of efforts to reach unserved premises, a

separate Satellite Project category has been established to reach premises left unserved by other



        39
             Drucker Declaration ¶ 7.
        40
             Id.
                                                     15


technologies.”41 Within the category, one awardee is possible for each of eight U.S. regions –

Alaska being one such region. AtContact is well, and indeed uniquely, positioned, to provide the

kind of service envisioned by the RUS in Alaska. And tapping these funds is, by the same token,

essential to complete financing for AtContact’s system. AtContact is a party to a new

application filed with RUS and requesting funding for a broadband project using its licensed Ka-

band system. This application was specifically filed by a joint partnership between AtContact

and Native Broadband Satellite, LLC, which will use 121º W.L. orbital location to provide much

needed broadband service to Alaska and throughout the Western United States. In addition to

the requested federal funds, the Applicant has secured a private funding commitment of $80

million, contingent on receiving these funds. The application has received strong support from

many quarters, including Governor M. Michael Rounds of South Dakota, the Asa'carsarmiut

Tribal Council, Doyon, Limited (Native Alaskan Corporation), the Native Village of Eklutna, the

Quinault Indian Nation, the Sauk-Suiattle Indian Tribe, and the Spokane Tribe of Indians.

       Nullification of the satellite license and forfeiture of the associated performance bond

threatens both AtContact’s current business, the service AtContact provides today to Alaska,

and its plans to upgrade that service dramatically in the future, with total obliteration.42

AtContact initially borrowed five million dollars in order to post the performance bond, securing

that loan by its stock in WildBlue.43 AtContact has now paid down that loan by two million



       41
           Rural Utilities Service, Notice of Funds Availability, RIN: 0572-ZA01 (rel. Jan. 15,
2010). The RUS therefore dismissed satellite project applications filed in the first round,
including the ones in which AtContact participated, and invited applications in the set-aside
satellite round.
       42
            Drucker Declaration ¶ 10.
       43
            Id.
                                                      16


dollars. If the bond and, therefore, the security for the corresponding loan are forfeited, it is

highly doubtful that AtContact can continue to be in business and provide its current services.44

       Also, if the bond and associated security are forfeited now, and the Court eventually

agrees with AtContact that its licenses ought not to have been canceled, it would be too late. It

would no longer be possible to use the same security to raise additional funds to supplement

stimulus funds in order to proceed with construction of the system.

       By the same token, forfeiture of the bond and the loss of the associated security would

either prevent or significantly hamper the prospects of AtContact proceeding with the projects

for which it has requested federal funding and, in turn, the $80 million private funding

commitment contingent on that funding.45 Nullification of AtContact’s license also prevents it

from using its proposed satellite at 121ºW.L. to enhance its current services with a more robust,

higher quality, and more bandwidth-intensive, and hence faster, Internet service.46

       And all of that would severely curtail (if not take away) AtContact’s current ability to

provide broadband services to many unserved and underserved communities. This includes the

underserved Alaskans who rely on AtContact as their only broadband option.

       C.         Harm to Other Parties

       While denial of the stay would have nothing short of catastrophic consequences, grant of

the stay will conversely cause no harm to any other interested party. The United States Treasury

will face no risk whatsoever. Its claim will continue to be fully secured by the bond. Intelsat

was the only other party to the Bureau proceeding below and it will likewise not face any harm


       44
            Id. ¶ 11.
       45
            Id. ¶ 10.
       46
            Id.
                                                      17


by grant of the requested stay, let alone an irreparable injury. This is because, as mentioned

above, AtContact will not be in anyone’s way, either during the requested stay or at all. Its rights

to use the NGSO spectrum at its GSO slots are secondary, and therefore pose no hindrance to

any primary user of the spectrum at these slots. Its NGSO system can likewise share with other

NGSO spectrum users, and indeed has already been coordinated with Viasat’s proposed system.

Moreover, if all that is stayed is the bond forfeiture requirement, the Commission can proceed

with licensing the spectrum licensed to AtContact in the event someone files an application for it

– something that has yet to happen.

       D.      Public Interest Factors

       While no other interested party would be harmed by a grant of this requested stay, the

public could be harmed if it is not granted. Many of AtContact’s current customers rely on it as

their only source for broadband communications. They are in desperate need of more bandwidth

at a lower cost. And, if the stay is not granted, they will be harmed because a rejection of the

stay will make it more difficult for AtContact to move forward with its proposed enhancements

to its current services and it is doubtful that any comparable service will become available for

these communities in the foreseeable future from any other supplier.

       In the broader policy context, there is a related reason why Commission spectrum

policies militate against bond forfeiture. AtContact strongly believes that, despite an initial

delay, satellite use of that spectrum will emerge and provide a vigorous ingredient of the nation’s

broadband armature. But a bond forfeiture would send precisely the wrong signal to capital

markets from a spectrum policy standpoint: that the band, unused as it still largely is by satellite,

is somehow ripe for reallocation to uses other than satellite service by means of a rulemaking.



