MEMORANDUM MEMORANDUM OPINION AND ORDER by the Commission SAT-ASG-20150406-00017 FCC-15-164A1 (003).p

Attachment FCC-15-164A1 (003).p

FCC-15-164A1 (003).p

MEMORANDUM OPINION AND ORDER submitted by the Commission

MEMORANDUM

2015-12-04

This document pretains to SAT-ASG-20150406-00017 for Assignment on a Satellite Space Stations filing.

IBFS_SATASG2015040600017_1117262

Federal Communications Commission FCC 15-164

Before the
Federal Communications Commission
Washington, D.C. 20554

In the Matter of )
)
Applications of LightSquared Subsidiary LLC, ) IB Docket No. 15-126
Debtor-in-Possession, and LightSquared Subsidiary )
LLC )
)
For Consent to Assign and Transfer Licenses and )
Other Authorizations and )
)
Request for Declaratory Ruling on Foreign )
Ownership )

MEMORANDUM OPINION AND ORDER AND DECLARATORY RULING

Adopted: December 3, 2015 Released: December 4, 2015

By the Commission: Commissioner Pai approving in part, concurring in part and issuing a statement;
Commissioner O’Rielly issuing a statement.

TABLE OF CONTENTS

Heading Paragraph #

I. INTRODUCTION .................................................................................................................................. 1
II. BACKGROUND .................................................................................................................................... 2
A. The Applicants ................................................................................................................................. 2
B. The Proposed Transaction................................................................................................................ 5
C. Application and Review Process...................................................................................................... 8
III. DISCUSSION......................................................................................................................................... 9
A. Framework ....................................................................................................................................... 9
B. Character Qualifications ................................................................................................................ 10
C. Foreign Ownership......................................................................................................................... 19
D. Competitive Analysis..................................................................................................................... 32
E. National Security, Law Enforcement, Foreign Policy, and Trade Policy ...................................... 34
IV. CONCLUSION .................................................................................................................................... 36
V. ORDERING CLAUSES....................................................................................................................... 37

I. INTRODUCTION
1. In this proceeding we approve, subject to conditions, the assignment of licenses and
international section 214 authorizations and the transfer of domestic section 214 authority from
LightSquared Subsidiary LLC, Debtor-in-Possession (“LightSquared Sub DIP”) to LightSquared
Subsidiary LLC (“LightSquared Sub”), pursuant to sections 310(d) and 214(a) of the Communications
Act of 1934, as amended (“Act”).1 We also issue a declaratory ruling to permit foreign ownership of

1
See 47 U.S.C. §§ 214, 310(d); Applications for Consent to Assign Licenses and Authorizations from LightSquared
Subsidiary LLC, Debtor-in-Possession, to Reorganized LightSquared Subsidiary, LLC (filed Apr. 6, 2015)
(“Application”). Page citations to the Application refer to the public interest statement submitted in the assignment
(continued….)

Federal Communications Commission FCC 15-164

LightSquared Sub’s controlling U.S. parent, New LightSquared, to exceed the 25% benchmark for
foreign ownership in section 310(b)(4) of the Act subject to specific terms and conditions.2 If
consummated, the proposed transaction will allow LightSquared entities to emerge from over three years
of bankruptcy proceedings and will result in relinquishment of control by Philip A. Falcone (“Falcone”),
through Harbinger Capital Partners Funds (“Harbinger”), of the Commission authorizations held by
LightSquared Sub DIP.3 Following consummation of the transaction, Harbinger, JPMorgan Chase & Co.
(“JPMorgan”), Fortress Investment Group LLC (“Fortress”), and Jeffrey Aronson (“Aronson”) and Mark
Gallogly (“Gallogly”), through Centerbridge Partners, L.P. (“Centerbridge”), will hold substantial
interests in New LightSquared, the parent of the reorganized LightSquared Sub. Grant of the Application
serves the public interest by enabling LightSquared entities to emerge from bankruptcy with access to
significant new capital, furthering the viability of their service offerings.
II. BACKGROUND
A. The Applicants
2. LightSquared Sub DIP provides L-band4 mobile-satellite service (“MSS”) throughout
North America using the U.S.-licensed SkyTerra-1 and MSAT-2 geostationary space stations and fixed
and mobile earth stations.5 An affiliated entity, One Dot Six DIP, is the lessee under a de facto transfer
leasing arrangement in connection with a nationwide license issued to OP LLC for terrestrial operations
in the 1670-1675 MHz frequency band.
3. LightSquared Sub DIP is a wholly owned direct subsidiary of LightSquared LP, Debtor-
in-Possession, which in turn is a wholly owned indirect subsidiary of LightSquared Inc., Debtor-in-
Possession.6 One Dot Six DIP is a wholly owned subsidiary of LightSquared Inc., Debtor-in-Possession.7
Falcone, through the private investment firm Harbinger, ultimately controls LightSquared Sub DIP and
One Dot Six DIP.8

(Continued from previous page)
applications filed under section 310(d) of the Act. See, e.g., IBFS File No. SAT-ASG-20150406-00017. We also
approve the assignment of authority for a de facto transfer lease from One Dot Six Corp., Debtor-in-Possession
(“One Dot Six DIP”), to One Dot Six LLC (“One Dot Six”). We refer to LightSquared Sub DIP, LightSquared Sub,
One Dot Six DIP, and One Dot Six collectively as the “Applicants.”
2
47 U.S.C. § 310(b)(4); LightSquared Subsidiary, LLC; Petition for Declaratory Ruling Under Section 310(b)(4) of
the Communications Act of 1934 (filed Apr. 6, 2015, and refiled May 22, 2015) (“Petition”). Page citations to the
Petition refer to the Petition for Declaratory Ruling filed May 22, 2015.
3
See SkyTerra Communications, Inc., Transferor, and Harbinger Capital Partners Funds, Transferee, Applications
for Consent to Transfer of Control of SkyTerra Subsidiary, LLC, IB Docket No. 08-184, Memorandum Opinion and
Order and Declaratory Ruling, 24 FCC Rcd 3059 (IB, OET, and WTB 2010) (“Harbinger Transfer Order”).
4
The “L band” is a general designation for frequencies from 1 to 2 GHz. In the United States, the Commission has
allocated L-band spectrum for mobile-satellite-service downlinks (space-to-Earth transmissions) in the 1525-1544
MHz and 1545-1559 MHz bands and for mobile-satellite-service uplinks (Earth-to-space transmissions) in the
1626.5-1645.5 MHz and 1646.5-1660.5 MHz bands. See 47 C.F.R. § 2.106.
5
LightSquared Sub DIP also provides MSS in the United States via the Canadian-licensed MSAT-1 space station,
and holds a conditional authorization to deploy an ancillary terrestrial component of its MSS satellite networks. In
addition to its satellite-service licenses, LightSquared Sub DIP also holds Commission authorizations for terrestrial
communications facilities, as well as domestic section 214 authority and international section 214 authorizations.
6
See Application at 3, Attach. B.
7
See id., Attach. B.
8
See Harbinger Transfer Order, 24 FCC Rcd 3059; Letter from Jeffrey J. Carlisle, Executive Vice President,
Regulatory Affairs and Public Policy, LightSquared GP Inc., to Marlene H. Dortch, Secretary, FCC, IBFS File No.
SES-T/C-20080822-01088 (filed July 20, 2010) (noting corporate name changes from SkyTerra to LightSquared).

