UNITED STATES COURT OF APPEALS FOR THE D.C. CIRCUIT


QUALCOMM INC

v.

FCC


98-1246a

D.C. Cir. 1999


*	*	*


Rogers, Circuit Judge: In Freeman Engineering Associ- ates v. FCC, 103
F.3d 169 (D.C. Cir. 1997), the court held that  although the Federal
Communications Commission ("FCC")  could reasonably interpret its
rules for awarding pioneer's  preferences to mean that adaptations of
technology are not  innovative, it had not applied the interpretation
equally  among all preference applicants to QUALCOMM's detriment.  See
id. at 180. The court granted QUALCOMM's petition for  review, vacated
that part of the FCC's decision denying  QUALCOMM's preference
request, and remanded "for fur- ther proceedings to remedy this
inconsistency." Id. Before  the FCC granted such a remedy, but after
the court's man- date issued in Freeman Engineering, Congress advanced
the  sunset date for the FCC's authority to award pioneer's pref-
erences and the FCC dismissed all pending preference appli- cations,
including QUALCOMM's. We grant QUALCOMM's  petition for review of this
dismissal because the FCC misin- terpreted Freeman Engineering as
ordering no more than a  general remand for further proceedings, and
thereby misap- plied the sunset provision withdrawing its authority to
award  new pioneer's preferences to a final judgment that entitled 
QUALCOMM to a pioneer's preference under the rules then  in effect.


I.


The background for this appeal is set forth in Freeman  Engineering,
and therefore we summarize only four relevant  areas. First, the FCC
promulgated the pioneer's preference  rules in 1991 in an effort "to
reduce the risk and uncertainty  innovating parties face in our
existing rulemaking and licens- ing procedures, and therefore to
encourage the development  of new services and new technologies."
Establishment of  Procedures to Provide a Preference to Applicants
Proposing  an Allocation for New Services, 6 F.C.C.R. 3488, 3492
(1991)  ("Pioneer's Preference Order"). Thus, an applicant demon-
strating "that it (or its predecessor-in-interest) has developed  an
innovative proposal that leads to the establishment of a  service not
currently provided or a substantial enhancement  of an existing
service," id. at 3494, would "effectively ... [be]  guarantee[d] ... a
license in the new service (assuming it is  otherwise qualified) by
permitting the recipient of a pioneer's  preference to file a license
application without being subject  to competing applications." Id. at
3492; see also 47 C.F.R.  s 1.402(a) (1995); Adams Telcom, Inc. v.


Second, QUALCOMM applied for a pioneer's preference,  the FCC denied
it, and on appeal QUALCOMM prevailed.  QUALCOMM requested a pioneer's
preference for a license  in the Southern Florida Major Trading Area
("MTA") based  on technology developed for use in broadband (2 GHz)
per- sonal communications services ("PCS"). See Request for a 
Pioneer's Preference for a Personal Communications Ser- vices System,
Gen. Docket 90-314 (May 4, 1992). In 1992,  the FCC tentatively
granted three pioneer's preferences--to  American Personal
Communications ("APC"), Cox Enterpris- es, Inc. ("Cox"), and Omnipoint
Communications, Inc. ("Omni- point")--and dismissed the remaining
applications. See  Amendment of the Commission's Rules to Establish
New  Personal Communications Services: Tentative Decision and 
Memorandum Opinion and Order, 7 F.C.C.R. 7794, 7797- 7809 (1992)
("Tentative Decision"). The FCC explained in  rejecting QUALCOMM's
application that its proposed tech- nology was "essentially ...


... developed for use in the 800 MHz cellular bands." Id. at  7807. In
1994, the FCC affirmed its decision granting prefer- ences to APC,
Cox, and Omnipoint, and denying  QUALCOMM a preference because its
work was merely an  adaptation of previously developed technology. See
Amend- ment of the Commission's Rules to Establish New Personal 
Communications Services: Third Report and Order, 9  F.C.C.R. 1337,
1339-48, 1368-70 (1994) ("Third Report and  Order"). After the FCC
denied its petition for reconsidera- tion, see Amendment of the
Commission's Rules to Establish  New Personal Communications Services:
Memorandum  Opinion and Order, 9 F.C.C.R. 7805, 7810-11 (1994)
("Recon- sideration Order"), QUALCOMM petitioned for review by  this