                                                     18


Such a result would be bad, and possibly disastrous, for the cause of universal broadband

availability.

III.    CONCLUSION


        Accordingly, AtContact requests that its Motion for Stay of the aforementioned Order

and Notice of Default (or at least the bond forfeiture) be granted pending AtContact's appeal of

the Commission Order, to the Court of Appeals for the District of Columbia Circuit, or at least

for 15 days until the Commission evaluates the request for a longer stay.



                                                     Respectfully submitted,



                                                     ____/s/________________________
                                                     Pantelis Michalopoulos
                                                     Christopher Bjornson
                                                     James Stuart
                                                     STEPTOE & JOHNSON LLP
                                                     1330 Connecticut Avenue, NW
                                                     Washington, D.C. 20036
                                                     (202) 429-3000

                                                     Counsel for AtContact
                                                     Communications, LLC


June 29, 2010




                                                   19


                                    CERTIFICATE OF SERVICE

       I, Christopher Bjornson, do hereby certify that on this 29th day of June, 2010, I sent by

hand delivery, electronic mail or facsimile, a copy of the foregoing Motion for Stay to the

following:

       Phillip L. Spector
       Executive Vice President,
       Business Development & General Counsel
       Intelsat
       3400 International Drive, NW
       Washington, D.C. 20008

       Safeco Insurance Company of America
       Safeco Plaza
       1001 4th Avenue
       Seattle, WA 98184


                                                     ___/s/___________________________
                                                     Christopher Bjornson


                           DECLARATION OF DAVID DRUCKER

1.       My name is David M. Drucker and I am the manager and founder of AtContact
Communications, LLC (“AtContact”). I have been deeply involved with many companies in the
satellite industry, including as a co-founder of EchoStar Satellite Corporation and the founder of
WildBlue Communications Corp. This declaration repeats, updates and supplements matters
included in the Declaration I executed on September 20, 2009, with an emphasis on the injury
AtContact would incur if its satellite authorizations were nullified and the performance band
associated with these authorizations were to be forfeited. To the extent certain statements from
my earlier Declaration are not repeated in this one, I incorporate them by reference and confirm
their continuing validity.

2.       The threatened injury to AtContact, our customers and the public is great and irreparable.
If the invalidation is left to stand and our bond forfeited, our business is faced with imminent
destruction and our Alaskan customers with loss of service. Such a course of events would also
strike a likely mortal blow for the application that AtContact has filed with the Rural Utilities
Service (“RUS”), requesting funds for essential rural broadband projects.

AtContact Is Real And Its Plans Will Further the Public Interest

3.       AtContact filed its initial FCC application in 1997 for the purpose of creating a satellite
network to provide ubiquitous high speed Internet throughout our service areas. The teleport
facility in Sedalia, Colorado was started in 1999 to further that project and provide immediate
services to meet the demand for high-speed data, audio and video communication, including
public safety services in remote and underserved areas of the United States, and with a particular
focus on Alaska and rural areas in the lower 48.

4.      AtContact’s current communications services include teleport and VSAT services,
content distribution and high speed internet connectivity throughout Alaska and other
underserved areas. AtContact provides these services by leasing transponder capacity from
established FSS systems such as Intelsat. AtContact now continues to serve about one hundred
direct customers in Alaska and the Continental United States, providing last-mile broadband to
thousands of end users. (Many of our customers are institutional, and each of them provides
Internet access to dozens of local residents.) We also work closely with remote communities to
educate consumers about the cultural, instructional and other manifold applications of broadband
and to encourage their adoption (an issue nearly as important as availability). We specifically
continue to work with the Northwest Arctic Borough in the far Northwest region of Alaska.
Since I offered my first Declaration in this proceeding, we have added the Asa’carsarmiut Tribal
Council, the Sauk-Suiattle Indian Tribe, the Native Village of Eklutna, Doyon Ltd. (Alaska
Native Corporation), Sea Lion Corporation (Alaska Native Village Corporation), Quinalt Indian
Nation, Gana-A’Yoo, Ltd. (Alaska Native Village Corporation), Qivliq Commercial Companies
(owned by NANA Development Corporation, an Alaska Native Corporation), City of Galena,
AK and Galena School Board, American Indian Higher Education Consortium (AIHEC), Alaska
Native Tribal Health Consortium (ANTHC), Alaska State Library (ASL), National Urban
Technology Center (NUTC), Center for International Development, Rivada Sea Lion, LLC,
Rivada Networks, LLC (emergency responder telecommunications/ public safety provider),


Doyon, Limited (Native Alaskan Corporation), Quinault Indian Nation, and the Spokane Tribe of
Indians as our partners. This experience, our partnerships, and our current services have laid the
groundwork to make affordable broadband services a reality for the unserved and the
underserved.