2

Federal Communications Commission FCC 15-164

4. Following consummation of the transaction described below, the Commission
authorizations held by LightSquared Sub DIP and One Dot Six DIP will be assigned and transferred to
LightSquared Sub and One Dot Six,9 respectively, as the reorganized entities emerging from bankruptcy.
JPMorgan, Fortress, Aronson and Gallogly, through Centerbridge, and Harbinger, will each hold indirect
interests in LightSquared Sub and One Dot Six. JPMorgan is a widely traded, publicly held financial
services firm.10 Fortress is a publicly traded investment management firm.11 Centerbridge is a private
investment firm. Aronson and Gallogly each hold 50% of the voting interests in Centerbridge and
together control the company.12 The Applicants represent that none of JPMorgan, Fortress, Centerbridge,
or Harbinger holds a 10% or greater interest in any satellite or other wireless telecommunications
provider.13
B. The Proposed Transaction
5. The proposed reorganization is a result of the Chapter 11 bankruptcy proceeding of
LightSquared Sub DIP, One Dot Six DIP, and affiliated entities that began in May 2012.14 In March
2015, the bankruptcy court confirmed a plan of reorganization that would allow the LightSquared debtor
entities to emerge from bankruptcy under new ownership.15
6. Under the proposed transaction, LightSquared Sub DIP will be reorganized as
LightSquared Sub, and One Dot Six DIP will be reorganized as One Dot Six. Both LightSquared Sub and
One Dot Six will be wholly owned direct subsidiaries of the reconstituted LightSquared LP, “New
LightSquared,” a Delaware limited liability company.16 All of the common units and most of the equity
in New LightSquared will be held by JPMorgan, Fortress, Centerbridge, Harbinger, or their affiliates.17
7. JPMorgan will hold its interests through a wholly owned indirect subsidiary, described as
the “Reorganized LightSquared Inc.” (“RLI”).18 RLI will hold, indirectly,19 approximately 21.25% of the
9
Upon its emergence from bankruptcy, One Dot Six will be converted to a limited liability company. Letter from
Gerard J. Waldron, Counsel, LightSquared Subsidiary LLC, to Marlene H. Dortch, Secretary, FCC, IB Docket No.
15-126, at 5 (filed Sept. 9, 2015) (“September Supplement”).
10
Application at 8. See also September Supplement at 2.
11
Fortress has two classes of shares. Class A shares, representing approximately 48% of the Fortress interests, are
publicly traded. The vast majority of Class B shares, which represent the remaining 52% of the equity in Fortress,
are held by four U.S. citizens: Wesley Edens, Randal Nardone, Peter L. Briger, Jr., and Michael Novogratz. See
Application at 9; September Supplement at 2; Letter from Gerard J. Waldron, Counsel, LightSquared Subsidiary
LLC, to Marlene H. Dortch, Secretary, FCC, IB Docket No. 15-126, at 2 (filed Oct. 28, 2015) (“October
Supplement”).
12
See Letter from Gerard J. Waldron, Counsel, LightSquared Subsidiary LLC, to Marlene H. Dortch, Secretary,
FCC, IBFS File No. SAT-ASG-20150406-00017, at 3 (filed May 22, 2015) (“May Supplement”).
13
See Application at 16-17; May Supplement at 7.
14
See In re LightSquared Inc., et al., Case No. 12-12080 (Bankr. S.D.N.Y.); see also 11 U.S.C. §§ 101 et seq.
15
See Application at 3, Attach. D.
16
See id. at 4-5, May Supplement, Chart C-1.
17
See Application at 6, 8-12; May Supplement at 8; September Supplement, Attach. 3. These investors will own
equity in New LightSquared through both common and preferred unit holdings. The Applicants state that other
entities will own small amounts of preferred unit holdings in New LightSquared but that none of these entities will
hold a 10% or greater interest and all such interests will be insulated in accordance with section 1.993 of the rules.
See Petition at 7 n.12; see also id. at 21 n.35.
18
See Application at 8; September Supplement at 3. JPMorgan will hold its interest in RLI through a wholly owned
subsidiary, SIG Holdings, Inc. September Supplement at 3.
19
See September Supplement at 3.

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Federal Communications Commission FCC 15-164

New LightSquared Common Units,20 and will control the appointment of one member of the seven-
member New LightSquared governing board.21 Fortress ultimately controls LSQ Acquisition Co. LLC
(“LSQ”),22 which will hold approximately 26.2% of the New LightSquared Common Units23 and the right
to appoint two members of the New LightSquared Board.24 Aronson and Gallogly, through Centerbridge,
will control the right to appoint one member of the New LightSquared Board.25 Two other Board
members will be nominated and elected by a majority vote of these four Board members. The Chief
Executive Officer of New LightSquared will serve as the seventh Board member.26 Aronson and
Gallogly also ultimately control two Centerbridge affiliates, CCP II AIV II, L.P. (“CCP II AIV II”) and
Centerbridge Capital Partners SBS II, L.P. (“CCP SBS II”), which together will hold approximately 8.1%
of the New LightSquared Common Units.27 Finally, Harbinger, through HGW US Holding Company,

20
Application at 8. RLI will also indirectly hold 53.6% of the New LightSquared Series A-1 Preferred Units,
14.23% of the Series A-2 Preferred Units, 31.42% of the Series B Preferred Units, and 25.63% of the Series C
Preferred Units. Id.; see also id. at 7-8 nn.12-13 (noting the assumptions used to calculate percentages of preferred
unit holdings), Attach. D at 19-20 (defining New LightSquared Common and Preferred interests); September
Supplement, Attach. 3. Depending on the value ascribed to the various classes of interests, these common and
preferred unit holdings will equate to equity interests in New LightSquared ranging between 21.25% and 40.91%.
Application at 8. The ranges of equity ownership in New LightSquared provided by the Applicants are based on
alternative assumptions that Preferred or Common Units reflect 100% of the value of New LightSquared. May
Supplement at 4 n.5; Petition at 8 n.17.
21
Id. at 7, Attach. D at 61; September Supplement, Attach. 5 at 73, Section 8.2(a)(i). Membership of the New
LightSquared Board will be governed by the operating agreement of New LightSquared. See id., Attach. D at 60-61
(describing the composition of the New LightSquared Board under the New LightSquared Interest Holders
Agreement); see also September Supplement, Attach. 5. According to the Applicants, the New LightSquared Board
will exercise the power to appoint the members of the Board of Managers of LightSquared Sub. Application at 6.
On November 30, 2015, LightSquared filed a further Supplement providing a revised version of the New
LightSquared Operating Agreement reflecting the JPMorgan Proxy Agreement discussed herein. Letter from
Gerard J. Waldron, Counsel, LightSquared Subsidiary LLC, to Marlene H. Dortch, Secretary, FCC, IB Docket No.
15-126, at 2 (filed Nov. 30, 2015).
22
LSQ will be controlled by a non-member manager, Fortress Credit Advisors LLC, which in turn is ultimately
controlled by Fortress. See id. at 9. The Applicants state that LSQ may be structured as a series limited liability
company, but that this structure, if implemented, will not have a material effect on the ownership or control of New
LightSquared by Fortress. See September Supplement at 2 n.3.
23
Application at 8-9. LSQ will also hold 14.23% of the New LightSquared Series A-2 Preferred Units and 52.41%
of the Series B Preferred Units. Id.; see also September Supplement, Attach. 3. In addition, another entity
ultimately controlled by Fortress, CF LSQ C Holdings LLC, will hold 43.53% of the New LightSquared Series C
Preferred Units. Application at 9 n.15; see also September Supplement, Attach. 3. Depending on the value ascribed
to the various classes of interests, these holdings of Fortress-controlled entities together will equate to equity
interests in New LightSquared ranging between 16.29% and 26.2%. See May Supplement at 2. Fortress, however,
will hold indirectly less than 1% equity interest in New LightSquared. See Petition at 10.
24
See Application at 7, Attach. D at 61; September Supplement, Attach. 5 at 73, Section 8.2(a)(i).
25
May Supplement at 3; see also Application at 7, Attach. D at 61; September Supplement, Attach. 5 at 73, Section
8.2(a)(i).
26
See Application at 7, Attach. D at 61; Petition at 7; September Supplement, Attach. 5 at 73, Section 8.2(a)(i).
27
See Application at 10; May Supplement at 3. CCP II AIV II, L.P. and Centerbridge Capital Partners SBS II, L.P.
together will also directly hold 14.2% of the New LightSquared Series A-2 Preferred Units, 16.2% of the Series B
Preferred Units, and 0.3% of the Series C Preferred Units. See Application at 10; May Supplement at 3; September
Supplement, Attach. 3. Depending on the value ascribed to the various classes of interests, these common and
preferred unit holdings will equate to equity interests in New LightSquared ranging between 3.2% and 8.1%. See
Application at 10; May Supplement at 3.

4

Federal Communications Commission FCC 15-164

L.P. (“HGW US”),28 will hold approximately 44.45% of the New LightSquared Common Units.29
Harbinger’s interest, however, will not entitle it to appoint any members of the New LightSquared
Board.30
C. Application and Review Process
8. The Application and Petition were placed on Public Notice on June 1, 2015.31 On June
30, 2015, the Commission received a submission from the Department of Justice (“DOJ”), including the
Federal Bureau of Investigation, the Department of Homeland Security (“DHS”), and the Department of
Defense (“DOD”).32 In that filing, the DOJ, DHS, and DOD requested that the Commission defer action
on the Application and Petition until they had completed their review of any national security, law
enforcement, or public safety implications. Subsequently, on September 25, 2015, the DOJ submitted a
Petition to Adopt Conditions.33 The filing states that the DOJ has no objection to grant of the Application
and Petition provided that the Commission conditions its approval on the compliance by LightSquared
Sub and One Dot Six with an agreement entered into with the Applicants on September 24, 2015 to
address national security, law enforcement and public safety issues.34 In addition, the National
Association of Broadcasters submitted comments urging the Commission to reform its foreign ownership
policies in the broadcast context, but taking no position on the Application or Petition.35
III. DISCUSSION
A. Framework
9. The legal standards that govern our public interest analysis for the assignment or transfer
of licenses and other authorizations under sections 214(a) and 310(d) of the Act require that we weigh the
potential public interest harms against the potential public interest benefits to ensure that, on balance, the
proposed transaction will serve the public interest, convenience, and necessity.36 Our analysis begins with
28
See Application at 10-12; September Supplement at 4-5. The Applicants state that Falcone, a U.S. citizen,
ultimately controls HGW US as well as four Harbinger funds that indirectly hold a 100% equity interest in HGW
US. See Application at 10-11; September Supplement at 4-5.
29
Application at 10-12. HGW US will also directly hold 46.4% of the New LightSquared Series A-1 Preferred
Units and 0.59% of the Series C Preferred Units. Id. at 10; see also September Supplement, Attach. 3. Depending
on the value ascribed to the various classes of interests, the HGW US holdings will equate to equity interests in New
LightSquared ranging between 26.64% and 44.45%. Application at 10.
30
Id. at 7. In addition, the Applicants state that Harbinger’s interest will not entitle it to exercise voting power over
New LightSquared other than with respect to certain extraordinary matters. Id.; see also September Supplement,
Attachment 5 at 55-56, Section 5.5.
31
Pleading Cycle Established for Applications Filed by LightSquared Subsidiary LLC, Debtor-in-Possession, and
LightSquared Subsidiary, LLC, for FCC Consent to Assign Licenses and other Authorizations and Request for
Declaratory Ruling on Foreign Ownership, IB Docket No. 15-126, Public Notice, DA 15-653, 30 FCC Rcd 6036
(rel. June 1, 2015).
32
Letter from Mark G. McConnell, Attorney, DOJ, to Marlene H. Dortch, Secretary, FCC, IB Docket No. 15-126
(filed June 30, 2015).
33
Petition to Adopt Conditions to Authorizations and Licenses of the U.S. Department of Justice, IB Docket No. 15-
126 (filed Sept. 25, 2015).
34
See Agreement between LightSquared Subsidiary LLC and One Dot Six Corp. and the U.S. Department of
Justice, including the Federal Bureau of Investigation, IB Docket No. 15-126 (filed Sept. 25, 2015), available at
http://apps.fcc.gov/ecfs/document/view?id=60001325219 (“DOJ Agreement”).
35
Comments of the National Association of Broadcasters, IB Docket No. 15-126 (filed July 1, 2015).
36
See, e.g., Applications of Sprint Nextel Corp. and SoftBank Corp. and Starburst II, Inc. for Consent to Transfer
Control of Licenses and Authorizations, IB Docket No. 12-343, Memorandum Opinion and Order, Declaratory
Ruling, and Order on Reconsideration, 28 FCC Rcd 9642, 9650-51, ¶ 23 (2013) (“SoftBank-Sprint Order”).