On appeal, the court vacated that part of the FCC's deci- sion denying
QUALCOMM's preference application, conclud- ing that although the FCC
could reasonably interpret its  pioneer's preference rules to mean
that adaptation of technol- ogy was not innovative, it could not
discriminate among  preference applicants in applying its rules. See
Freeman  Eng'g, 103 F.3d at 178-80. Because Omnipoint had also  based
its 2 GHz application on technology adapted from work  it had done on
900 MHz cellular bands tested at 900 MHz, in  part prior to the
promulgation of the pioneer's preference  rules, the court concluded
that the FCC had acted arbitrarily  and capriciously in denying
QUALCOMM's application on the  ground that its "proposed technology
was a non-innovative  adaptation" because it " 'ha[d] been developing
its ... tech- nology since 1985' and had 'validated [it] for 800 MHz.'
" Id.  at 180 (quoting Reconsideration Order, 9 F.C.C.R. at 7811). 
The court noted that although "[n]umerous parties to the  FCC
proceedings pointed out this disparate treatment to the  Commission,"
the FCC had responded not by applying the  "developed specifically for
a particular service" test applied to  QUALCOMM, but by reverting to
the "associated with" test,  noting that " 'Omnipoint has demonstrated
that it performed  significant new work related to 2 GHz PCS after
adoption of  the pioneer's preference rules.' " Id. (quoting Third
Report  and Order, 9 F.C.C.R. at 1346). Yet, the court noted, the 
same could be said of QUALCOMM: its "adaptation was also 


'significant new work related to 2 GHz PCS.' " Id. Conclud- ing that
the FCC "applied a newly developed (and questiona- ble) interpretation
of its pioneer's preference rules" only to  QUALCOMM, the court
observed that "[w]ere this case  remanded, it is not at all clear
whether the Commission would  continue to adhere to this
interpretation of the pioneer's  preference rules." Id. The court's
disposition in granting  QUALCOMM's petition read:


[W]e find reasonable the Commission's interpretation of  the pioneer's
preference rules such that adaptations of  technology are not
innovative and thus not deserving of a  preference. However, we
conclude that the Commission  failed to apply this interpretation
consistently to the  detriment of QUALCOMM's application for a
preference.  We therefore vacate that portion of the Commission's 
decision denying QUALCOMM's preference request.  We remand for further
proceedings to remedy this incon- sistency.


Id. The court's mandate issued April 18, 1997.


Third, Congress changed the landscape of the pioneer's  preference
program in two ways relevant here, the first  occurring before the
court issued its mandate, and the second  occurring after. As to
auctions, before the court's mandate,  Congress authorized the FCC in
1993 to auction licenses for  radio spectrum. See Omnibus Budget
Reconciliation Act of  1993, Pub. L. No. 103-66, s 6002, 107 Stat.
312, 387-392  (codified at 47 U.S.C. s 309(j)(1)-(12) (1994)); see
also  Amendment of the Commission's Rules to Establish New  Personal
Communications Services: Second Report & Order,  8 F.C.C.R. 7700,
7707-09 (1993). One of the auctions resulted  in the issuance of a
license for the area sought by  QUALCOMM, the Miami-Fort Lauderdale
MTA, to PrimeCo  Personal Communications and Sprint Spectrum,


In addition, Congress precluded review of granted prefer- ences and
established a sunset date for the FCC's authority  to grant
preferences. After the first auction for narrowband 


PCS generated over $650 million,1 see FCC Report to Con- gress on
Spectrum Auctions, FCC 97-353 at 10 (Sept. 30,  1997), and in view of
the fact that "pioneers" received the  license of their choice without
payment, Congress amended  the Communications Act in 1994 to require
the FCC to  "recover for the public a portion of the value of the
public  spectrum resource" from pioneers, with provisions for install-
ment payments over a five year period. Uruguay Round  Agreements Act,
Pub. L. No. 103-465, s 801, 108 Stat. 4809,  5050-51 ("GATT")
(codified at 47 U.S.C. s 309(j)(13) (B) &  (C) (1994)); see also H.R.
Rep. No. 103-826, pt. 2, at 26  (1994). Congress also directed the FCC
to award licenses  within fifteen days to those granted preferences in
the Third  Report and Order (namely, APC, Cox, and Omnipoint) and 
prohibited further agency or judicial review of those prefer- ences
and licenses. See GATT, 108 Stat. at 5051 (codified at  47 U.S.C. s
309(j)(13)(E)(i)). Further, Congress added a  sunset provision,
terminating the FCC's authority to grant  pioneer's preferences after
September 30, 1998. See id. at  5052 (codified at 47 U.S.C. s
309(j)(13)(F)). After the court  issued its mandate, Congress advanced
the sunset date from  September 1998 to August 5, 1997. See Balanced
Budget Act  of 1997, Pub. L. No. 105-33, s 3002(a)(1)(F), 111 Stat.
251,  259 (1997) (amending 47 U.S.C. s 309(j)(13)(F)).