5.     The service provided by AtContact today is the best, or the only, broadband alternative
available to many of our customers. At the same time, that service suffers from inadequate and
affordable bandwidth and is still sluggish compared to the data speeds that the cable and phone
companies offer in the big cities. I know that our customers and many others in the nation’s
faraway areas, who do not have any service today, yearn for the faster, richer service that
Washingtonians and New Yorkers can enjoy. Moreover, I know that many suburban and city
consumers, captive to the duopoly of cable and DSL today, would benefit significantly from a
low-cost, no-frills satellite alternative.

6.       There is, of course, a reason why some of the country’s largest companies fall far short of
providing the country with universal broadband service, leaving large swaths of geography and
population unserved or underserved. The infrastructure is expensive, and private sector funding
for such high capital cost ventures is scarce to say the least. For that reason, the stimulus funds
allocated to promoting broadband deployment are nothing less than a godsend, an essential
element in the Government’s objective of realizing the vision of rural broadband. On January
15, 2010, RUS confirmed that stimulus funds will be available for satellite projects. In fact, RUS
created a set-aside for satellite projects. Thus, RUS rejected satellite applications that had been
filed in the first round, including the ones in which we had participated, and it invited
applications in the satellite set-aside category. Within the category, one awardee is possible for
each of eight U.S. regions – Alaska being one such region. AtContact is uniquely positioned to
provide the kind of service envisioned by the RUS and the NTIA in Alaska. Tapping these funds
is, by the same token, essential to complete financing for AtContact’s system.

7.      Pursuant to the Notice subsequently issued by RUS, AtContact is a party to a new
application requesting funding for certain aspects of a $230 million broadband project using its
licensed Ka-band system. This application, like the one in the first round, was filed by a joint
venture between AtContact and Native Broadband Satellite, LLC, which will use the 121º W.L.
orbital location to provide much needed broadband service to Alaska and throughout the Western
United States. In addition to the requested federal funds, the Applicant has secured a private
funding commitment of $80 million, contingent on receiving these funds. Moreover, the
Northwest Arctic Borough has endorsed our plan and declared itself ready to enter into an
agreement with AtContact to serve the Borough’s broadband needs. The application has
received strong support from many quarters, including Gov. M. Michael Rounds (South Dakota,
the Asa'carsarmiut Tribal Council, Doyon, Limited (Native Alaskan Corporation), the Native
Village of Eklutna, the Quinault Indian Nation, the Sauk-Suiattle Indian Tribe, and the Spokane
Tribe of Indians. As I will discuss in greater detail below, these projects would be struck,
perhaps mortally, by a Bureau invalidation of AtContact’s authorizations.

Potential Harm Due to Nullification of Licenses




                                                 2


8.     AtContact pursued and obtained its satellite authorization so it would be able to
affordably reach the unserved and underserved markets with high-quality broadband services. A
bond was not required when the initial filing was made some nine years before the grant.

9.      It is no surprise that the current economic crisis has caused the private financing
prospects for AtContact’s NGSO/GSO hybrid satellite system to deteriorate. We have
discovered the same harsh realities that led Congress to earmark federal stimulus funds for
broadband deployment: potential investors are currently withdrawing and choosing to withhold
capital investment, for any projects with large upfront costs whose commercial success and cost
recovery prospects are not already tested and demonstrated. Broadband satellites fall in that
category. We have persevered, however. As we have indicated to the Commission, the system
will likely have to be modified and streamlined. But we are very serious about deployment, and
as discussed, have turned to the stimulus funding opportunities to supplement the private funds
that may still be available.

10.      Nullification of the satellite license and forfeiture of the associated performance bond
threatens both AtContact’s current business, the service AtContact provides today to Alaska, and
our plans to upgrade that service dramatically in the future, with total obliteration. AtContact
initially borrowed five million dollars to post the performance bond, securing that loan by our
stock in WildBlue. We have now paid down that loan by two million dollars. If the bond and
the security for the corresponding loan are forfeited, it is highly doubtful that AtContact can
continue to be in business and provide its current services. Also, if the bond is forfeited now,
and the appropriate court eventually agrees with AtContact that its licenses ought not to have
been canceled, it would be too late. It would no longer be possible to use the same security to
raise additional funds to supplement stimulus funds in order to proceed with construction of the
system. By the same token, forfeiture of the bond would either prevent or significantly hamper
the prospects of AtContact proceeding with the projects for which it has requested federal
funding, the $80 million private funding commitment contingent on that funding, and the
availability of broadband services to the Northwest Arctic Borough and our other Alaskan
partners. Nullification of AtContact’s license also prevents it from using the satellite to enhance
its current services with a more robust, higher quality, and more bandwidth-intensive, and hence
faster, Internet service.

11.    And all of that would severely curtail (if not take away) AtContact’s current ability to
provide broadband services to many unserved and underserved communities. This includes the
underserved Alaskans who rely on AtContact as their only broadband option.




                                                 3


06—29—10;09:49AM; Sheraton Kauai      — Front Desk                               1808 742 9777   #   2/   2




          are under penalty of perjury that the foregoing is true and correct.



           Drucker
     Executed on June 29, 2010



Document Created: 2010-06-29 17:42:22
Document Modified: 2010-06-29 17:42:22

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