5

Federal Communications Commission FCC 15-164

an examination of whether the Applicants are qualified to hold Commission licenses. Next, we consider
the Applicants’ request for a declaratory ruling on foreign ownership. Then we consider whether the
proposed assignments and transfer raise competitive concerns. Finally, we consider issues related to
national security, law enforcement, foreign policy, and trade policy.
B. Character Qualifications
10. As a threshold matter, we must determine whether the Applicants meet the requisite
citizenship, character, financial, technical and other qualifications to hold licenses under sections 308(b)
and 310(d) of the Act and the Commission’s rules.37 The focus of our review of an applicant’s character
qualifications is misconduct that demonstrates the applicant’s proclivity to deal truthfully with the
Commission and to comply with our rules and policies.38 We consider certain violations of the Act or of
the Commission’s rules or policies, as well as certain types of adjudicated, non-Commission-related
misconduct, including felony convictions and violations of antitrust laws.39 Where misconduct calls into
question an applicant’s character qualifications, we also consider certain “mitigating factors.”40 These
include the frequency of the misconduct; the nature of the participation, if any, of the managers and
owners; any remedial action taken to curb the conduct and/or dismiss the perpetrator; and the applicant’s
past record of compliance with Commission rules and policies.41
11. No party challenges the qualifications of the Applicants, and except as noted below, we
find no reason to reevaluate or further discuss the requisite qualifications of LightSquared Sub DIP, One
Dot Six DIP, and Harbinger,42 or of New LightSquared, LightSquared Sub, One Dot Six, Fortress, or
Centerbridge. With regard to the matter of the character qualifications of JPMorgan, we condition the
grant on JPMorgan entering into the proxy agreement, as discussed below, as an interim step until the
Commission can resolve that matter following the District Court’s resolution of the charges brought
against JPMorgan by the United States.
12. JPMorgan disclosed to the Commission on July 1, 2015, that it had entered into a Plea
Agreement with the United States Department of Justice, pursuant to which it had also entered a plea of
guilty to a felony antitrust violation and had agreed to a $550 million fine and a three-year period of
probation, during which it would be subject to certain ongoing obligations.43 The criminal conduct
37
See 47 U.S.C. §§ 308(b), 310(d); see also, e.g., SoftBank-Sprint Order, 28 FCC Rcd at 9652-53, ¶ 26.
38
See Policy Regarding Character Qualifications in Broadcast Licensing, Gen. Docket No. 81-500, Report, Order
and Policy Statement, 102 FCC 2d 1179, 1190-91, ¶ 23 (1986) (“1986 Character Policy Statement”). We look to
the Commission’s character policy initially developed in the broadcast area as guidance in resolving similar
questions in common carrier license assignment proceedings. See, e.g., Applications of Cellco Partnership d/b/a
Verizon Wireless and Atlantis Holdings LLC for Consent to Transfer Control of Licenses, Authorizations, and
Spectrum Manager and de facto Transfer Leasing Arrangements, WT Docket No. 08-95, Memorandum Opinion and
Order and Declaratory Ruling, 23 FCC Rcd 17444, 17464, ¶ 32 (2008) (“Verizon Wireless-ALLTEL Order”).
39
See, e.g., Verizon Wireless-ALLTEL Order, 23 FCC Rcd at 17464-65, ¶ 32.
40
See Policy Regarding Character Qualifications in Broadcast Licensing, Policy Statement and Order, 5 FCC Rcd
3252, 3252, ¶ 5 (1990) (“1990 Character Policy Statement”, and, along with the 1986 Character Policy Statement,
“Character Policy Statement”).
41
See 1986 Character Policy Statement, 102 FCC 2d at 1227-28, ¶ 102.
42
We generally do not reevaluate the qualifications of assignors unless issues related to basic qualifications have
been sufficiently raised in petitions to warrant designation for hearing, which is not the case here. See, e.g.,
SoftBank-Sprint Order, 28 FCC Rcd at 9653, ¶ 27.
43
Letter from Wayne D. Johnsen, Counsel for JPMorgan, to Marlene H. Dortch, Secretary, FCC, IB Docket No. 15-
126, at 1 (filed July 1, 2015) (“JPMorgan July Letter”); see also United States v. JPMorgan Chase & Co., Criminal
No. 3:15-CR-79 (SRU), Plea Agreement (D. Conn. May 20, 2015) (“Plea Agreement”), available at
http://www.justice.gov/file/440491/download. JPMorgan entered a plea of guilty to a one-count violation of the
Sherman Antitrust Act, 15 U.S.C. § 1. The District Court has not yet acted on the plea. September Supplement at 4.

6

Federal Communications Commission FCC 15-164

disclosed in the Plea Agreement relates to participation in a conspiracy to manipulate the price of the
euro/U.S. dollar currency pair exchanged in the foreign exchange market.44 Members of the corporate
conspiracy, all financial services firms acting as dealers in the foreign exchange market, coordinated their
trading of the euro/U.S. dollar currency pair to manipulate daily benchmark exchange rates and to protect
co-conspirators with open risk positions.45 JPMorgan has admitted in the Plea Agreement that it
participated in the conspiracy between at least July 2010 and January 2013.46
13. JPMorgan states that it has dismissed the trader principally involved in the conspiracy
that led to its felony antitrust guilty plea, and has implemented heightened controls to protect against such
misconduct in the future.47 JPMorgan argues that its past compliance with the Commission’s rules,
cooperation with the DOJ in its antitrust investigation, and remedial actions taken to prevent future
misconduct demonstrate that JPMorgan is willing and able to deal truthfully with the Commission and
comply with our rules and policies.48 However, various administrative and judicial proceedings remain
pending with respect to this matter, and JPMorgan is not yet in a position to fully address each of the
factors relevant to this inquiry by the Commission under the Character Policy Statement.
14. We ordinarily refrain from evaluating an applicant’s character based on mere allegations
of relevant non-FCC misconduct, even where those allegations have resulted in an indictment or are
otherwise being adjudicated by another agency or court. We, however, are confronted here with a unique
situation, a pending Plea Agreement premised on an admission of guilt, which Plea Agreement, under its
terms, would result in a judgment imposing a felony conviction unless the Court rejects the recommended
sentence specified in the Plea Agreement.49 Although the Plea Agreement has been executed by the
parties and JPMorgan has entered a plea of guilty, the Agreement awaits review and action by the Court.
In fact, JPMorgan has reserved its right to withdraw its guilty plea in the event that the court does not
accept the recommended sentence specified in the Plea Agreement, rendering that Agreement void.50
15. Under these circumstances, and in light of JPMorgan’s admissions of liability in the Plea
Agreement and in its proffered guilty plea, we could refrain from acting on the subject applications until
the Court has approved the Plea Agreement and accepted the recommended sentence therein or otherwise
convicted JPMorgan of the felony in question, and we could then determine the impact of such a
conviction, if any, on our public interest analysis and JPMorgan’s character qualifications to hold its
proposed interest in New LightSquared.51 At that time, we would consider the effect of such a conviction
on JPMorgan’s and, consequently New LightSquared’s, anticipated proclivity to deal truthfully with the
Commission and to comply with the Act and our rules and policies. However, in this case, the United

44
See Plea Agreement at 5-6, ¶¶ 4(g)-(i). The foreign exchange market is a global market in which currencies are
traded against one another in pairs. The euro/U.S. dollar currency pair is the most traded currency pair by volume.
During the time of the conspiracy, JPMorgan acted as a dealer for currency traded in the foreign exchange market.
See id. at 3-4, ¶¶ 4(b)-(d).
45
See id. at 6, ¶ 4(i).
46
See id. at 5, ¶ 4(g).
47
JPMorgan July Letter at 3; see also Plea Agreement at 10-11, ¶¶ 9(c)(iii)-(iv); Letter from Wayne D. Johnsen,
Counsel for JPMorgan, to Marlene H. Dortch, Secretary, FCC, IB Docket No. 15-126, at 5-8 (filed Oct. 6, 2015)
(“JPMorgan October Letter”).
48
See JPMorgan July Letter at 3; see also JPMorgan October Letter at 6-8.
49
See Plea Agreement at 16, ¶ 12(a); United States v. Barclays PLC, et al., Nos. 3:15-CR-77 (SRU), et al. at 18 (D.
Conn. May 20, 2015) (“Tr.”).
50
See Plea Agreement at 16, ¶ 12(b); Tr. at 18.
51
We retain discretion to condition license grants on the outcome of proceedings involving non-FCC misconduct.
See 1986 Character Policy Statement, 102 FCC 2d at 1204-05; 1990 Character Policy Statement, 5 FCC Rcd at
3252-23.