Fourth, on remand, despite QUALCOMM's urging of the  FCC to comply with
47 U.S.C. s 402(h),2 by "forthwith" 




__________

n 1 As of September 30, 1997, winning net bids in FCC spectrum 
auctions totaled almost $23 billion. See FCC Report to Congress on 
Spectrum Auctions, FCC 97-353 at 10-11 (Sept. 30, 1997).


2 Section 402(h) provides:


In the event that the court shall render a decision and enter an  order
reversing the order of the Commission, it shall remand  the case to
the Commission to carry out the judgment of the  court and it shall be
the duty of the Commission, in the absence  of the proceedings to
review such judgment, to forthwith give  effect thereto, and unless
otherwise ordered by the court, to do  so upon the basis of the
proceedings already had and the  record upon which said appeal was
heard and determined.


granting it a pioneer's preference, the FCC reopened the  proceedings
for comment on QUALCOMM's application and  ultimately dismissed
QUALCOMM's application for lack of  power to act. From the start of
the remand proceedings,  QUALCOMM sought prompt agency action to
implement  Freeman Engineering. In responding to a February 25,  1997,
request of the General Counsel and the Office of  Engineering and
Technology ("OET"), QUALCOMM summa- rized their meeting on January 31,
1997, (24 days after the  court issued its decision in Freeman
Engineering and almost  three months before the mandate issued on
April 18, 1997),  when QUALCOMM advised that it sought a preference
for its  pioneering work and emphasized the need for a quick award  to
minimize prejudice to QUALCOMM in the marketplace.  At that meeting
QUALCOMM also advised that it was willing  to work with the FCC on
alternative remedies that did not  require rescission of Sprint's
Miami license, referring specifi- cally to available C Block Basic
Trading Area ("BTA") licens- es and the Phoenix BTA. In response to
OET's February 18,  1997, notice announcing a filing period for
comments on  QUALCOMM's preference application, see Public Notice DA 
97-351, 12 F.C.C.R. 2364 (1997), PrimeCo and Sprint submit- ted
comments on March 20, 1997, recommending that, assum- ing the FCC
found that QUALCOMM was entitled to a  preference, it award QUALCOMM a
license for alternative  spectrum.3 QUALCOMM in its comments stated
that under  Freeman Engineering, it was entitled to be treated in the 
same manner as Omnipoint and, thus, to have its preference  granted.




__________

n 47 U.S.C. s 402(h).


3 QUALCOMM objected to reopening the proceeding on the  grounds that
(1) three years had passed since the FCC denied  QUALCOMM's
preference, (2) the court's vacation and remand  were narrow,
requiring no further factual development, and (3) the  FCC's
obligation under s 402(h) did not contemplate reopening the 
proceeding. The FCC nonetheless reopened the proceeding and  made
Sprint and PrimeCo parties. See QUALCOMM Inc., Request  for Pioneer's
Preference, Public Notice DA 97-423, 12 F.C.C.R.  2417 (1997).


On April 15, 1997, OET advised QUALCOMM that it was  "actively working"
on the remand and that FCC "action  c[ould] be anticipated 'by
summer.' "4 On May 27, 1998,  QUALCOMM wrote directly to the Chairman
of the FCC  that it "should grant QUALCOMM's preference application 
promptly, with the understanding that" while "the substantive 
decision is foreordained by the record, ... we recognize that 
implementation of the decision has certain practical ramifica- tions,"
and that "QUALCOMM is willing to discuss substitu- tion of presently
unlicenced service areas of comparable  significance [to the MTA in


On September 11, 1997, the FCC dismissed all pending  pioneer's
preference applications, including QUALCOMM's,  on the ground that the
Balanced Budget Act of 1997 with- drew the FCC's authority to grant
any preferences. See  Dismissal of All Pending Pioneer's Preference
Requests, 12  F.C.C.R. 14006, 14007 (1997) ("Dismissal Order"). As to 
QUALCOMM, the FCC noted that although the court had  vacated the
denial of QUALCOMM's preference request and  "remanded to the
Commission for further consideration ...  [it] no longer ha[d]
authority to act on it." Id. at 14008 n.10.


The court denied QUALCOMM's motion to enforce the  mandate in Freeman
Engineering for lack of exhaustion  because its petition for
reconsideration was pending before  the FCC. See Freeman Eng'g Assocs.
v. FCC, No. 94-1779  (D.C. Cir. Nov. 5, 1997). Having been denied
reconsidera- tion, see Dismissal of All Pending Pioneer's Preference
Re- quests, 13 F.C.C.R. 11485 (1998) ("Reconsideration Order"), 
QUALCOMM now appeals the FCC's Dismissal and Recon- sideration Orders
of September 11, 1997, and April 23, 1998,  respectively.