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States has agreed in the Plea Agreement to support a motion by JPMorgan to adjourn sentencing until the
Department of Labor has issued a ruling on JPMorgan’s request for a prohibited transaction exception to
permit it to continue as a qualified professional asset manager pursuant to Prohibited Transactions
Exemption 84-14.52 Moreover, there are private civil actions pending in other courts that relate to the
same underlying conduct, including a recently filed motion by class plaintiffs for preliminary approval of
settlement agreements with JPMorgan and certain other defendants, proposing payment of damages to
class plaintiffs and members of the settlement classes.53 To the extent that these civil actions address “the
efforts to remedy the wrong,” if and when they are adjudicated, they will relate directly to the
Commission’s consideration of character qualifications.54 Because we understand that resolution of these
matters is not imminent, we also must consider the potential impact of such a delay in our action on the
financial viability of LightSquared and the pendency of the bankruptcy proceeding. In considering such a
bankruptcy situation, “in recognition of the public interest in protecting innocent creditors, the
Commission will approve the sale and assignment of the bankrupt’s license when the transaction will not
unduly interfere with the FCC mandate to insure that [Commission] licenses are used and transferred
consistently with the Communications Act.”55
16. In the 1986 Character Policy Statement, the Commission noted that, even “prior to
adjudication” as to alleged non-FCC misconduct, it retains “discretion to condition the grant of a license
or permit on the outcome of related court or government agency proceedings, where such action is
deemed appropriate.”56 Given the pendency of such proceedings as described above, we believe a similar
approach is appropriate here. Serious allegations of misconduct have been raised against JPMorgan in
connection with manipulation of foreign currency exchange rates, and in that case those allegations have
now proceeded not just to the filing of an information or indictment but to the entry of a felony guilty
plea, albeit a conditional one that is subject to withdrawal. We believe that these allegations must be
addressed by the Commission before JPMorgan is permitted to acquire any interest in New LightSquared
that would be cognizable under the attribution rules applied in the Character Policy Statement. Such a
Commission inquiry would include an analysis of the frequency of the misconduct; the nature of the
participation, if any, of the managers and owners; any remedial action taken to curb the conduct and/or
dismiss the perpetrator; and the applicant’s past record of compliance with Commission rules and
policies.57 As noted above, JPMorgan is not currently in a position to provide complete responses with
respect to all of these relevant factors.
17. Accordingly, and in light of these unique circumstances, as an interim mechanism until
the Commission can rule on its character following the District Court’s resolution of the charges brought

52
Plea Agreement at 13, ¶ 9(e). See also Tr. at 37 (“need for regulatory waiver and…provisional plea agreement that
calls for the potential continuance of any sentencing until a later date”).
53
See In re Foreign Exchange Benchmark Rates Antitrust Litigation, Class Plaintiffs’ Memorandum of Law in
Support of Motion for Preliminary Approval of Settlement Agreements with Bank of America, Barclays, BNP
Paribas, Citigroup, Goldman Sachs, HSBC, JPMorgan, RBS, and UBS, No. 1:13-cv-07789-LGS (S.D.N.Y. filed
Oct. 22, 2015) (Motion for Preliminary Approval). See also JPMorgan Chase & Co., SEC Form 10-Q (Nov. 2,
2015), at 166 (reporting filing in September 2015 of two class actions in Canada).
54
1986 Character Policy Statement, 102 FCC 2d at 1228 ¶ 102. The proposed settlement currently pending, for
example, contemplates cash payments by JPMorgan totaling $104,500,000. Motion for Preliminary Approval,
Declaration of Christopher M. Burke and Michael D. Hausfeld ¶ 62. According to the DOJ, the Plea Agreement in
the criminal case includes no order of restitution “[i]n light of the availability of civil causes of action which
potentially provide up to treble damages.” Tr. at 22.
55
LaRose v. FCC, 494 F.2d 1145, 1148 (D.C. Cir. 1974), citing Shell Broadcasting, Inc., 38 FCC 2d 929, 931
(1973).
56
1986 Character Policy Statement, 102 FCC 2d at 1204-05, 1206 n.66.
57
See supra ¶ 10.

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Federal Communications Commission FCC 15-164

by the United States, JPMorgan has agreed to a Proxy Agreement by which it will be prohibited from
having any involvement in the management or operation of New LightSquared, and thus from any role in
New LightSquared’s “dealings with the Commission,” or influence on whether New LightSquared’s
operations will be “consistent with the requirements of the Communications Act and the Commission’s
rules and policies.”58 Under the terms of this Proxy Agreement, JPMorgan will grant to an independent
proxy holder (the “Holder”), the selection of which will be approved by the Commission, sole and
exclusive authority to exercise all management rights with respect to its ownership interest in New
LightSquared.59 These include the exercise of any voting, director appointment, consent, approval or
management rights arising under the New LightSquared Operating Agreement.60 Most significantly,
JPMorgan has further agreed that it will not communicate with the Holder, management of New
LightSquared, or the Holder’s appointed director regarding the management of the company. The Proxy
Agreement provides that the Holder’s proxy shall be irrevocable, and will terminate only upon a
Commission finding that JPMorgan possesses the requisite qualifications, including those of character, to
hold its New LightSquared interest without such restrictions on its permitted voice in the company’s
affairs, or otherwise with the Commission’s approval.61
18. In these circumstances, as noted above, the Proxy Agreement will ensure that JPMorgan
will have no role in New LightSquared that is relevant to the dual goals underlying the Commission’s
character policy:62 proclivity of the licensee to deal truthfully with the Commission and to comply with its
rules and policies.63 We nevertheless will condition our approval of the application on the requirements
that, prior to or contemporaneous with the consummation of the transactions approved herein, JPMorgan
and the other parties to the Proxy Agreement will fully execute the Proxy Agreement in the form provided
in JPMorgan’s November 30, 2015 Supplement to the Application and thereafter shall at all times remain
in compliance with the Proxy Agreement, including any amendment thereto subsequently approved by the
Commission, until it is terminated following Commission approval. Within ten (10) days after the release
of this Order, JPMorgan shall file with the Commission such fully executed Proxy Agreement.

58
See 1986 Character Policy Statement, 102 FCC 2d at 1189, ¶ 21; see also 1990 Character Policy Statement, 5
FCC Rcd at 3252, ¶ 3.
59
On November 6, 2015, JPMorgan further supplemented the Application to provide a copy of the form of the
Proxy Agreement and JPMorgan’s commitment to comply with its terms. Letter from Wayne D. Johnsen, Counsel
for JPMorgan, to Marlene H. Dortch, Secretary, FCC, IB Docket No. 15-126, at 1 (filed Nov. 6, 2015). On the same
day, it filed another supplement to provide information regarding Julian Markby, JPMorgan’s proposed Holder
pursuant to that Agreement. Letter from Wayne D. Johnsen, Counsel for JPMorgan, to Marlene H. Dortch,
Secretary, FCC, IB Docket No. 15-126, at 1 (filed Nov. 6, 2015). On November 9, it filed a further supplement
regarding Mr. Markby’s citizenship. Letter from Wayne D. Johnsen, Counsel for JPMorgan, to Marlene H. Dortch,
Secretary, FCC, IB Docket No. 15-126, at 1 (filed Nov. 9, 2015). On November 30, it filed another supplement,
providing a revised version of the form of the Proxy Agreement and a re-confirmation of JPMorgan’s commitment
to comply with its terms. Letter from Wayne D. Johnsen, Counsel for JPMorgan, to Marlene H. Dortch, Secretary,
FCC, IB Docket No. 15-126, at 1 (filed Nov. 30, 2015). In reliance on the materials so provided, we conclude that
Mr. Markby is sufficiently independent of JPMorgan and otherwise qualified under our rules and policies to so
serve.
60
With regard to JPMorgan’s current right to appoint a director, although JPMorgan may recommend three possible
nominees independent of it to the Holder, the Holder will have the right to reject those individuals, and any others
that JPMorgan may nominate until the Holder identifies and appoints a candidate that is acceptable to the Holder.
Such director shall have no special fiduciary obligation to JPMorgan, but shall owe fiduciary duties that are
customary of any other directors serving on the board of a limited liability company. Proxy Agreement, Section 3.2.
61
See id., Section 5.1.
62
See 1986 Character Policy Statement, 102 FCC 2d 1179, 1205-06, ¶ 48 (limiting character inquiry to interests
“recognized and attributed under the multiple ownership rules.”).
63
See id. at 1190-91, ¶ 23.

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Moreover, within thirty (30) days of either the docketing of the judgment in United States of America v.
JPMorgan Chase & Co., Criminal No. 3:15-CR-79 (SRU) (D. Conn.) in connection with the DOJ Plea
Agreement, or other resolution by the District Court of the charges brought by the United States in such
action (either such event, the “Court Action”), JPMorgan will provide written notice to the Commission
regarding such Court Action. As soon thereafter as is reasonably practicable in light of the status of then-
pending judicial or other governmental proceedings, including enforcement actions, related to
JPMorgan’s trading activities in the foreign currency exchange market, but in no event more than three
(3) years after the Court Action, JPMorgan shall make a filing with the Commission stating, in light of
that Court Action, under what terms JPMorgan proposes to hold its interest in New LightSquared and
provide the Commission with information that JPMorgan believes to be relevant to a determination by the
Commission, applying as guidance its 1986 Character Policy Statement and 1990 Character Policy
Statement and pertinent precedent, of whether JPMorgan has the requisite character to hold its interest in
New LightSquared.64 The Commission will then decide what action is appropriate with respect to such
equity interest. In this manner, we may act expeditiously to protect LightSquared’s other creditors, yet
ensure that JPMorgan will have no role in its management until we have resolved the matter of its
character, and the question whether it has the requisite character qualifications to continue to hold its
interests in LightSquared conditionally approved herein. We conclude that our acceptance of JPMorgan’s
proposal is in the public interest in light of the unique situation presented to us here by the status of the
pending proceedings involving JPMorgan, the absence of any concerns about the impact of JPMorgan’s
equity investment on competition in the provision of communications services to be offered by New
LightSquared, the goal of facilitating New LightSquared’s exit from the long-pending bankruptcy
proceeding, and the positive impact of expeditious action on the significant interests of LightSquared’s
creditors.
C. Foreign Ownership
19. LightSquared Sub requests a declaratory ruling, pursuant to section 310(b)(4) of the Act
and section 1.990(a)(1) of the Commission’s rules,65 to permit foreign ownership of its reconstituted
controlling U.S.-organized parent, New LightSquared, to exceed the 25% benchmark in section
310(b)(4).66 According to LightSquared Sub, entities deemed to be foreign would hold an aggregate
equity interest in New LightSquared of between approximately 40% and 70% through Fortress,
Harbinger, JPMorgan, and Centerbridge, and their respective subsidiaries and affiliates.67
20. Section 1.991(i) of the Commission’s rules requires that LightSquared Sub seek specific
approval for any foreign investor, or “group” of foreign investors as defined in the rules, that would hold
directly and/or indirectly more than 5% (or 10% in certain circumstances) of the equity and/or voting
interests, or a controlling interest, in LightSquared Sub’s controlling U.S. parent, New LightSquared.68
According to LightSquared Sub, there are no foreign investors that will hold interests in New

64
See 47 U.S.C. §§ 308(b), 310(d); Verizon Wireless-ALLTEL Order, 23 FCC Rcd at 17464, ¶ 32; 1986 Character
Policy Statement, 102 FCC 2d 1179; 1990 Character Policy Statement, 5 FCC Rcd 3252.
65
47 C.F.R. § 1.990(a)(1).
66
The rules applicable to foreign ownership of common carrier licensees and spectrum lessees are set forth in
sections 1.990 through 1.994 of the Commission’s rules, 47 C.F.R. §§ 1.990-1.994. See also Review of Foreign
Ownership Policies for Common Carrier and Aeronautical Radio Licensees Under Section 310(b)(4) of the
Communications Act of 1934, as Amended, IB Docket No. 11-133, Second Report and Order, FCC 13-50, 28 FCC
Rcd 5741 (2013) (“2013 Foreign Ownership Second Report and Order”).
67
See Petition at 8. The Petition states that foreign ownership interests would be held in New LightSquared through
Fortress (at 8-12), JPMorgan (at 12-14), Centerbridge (at 14-17), and Harbinger (at 17-22); and provides illustrative
ownership diagrams for New LightSquared and the relevant investing entities.
68
47 C.F.R. § 1.991(i).

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Federal Communications Commission FCC 15-164

LightSquared through JPMorgan that require specific approval under section 1.991(i) of the rules.69
Foreign investment in Harbinger, Fortress and Centerbridge is discussed below. In addition to its four
principal investors, certain other entities will own interests in New LightSquared, but LightSquared Sub
states that none of these “will hold directly a 10% or greater equity interest in New LightSquared.”70
LightSquared Sub has certified that, to the best of its knowledge and belief, no individual, entity, or group
other than those identified in the Petition will hold an equity and/or voting interest in New LightSquared
upon consummation of the reorganization requiring specific approval under the Commission’s foreign
ownership rules.71
21. Harbinger. With respect to Harbinger’s investment, and pursuant to section 1.991(i) of
the rules, LightSquared Sub requests that the Commission specifically approve foreign equity and voting
interests that would be held indirectly in New LightSquared through HGW US, a Delaware limited
partnership whose principal business is acting as a holding company.72 For purposes of calculating New
LightSquared’s foreign voting interests under section 1.991 of the rules, LightSquared Sub has treated
HGW US as if it were an uninsulated member of New LightSquared that is deemed to hold a 100% voting
interest.73 This approach results in the following calculations of foreign equity and voting interests that
69
Based on JPMorgan’s most recent proxy statement, LightSquared Sub states that only two Delaware corporations
hold a 5% or greater equity or voting interest in JPMorgan: BlackRock, Inc. and The Vanguard Group. See
September Supplement at 2.
70
Petition at 4 n.7. According to the Petition, these other direct interest holders will be insulated in accordance with
section 1.993 of the rules. See id. at 7 n.12; see also id. at 21 n.35. Alford Investment Strategies Ltd. (“Alford”), a
Cayman Islands Exempted Company whose principal business is acting as a holding company, will hold direct and
indirect interests in New LightSquared. Id. at 21 n.35. Alford is wholly owned by the Abu Dhabi Investment
Council (“ADIC”). ADIC is a government institution of Abu Dhabi, an emirate of the U.A.E. Id. at 6 n.11; see also
id. at 21-22. Alford will directly hold insulated New LightSquared Series C Preferred Units constituting 6.25% of
the New LightSquared Preferred Units and 0% of the New LightSquared Common Units. Id. at 21 n.35. Alford will
also indirectly hold, through funds controlled by Harbinger, 2.69% to 4.49% of New LightSquared’s equity and
23.37% of its voting interests. Id. at 21. Thus, Alford will hold direct and indirect voting interests in New
LightSquared of 29.62%. Id. at 21, n.35. Due to the potential range of equity investment depending on the relative
values of New LightSquared’s Common and Preferred Units, Alford will hold an aggregate direct and indirect
equity investment in New LightSquared of 4.49% to 8.94%. See id. at 21 n.35; see also supra n.20 (range of equity
interests).
71
See October Supplement, Attach. 4. LightSquared Sub’s certification is based on the assumption that the
Commission will find Fortress is properly treated as a corporation for purposes of calculating foreign voting
interests held in New LightSquared, and that the foreign limited partners of Centerbridge affiliate CCP SBS II are
insulated under the Commission’s rules. Id.
72
See Petition at 18-23.
73
Sections 1.992 and 1.993 of the Commission’s rules specify the methodology for calculating the foreign equity
and voting interests in the controlling U.S. parent of a common carrier licensee that require specific approval under
section 1.991(i) of the rules. Equity interests held indirectly in the controlling U.S. parent are calculated using a
“multiplier” to dilute the percentage of each investor’s equity interest when those interests are held through
intervening companies. See 47 C.F.R. § 1.992(b)(1); 2013 Foreign Ownership Second Report and Order, 28 FCC
Rcd at 5803, ¶ 118. For purposes of calculating the percentage of foreign voting interests held indirectly in the
controlling U.S. parent through one or more intervening partnerships or limited liability companies (“LLCs”), a
general partner, uninsulated limited partner or uninsulated LLC interest holder (including a non-member manager) is
considered to hold the same voting interest as the partnership or LLC holds in the company situated in the next
lower tier of the vertical ownership chain. Id. at 5803-04, ¶ 119, 5806, ¶ 124. Similarly, where the U.S. parent is
itself organized as a partnership or LLC (as is the case here), a general partner or other uninsulated interest holder is
considered to hold a controlling (100%) voting interest in the U.S. parent. Id. For purposes of calculating voting
interests held directly or indirectly in New LightSquared, the Petition also properly ascribes a 100% voting interest
in New LightSquared to each entity affiliated with Fortress, JPMorgan, and Centerbridge that would hold a
membership interest in New LightSquared. The Petition does not assert that any of these entities is insulated within
the meaning of section 1.993 of the Commission’s rules.

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would be held directly and/or indirectly in New LightSquared in connection with Harbinger’s investment
that require specific approval under section 1.991(i):74
HGW Holding Company, L.P. (100% voting and 9.38-15.65% equity interest);
HGW GP, Ltd. (100% voting and less than 0.1% equity interest);
Harbinger Capital Partners Master Fund I, Ltd. (70.1% voting and 18.66-31.33% equity interest);
Harbinger Class PE Holdings (Cayman), Ltd. (16.73% voting and 4.46-7.44% equity interest);
Harbinger Capital Partners Intermediate Fund I, Ltd. (70.1% voting and 9.49-15.84% equity
interest);
Harbinger Capital Partners Offshore Fund I, Ltd. (70.1% voting and 8.01-13.36% equity interest);
Alford Investment Strategies Ltd. (29.62% voting and 4.49-8.94% equity interest);
Abu Dhabi Investment Council (29.62% voting and 4.49-8.94% equity interest); and
Harbinger Capital Partners Special Situations Offshore Fund, L.P. (16.02% voting and 4.27-
7.12% equity interest).
22. The Petition also requests advance approval, under section 1.991(k)(2) of the
Commission’s rules,75 for the foregoing entities to increase their interests in New LightSquared up to and
including a non-controlling 49.99% equity and/or voting interest.76 Advance approval is also requested
for these entities to increase their respective interests up to and including a 100% direct or indirect equity
and/or voting interest in HGW US77 which, as discussed above, will hold a minority interest in New
LightSquared.
23. Fortress. The Petition requests that Fortress, as a widely-held, publicly traded limited
liability company (“LLC”), be treated in the same manner as a corporation for purposes of calculating
foreign voting interests that would be held indirectly in New LightSquared through Fortress.78 Fortress
will hold indirectly less than 1% equity interest in New LightSquared. As an uninsulated member of New
LightSquared, however, Fortress is deemed to hold a 100% voting interest in New LightSquared under
section 1.992 of the rules.79 The public shareholders of Fortress (who are members of Fortress under its
LLC agreement) are also uninsulated and, as such, each foreign shareholder of Fortress is deemed to hold
a 100% voting interest in New LightSquared under section 1.992 and requires specific approval under

74
The equity percentages for HGW Holding Company, L.P. and HGW GP Ltd. are lower than in the Petition due to
a subsequent internal reorganization of the Harbinger entities. September Supplement at 4-5.
75
47 C.F.R. § 1.991(k)(2).
76
Petition at 23.
77
Id.
78
Petition at 10-11.
79
Where the controlling U.S. parent of a licensee is itself organized as a partnership or LLC (as is the case here), a
general partner or other uninsulated interest holder is considered to hold a controlling (100%) voting interest in the
U.S. parent. The Commission’s treatment of uninsulated interests in a limited liability company (as in a limited
partnership) is based on the concern that the partners in a limited partnership or members of a limited liability
company, through contractual arrangements, largely have the power themselves to determine the rights of the
limited partners or members. See 2013 Foreign Ownership Second Report and Order, 28 FCC Rcd at 5804, ¶ 119
n.317 (citing Reexamination of the Commission’s Rules and Policies Regarding the Attribution of Ownership
Interests in Broadcast, Cable Television and Newspaper Entities, Memorandum Opinion and Order, MM Docket
No. 83-46, 1 FCC Rcd 802, 803-04, ¶ 9 (1986) (footnotes omitted)). Thus, unlike the powers of a voting
stockholder, the powers of a limited partner or LLC member are not necessarily dependent upon the extent of the
partner’s or member’s equity holdings. Id. at 804, ¶ 10.

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Federal Communications Commission FCC 15-164

Board of Directors shall have the power and authority to appoint Officers of the Company.”90 The
authority and functions of the board and the officers “shall be identical to the authority and functions of
the board of directors and officers, respectively, of a corporation organized under the [Delaware General
Corporation Law].”91 The Fortress LLC Agreement also provides that the officers and directors of
Fortress owe the same duties and obligations to Fortress and its members as would be required of the
officers and directors of a corporation organized under the Delaware General Corporation Law.92 Further,
“[n]o Member, by virtue of its status as such, shall have any management power over the business and
affairs of the Company or actual or apparent authority to enter into, execute or deliver contracts on behalf
of, or to otherwise bind, the Company.”93 We find nothing in the LLC Agreement that suggests that the
Class A shareholders have any greater measure of influence over the affairs of the company than they
would as shareholders of a Delaware corporation. Indeed, the LLC Agreement specifies that they do not.
26. We find, on the basis of the record in this proceeding, that Fortress is governed in a
manner similar to a corporation. Pursuant to the Commission’s 2013 Foreign Ownership Second Report
and Order, we permit LightSquared Sub to ascribe a voting interest in New LightSquared to Fortress’
public shareholders that is equal to their respective voting interests in Fortress for purposes of identifying
foreign voting interests held indirectly in New LightSquared that require specific approval under sections
1.991(i) and 1.994(a)(1) of the rules.94 Because we find that none of Fortress’ public shareholders would
hold as much as 5% of the total voting or equity interests in Fortress or, in turn, in New LightSquared,
LightSquared Sub is not required to identify and request specific approval for any foreign public
shareholder of Fortress pursuant to sections 1.991(i) and 1.994(a)(1) of the rules. Our determination that
LightSquared Sub may ascribe a voting interest in New LightSquared to the public shareholders of
Fortress that is equal to their respective voting interests in Fortress shall continue in effect for so long as
Fortress shares remain publicly traded and subject to Exchange Act Rule 13d-1, and the provisions of the
LLC Agreement and the Shareholders Agreement remain in effect with no material change.95 We require,
as a condition of our finding, that LightSquared Sub notify the International Bureau staff 30 days prior to
the occurrence of an event that would be inconsistent with these conditions, and to seek specific approval
under section 1.994(a)(1) of the rules based on its calculation of foreign interests held in New

(Continued from previous page)
Agreement provides information on the number of directors that the principals may nominate to Fortress’ board of
directors, which is based on the percentage ownership the principals have in Fortress. See October Supplement at 3
(citing Section 4.1 of the Shareholders Agreement, included as Attach. 2 to the October Supplement). Fortress is
listed on the New York Stock Exchange (“NYSE”). Under NYSE rules, a company is required to comply with the
requirement to have a majority of independent directors unless the company is a “controlled company,” with more
than 50% of voting power for the election of directors held by an individual or group. New York Stock Exchange
Listed Company Manual, Section 303A.00 Corporate Governance Standards, available at
http://nysemanual.nyse.com/LCMTools/PlatformViewer.asp?selectednode=chp_1_4_3&manual=%2Flcm%2Fsectio
ns%2Flcm-sections%2F. LightSquared Sub notes that, as recently announced, Mr. Novogratz is expected to retire
from Fortress and the Board of Directors at year end. When this occurs, the ownership of Fortress by the principals
will fall below 50% and Fortress will become subject to the NYSE requirement to have a majority of independent
directors. October Supplement at 3 n.12.
90
See October Supplement at 2-3 n.9 (citing Petition at Attach. E (Fourth Amended and Restated Limited Liability
Company Agreement of Fortress Investment Group LLC, § 5.1)).
91
Id.
92
Id. at 3 (citing Fortress LLC Agreement, § 5.23(a)).
93
Id.
94
2013 Foreign Ownership Second Report and Order, 28 FCC Rcd at 5807 n.331.
95
17 C.F.R. § 240.13d-1(b). The “Exchange Act” referenced herein is the Securities Exchange Act of 1934, as
amended, 15 U.S.C. §§ 78a et seq. See September Supplement at 2 (“individuals and entities with a five percent or
greater interest [in Fortress] are required to file a Schedule 13-D or Schedule 13-G with the SEC”).

14

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II limited partnership agreement and the certification provided by Centerbridge satisfy the concerns
underlying the insulation criteria for limited partners in section 1.993 of the Commission’s rules.103 We
therefore ascribe a voting interest to the foreign limited partners of CCP SBS II that is equal to their
respective equity interests in the partnership for purposes of identifying foreign voting interests held
indirectly in New LightSquared through Centerbridge that require specific approval under sections
1.991(i) and 1.994(a)(1) of the Commission’s rules. We find that none of the foreign limited partners of
CCP SBS II will have an equity or voting interest in New LightSquared of a magnitude that requires
specific approval under section 1.991(i) of the Commission’s rules.
29. Section 310(b)(4) Petition for Declaratory Ruling. We grant LightSquared Sub’s Petition
subject to the conditions set out below. We received no comments objecting to grant of the Petition, and
the DOJ has advised the Commission that it has no objection to the Commission approving the authority
sought provided that the Commission conditions its approval on the compliance by LightSquared Sub and
One Dot Six with the commitments and undertakings set forth in the September 24, 2015 Agreement from
LightSquared Sub and One Dot Six to the DOJ.104 We also find that the proposed foreign ownership of
LightSquared Sub’s controlling U.S.-organized parent, New LightSquared, will serve the public interest
by providing the capital necessary to allow the LightSquared entities to emerge from bankruptcy,
consistent with the broad aims of the Bankruptcy Code,105 the Act and the Commission’s rules and
policies. As explained below, we find no evidence that the proposed transaction is likely to harm
competition involving MSS or other telecommunications service offerings. Thus, pursuant to the rules
and policies established by the Commission’s 2013 Foreign Ownership Second Report and Order, we
find that the public interest would not be served by prohibiting foreign ownership of LightSquared Sub in
excess of the 25% benchmark in section 310(b)(4) of the Act.
30. Specifically, this ruling permits aggregate foreign ownership of LightSquared Sub’s
controlling U.S. parent, New LightSquared, to exceed, directly and/or indirectly, 25% of its equity and/or
voting interests, subject to the terms and conditions set forth below and in section 1.994 of the
Commission’s rules, including the requirement to obtain Commission approval before LightSquared
Sub’s foreign ownership exceeds the terms and conditions of this ruling. In addition, this ruling
specifically permits the Harbinger Named Entities106 to hold equity and/or voting interests directly and/or
indirectly in New LightSquared up to and including the amounts in paragraph 21 above; grants advance
approval, under section 1.991(k)(2) of the rules, for the Harbinger Named Entities to increase their
respective interests, individually or in the aggregate, in New LightSquared up to and including a non-
controlling 49.99% equity and/or voting interest; and grants advance approval for the Harbinger Named
Entities to increase their respective interests, individually or in the aggregate, up to and including a 100%
direct or indirect equity and/or voting interest in HGW US as a minority investor in New LightSquared.
LightSquared Sub is also required to notify the Commission 30 days prior to the shares of Fortress no
longer being publicly traded and subject to Exchange Act Rule 13d-1 or any material change to the
provisions of the LLC Agreement and the Shareholders Agreement. Effective upon the occurrence of

103
The Commission’s treatment of uninsulated interests in a limited partnership (or in a limited liability company) is
based on the concern that the partners in a limited partnership or members of a limited liability company, through
contractual arrangements, largely have the power themselves to determine the rights of the limited partners or
members.
104
See supra section II.C.
105
See, e.g., LaRose v. FCC, 494 F.2d 1145 (D.C. Cir. 1974).
106
The “Harbinger Named Entities” and the equity and/or voting interests each would hold directly and/or indirectly
in New LightSquared upon consummation of the proposed reorganization are listed in paragraph 21, supra. The
Harbinger Named Entities consist of the following: HGW Holding Company, L.P., HGW GP, Ltd., Harbinger
Capital Partners Master Fund I, Ltd., Harbinger Class PE Holdings (Cayman), Ltd., Harbinger Capital Partners
Intermediate Fund I, Ltd., Harbinger Capital Partners Offshore Fund I, Ltd., Alford Investment Strategies Ltd., Abu
Dhabi Investment Council, and Harbinger Capital Partners Special Situations Offshore Fund, L.P.

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Federal Communications Commission FCC 15-164

such event, LightSquared Sub shall be required to file any necessary requests for specific approval
required under section 1.994(a)(1) based on its calculation of foreign interests held in New LightSquared
through Fortress in accordance with the generally applicable requirements for LLC interests under section
1.992. Grant of the Petition is also conditioned on LightSquared Sub’s compliance with the commitments
and undertakings set forth in the DOJ Agreement.
31. LightSquared Sub has an affirmative duty to monitor its foreign equity and voting
interests, calculate these interests consistent with the attribution principles enunciated by the Commission,
including the standards and criteria set forth in sections 1.992 through 1.993 of the Commission’s rules,
47 C.F.R. §§ 1.992-1.993, and otherwise ensure continuing compliance with the provisions of section
310(b) of the Act.
D. Competitive Analysis
32. Our public interest analysis must also consider the competitive effects of the proposed
transaction.107 In this case, the Applicants represent that none of JPMorgan, Fortress, Centerbridge, or
Harbinger holds any significant interest in any satellite or other wireless telecommunications provider.108
They argue, therefore, that the proposed transaction will have no adverse effect on market concentration
or otherwise harm competition. Rather, the Applicants contend that the emergence of LightSquared
entities from bankruptcy, with significant new investment, will enhance their ability to provide existing
and new competitive services to the public.109
33. The record contains no evidence that the proposed transaction is likely to harm
competition involving MSS or other telecommunications service offerings.110 Further, we find that grant
of the Application might tend to improve competition by permitting LightSquared Sub and One Dot Six
to emerge from bankruptcy with access to significant new capital, furthering the viability of their service
offerings. We conclude, therefore, that grant of the Application will not harm competition, and will serve
the public interest.
E. National Security, Law Enforcement, Foreign Policy, and Trade Policy
34. When analyzing an assignment application in which foreign investment is involved, we
also consider any national security, law enforcement, foreign policy, or trade policy concerns raised by
the Executive Branch.111 As noted above, LightSquared Sub and One Dot Six have entered into an
agreement with the DOJ addressing such concerns.112
35. In assessing the public interest, we take into account the record and consider the national
security, law enforcement, foreign policy and trade concerns raised by the Executive Branch as we

107
See, e.g., Harbinger Transfer Order, 24 FCC Rcd 3059, ¶ 29.
108
See Application at 16-17; May Supplement at 7.
109
See Application at 14-16.
110
Pursuant to section 63.24 of the rules, the Applicants state that LightSquared Sub DIP is, and LightSquared Sub
would be upon consummation of the proposed transaction, under 100% common ownership with two foreign
carriers that are authorized to operate in Canada (SkyTerra (Canada) Inc., and LightSquared Corp.). The Applicants
note that LightSquared Sub DIP is currently classified as a “non-dominant” carrier in its provision of U.S.
international service under its international section 214 authorizations that would be transferred at closing to
LightSquared Sub. Application at 18-20. They assert, and we agree, that LightSquared Sub continues to qualify as
a non-dominant U.S. international carrier in its provision of service between the United States and Canada. And,
according to the Application, no new foreign carrier affiliations will result from the proposed reorganization. Id.
111
Rules and Policies on Foreign Participation in the U.S. Telecommunications Market: Market Entry and
Regulation of Foreign-Affiliated Entities, IB Docket Nos. 97-142 and 95-22, Report and Order and Order on
Reconsideration, 12 FCC Rcd 23891, 23918-21, ¶¶ 59-66 (1997) (“Foreign Participation Order”).
112
See DOJ Agreement, supra section II.C.

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Federal Communications Commission FCC 15-164

undertake our independent public interest analysis.113 As the Commission stated in the Foreign
Participation Order, foreign participation in the U.S. telecommunications market may implicate
significant national security or law enforcement issues uniquely within the expertise of the Executive
Branch.114 In accordance with the request of the DOJ, we condition our grant of the Application and
Petition on Applicants’ compliance with the commitments and undertakings set forth in the DOJ
Agreement.
IV. CONCLUSION
36. Upon review of the Application, the Petition, and the record, we conclude that grant of
the Application and Petition, subject to the conditions set forth below, is in the public interest.
V. ORDERING CLAUSES
37. Accordingly, IT IS ORDERED that, pursuant to Sections 4(i)-(j), 214, 303(r), 309 and
310(d) of the Communications Act of 1934, as amended, 47 U.S.C. §§ 154(i)-(j), 214, 303(r), 309,
310(d), the applications for consent to assign the licenses and authorizations of, and to transfer the
domestic section 214 authority of, LightSquared Subsidiary LLC, Debtor-in-Possession to LightSquared
Subsidiary LLC, and the application to assign the wireless lease authorization of One Dot Six Corp.,
Debtor-in-Possession to One Dot Six LLC, listed in the Appendix, ARE GRANTED, as conditioned in
this Memorandum Opinion and Order and Declaratory Ruling.
38. IT IS FURTHER ORDERED that, pursuant to Sections 4(i)-(j) and 310(b) of the
Communications Act of 1934, as amended, 47 U.S.C. §§ 154(i)-(j), 310(b), and Section 1.2 of the
Commission’s rules, 47 C.F.R. § 1.2, the Petition for Declaratory Ruling filed by LightSquared
Subsidiary, LLC IS GRANTED to the extent set forth herein, and otherwise DENIED.
39. IT IS FURTHER ORDERED that, pursuant to Sections 4(i)-(j) and 310(b) of the
Communications Act of 1934, as amended, 47 U.S.C. §§ 154(i)-(j), 310(b), and Section 1.41 of the
Commission’s rules, 47 C.F.R. § 1.41, the Petition to Adopt Conditions of the U.S. Department of Justice
IS GRANTED.
40. IT IS FURTHER ORDERED that, pursuant to Sections 4(i)-(j), 303(r), and 310(b) of the
Communications Act of 1934, as amended, 47 U.S.C. §§ 154(i)-(j), 303(r), 310(b), grant of the Petition
for Declaratory Ruling IS CONDITIONED UPON LightSquared Subsidiary LLC notifying the
Commission 30 days prior to the shares of Fortress Investment Group LLC no longer being publicly
traded and subject to Exchange Act Rule 13d-1 or any material change to the provisions of the LLC
Agreement and the Shareholders Agreement. Effective upon the occurrence of such event, LightSquared
Subsidiary LLC shall be required to file any necessary requests for specific approval required under 47
C.F.R. § 1.994(a)(1) based on its calculation of foreign interests held in New LightSquared through
Fortress Investment Group LLC in accordance with the generally applicable requirements for LLC
interests under 47 C.F.R. § 1.992.
41. IT IS FURTHER ORDERED that, pursuant to Sections 4(i)-(j), 214, 303(r), 309, 310(b),
and 310(d) of the Communications Act of 1934, as amended, 47 U.S.C. §§ 154(i)-(j), 214, 303(r), 309,
310(b), 310(d), grant of the applications and Petition for Declaratory Ruling IS CONDITIONED UPON
compliance by LightSquared Subsidiary LLC and One Dot Six LLC with the provisions of the Agreement
between themselves and the U.S. Department of Justice dated September 24, 2015. Any failure to comply
and/or remain in compliance with any of these commitments and undertakings shall constitute a failure to
meet a condition of the underlying authorizations and licenses and thus grounds for declaring the
authorizations and licenses terminated without any further action on the part of the Commission. Failure

113
See Foreign Participation Order, 12 FCC Rcd at 23918-21, ¶¶ 59-66.
114
Id., 12 FCC Rcd at 23919, ¶ 62.

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Federal Communications Commission FCC 15-164

to meet a condition of the license may also result in monetary sanctions or other enforcement action by
the Commission.
42. IT IS FURTHER ORDERED that, pursuant to Sections 4(i)-(j), 214, 303(r), 308, 309,
and 310(d) of the Communications Act of 1934, as amended, 47 U.S.C. §§ 154(i)-(j), 214, 303(r), 308,
309, 310(d), grant of the applications IS CONDITIONED as follows: prior to or contemporaneous with
the consummation of the transactions approved herein, JPMorgan and the other parties to the Proxy
Agreement will fully execute the Proxy Agreement in the form provided in JPMorgan’s November 30,
2015 Supplement to the Application and thereafter shall at all times remain in compliance with the Proxy
Agreement, including any amendment thereto subsequently approved by the Commission, until it is
terminated following Commission approval. Within ten (10) days after the release of this Order,
JPMorgan shall file with the Commission such fully executed Proxy Agreement. Moreover, within thirty
(30) days of either the docketing of the judgment in United States of America v. JPMorgan Chase & Co.,
Criminal No. 3:15-CR-79 (SRU) (D. Conn.) in connection with the DOJ Plea Agreement, or other
resolution by the District Court of the charges brought by the United States in such action (either such
event, the “Court Action”), JPMorgan will provide written notice to the Commission regarding such
Court Action. As soon thereafter as is reasonably practicable in light of the status of then-pending
judicial or other governmental proceedings, including enforcement actions, related to JPMorgan’s trading
activities in the foreign exchange market, but in no event more than three (3) years after the Court Action,
JPMorgan shall make a filing with the Commission stating, in light of that Court Action, under what
terms JPMorgan proposes to hold its interest in New LightSquared and provide the Commission with
information that JPMorgan believes to be relevant to a determination by the Commission, applying as
guidance its Policy Regarding Character Qualifications in Broadcast Licensing, Report, Order and Policy
Statement, 102 FCC 2d 1179 (1986), and its Policy Regarding Character Qualifications in Broadcast
Licensing, Policy Statement and Order, 5 FCC Rcd 3252 (1990) and pertinent precedent, of whether
JPMorgan has the requisite character to hold its interest in New LightSquared.
43. IT IS FURTHER ORDERED that the above grant shall include authority for reorganized
LightSquared entities to acquire control of: (1) any authorizations issued to LightSquared Inc. or its
subsidiaries while the assignment applications are pending before the Commission and during the period
required for consummation of the transaction; (2) any construction permits held by LightSquared Inc. or
its subsidiaries that mature into licenses after closing; (3) any applications or lease notifications filed by
LightSquared Inc. or its subsidiaries that are pending at the time of consummation; and (4) any leases of
spectrum into which LightSquared Inc. or its subsidiaries enter into as lessees while the assignment
applications are pending and during the period required for consummation.
44. IT IS FURTHER ORDERED that this Memorandum Opinion and Order and Declaratory
Ruling SHALL BE EFFECTIVE upon adoption, in accordance with 47 C.F.R. § 1.103.

FEDERAL COMMUNICATIONS COMMISSION

Marlene H. Dortch
Secretary

19

Federal Communications Commission FCC 15-164

APPENDIX

Part 25 – Satellite Communications Licenses

The following applications for consent to the assignment of space station and earth station
licenses from LightSquared Sub DIP to LightSquared Sub have been assigned the file numbers listed
below:

Satellite Space Station Licenses

File No. Licensee Call Sign
SAT-ASG-20150406-00017 LightSquared Subsidiary LLC, S2358
Debtor-in-Possession

SAT-ASG-20150409-00021 LightSquared Subsidiary LLC, AMSC-1
Debtor-in-Possession

Satellite Earth Station Licenses – Fixed

File No. Licensee Call Sign
SES-ASG-20150406-00192 LightSquared Subsidiary LLC, E080030
Debtor-in-Possession E080031
E100051
E130161
E930124

Satellite Earth Station Licenses – Mobile

File No. Licensee Call Sign
SES-ASG-20150406-00191 LightSquared Subsidiary LLC, E930367
Debtor-in-Possession E980179

Parts 90 and 101 – Private Wireless Licenses

The following application for consent to the assignment of private wireless licenses from
LightSquared Sub DIP to LightSquared Sub has been assigned the file number listed below:

File No. Licensee Call Sign
0006726911 LightSquared Subsidiary LLC, WQHL596
Debtor-in-Possession WQMN726

20

Federal Communications Commission FCC 15-164

Part 27 – Misc. Wireless Services De Facto Transfer Lease

The following application for a long-term de facto transfer spectrum leasing arrangement between
One Dot Six LLC and OP LLC has been assigned the file number listed below:1

File No. Lessee Lease ID Number
0006817249 One Dot Six LLC L000016369

Part 5 – Experimental Radio Service License

The following application for consent to the assignment of an experimental license from
LightSquared Sub DIP to LightSquared Sub has been assigned the file number listed below:

File No. Licensee Call Sign
0004-EX-AU-2015 LightSquared Subsidiary LLC, WH2XDX
Debtor-in-Possession

Part 63 – Domestic Section 214 Authority

The Applicants have filed an application for consent to the transfer of control of domestic section
214 authority from LightSquared Sub DIP to LightSquared Sub. LightSquared Sub DIP holds domestic
section 214 authority to provide interstate telecommunications services throughout the United States.

Part 63 – International Section 214 Authorizations

The following application for consent to the assignment of international section 214
authorizations from LightSquared Sub DIP to LightSquared Sub has been assigned the file number listed
below:

File No. Authorization Holder Authorization Number
ITC-ASG-20150406-00084 LightSquared Subsidiary LLC, ITC-214-19951215-00023
Debtor-in-Possession ITC-MOD-20120927-00246

1
Under the Wireless Telecommunications Bureau’s standard filing practice, this application was submitted as a new
de facto transfer lease application but is intended to reflect the assignment of the existing lease authority from One
Dot Six Corp., Debtor-in-Possession, to the reorganized One Dot Six LLC.

21

Federal Communications Commission FCC 15-164

STATEMENT OF
COMMISSIONER AJIT PAI,
APPROVING IN PART AND CONCURRING IN PART

Re: Applications of LightSquared Subsidiary LLC, Debtor-in-Possession, and LightSquared
Subsidiary LLC For Consent to Assign and Transfer Licenses and Other Authorizations and
Request for Declaratory Ruling on Foreign Ownership, IB Docket No. 15-126.

With this transaction, the LightSquared entities are on a path out of Chapter 11 bankruptcy, and
today’s decision will help move that process forward. With respect to one applicant, however, the
Commission is using a proxy agreement and deferring consideration of its character qualifications until
the agency receives additional information. In my view, we should be deciding in this Order whether
every applicant has the requisite qualifications to hold an FCC license. As a result, I am voting to concur
in this part of the decision.

Federal Communications Commission FCC 15-164

STATEMENT OF
COMMISSIONER MICHAEL O’RIELLY

Re: Applications of LightSquared Subsidiary LLC, Debtor-in-Possession, and LightSquared
Subsidiary LLC For Consent to Assign and Transfer Licenses and Other Authorizations and
Request for Declaratory Ruling on Foreign Ownership, IB Docket No. 15-126.

At the outset, it should be noted that I maintain a small investment in JPMorgan Chase & Co.
This was fully disclosed during my confirmation process and has been reported thereafter in annual
financial filings. After being alerted to JPMorgan Chase’s involvement by my personal staff, I sought out
the opinion of the ethics experts within the Commission’s Office of General Counsel to inquire about any
potential conflict of interest concerns. Upon review, it was determined that my holdings fall far below the
threshold to trigger any such issues. Only after this matter was resolved did I participate in this
proceeding or entertain any related meetings.

In terms of substance, the transfer of licenses from old LightSquared to the new entity allows for
the company to exit bankruptcy proceedings and offer services to the American people. The item appears
to properly handle pending non-communications-related legal actions by walling off those involved from
LightSquared’s decision-making process until the particular issues are fully resolved. Further, the foreign
ownership review seems consistent with past practices.

As the new LightSquared moves forward, it should be clear that I have no intent to revisit the
process circus that encircled the previous version of LightSquared. In particular, I will not be party to any
effort to undermine any legitimate protections afforded to the Global Positioning System and its
commercial users.

Document Created: 2015-12-04 14:35:35
Document Modified: 2015-12-04 14:35:35

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