__________

n 4 QUALCOMM had requested a meeting with OET after read- ing a quote
in the April 7 issue of Wireless World from an FCC  staff member that
resolution of the matter could take "a year or  two." See Letter from
Richard M. Smith, Chief of OET, to  Veronica M. Ahern, Counsel for
QUALCOMM (Apr. 15, 1997).


II.


Under Chevron, the court must first determine "whether  Congress has
directly spoken to the precise question at  issue." Chevron, U.S.A.,
Inc. v. Natural Resources Defense  Council, Inc., 467 U.S. 837, 842
(1984). "If the intent of  Congress is clear, that is the end of the
matter; for the court,  as well as the agency, must give effect to the
unambiguously  expressed intent of Congress." Id. at 842-43. There is
no  dispute here that the Budget Act of 1997 terminated the  FCC's
authority, effective August 5, 1997, to grant pioneer's  preferences.
Because the statute is silent, however, with  respect to QUALCOMM's
situation, the question is whether  the FCC properly interpreted the
sunset provision to apply to  QUALCOMM's application; in other words,
the question is  whether Congress intended its withdrawal of the FCC's
 authority to grant pioneer's preferences to foreclose the FCC  from
carrying out the mandate of a final judicial decision.  See id. at


Rejecting QUALCOMM's contentions of entitlement aris- ing from the
court's mandate, the FCC maintains that its  interpretation of the
sunset provision is entitled to deference  under Chevron, id. at
842-45 (1984), because Congress unam- biguously intended to extinguish
the FCC's authority to grant  pioneer's preferences after August 5,
1997. In the FCC's  view, QUALCOMM's application was no different from
the  other pending applications inasmuch as the court in Freeman 
Engineering had "simply directed the FCC to reconsider  whether
QUALCOMM was entitled to the same sort of  pioneer's preference that
Omnipoint received--an opportunity  to obtain a broadband PCS license
without having to face  competing applications" and it was "required
... only to  consider whether QUALCOMM was entitled to the pioneer's 
preference for which it applied." Respondents' Brief at 24,  26.


Although a court will generally defer to an agency's reason- able
interpretation of a statute, the effect of such deference  here would
be to make retroactive a statute that does not  expressly call for it,
see Landgraf v. USI Film Prod., Inc.,  511 U.S. 244 (1994), and to
pose a constitutional question of 


whether Congress could change the result of a final judicial  decision,
see Plaut v. Spendthrift Farm, Inc., 514 U.S. 211,  240 (1995). While
we agree with the FCC that the sunset  provision extinguished its
authority to grant preferences, we  disagree that it applied to
QUALCOMM's application. The  mandate in Freeman Engineering provided
the FCC with the  authority it required to carry out the court's
instruction to  "remedy this inconsistency" by granting QUALCOMM a 
pioneer's preference and awarding a license for a suitable  spectrum.
The court had subject matter jurisdiction and  ordered a remedy that
was within its discretion. We hold,  therefore, that the sunset
provision did not extinguish  QUALCOMM's entitlement to a preference,
much less the  FCC's authority and duty to provide a remedy for 
QUALCOMM under the mandate in Freeman Engineering.  Accordingly, we
grant QUALCOMM's petition and remand  for the FCC "forthwith" to grant
QUALCOMM a pioneer's  preference and to identify and award an
appropriate license  to it, commensurate with the spectrum it had


A.


The only plausible reading of Freeman Engineering re- quired the FCC to
grant QUALCOMM a pioneer's preference  under either of two theories.
First, the FCC could abandon  the "newly developed" and "questionable"
interpretation of its  pioneer's preference rules that it had applied
to  QUALCOMM and award QUALCOMM a preference under  the same
interpretation of the rules that permitted the award  of a preference
to Omnipoint. Freeman Eng'g, 103 F.3d at  180. Second, the FCC could
adhere to its newly developed  interpretation, but it still had to
award QUALCOMM a  preference "to remedy th[e] inconsistency" in its
treatment of  two similarly situated applicants, QUALCOMM and Omni-
point. Id. As the FCC made clear in its brief in Freeman  Engineering,
Congress had precluded reconsideration of the  awards to the three
original preference recipients, including  Omnipoint. See 47 U.S.C. s
309(j)(13)(E)(i); Respondents'  Brief in Freeman Engineering at 18, 54


Contrary to its apparent assumption, the FCC had no  discretion on
remand to reevaluate QUALCOMM's applica- tion; it had previously
ruled, explaining its reasons for deny- ing QUALCOMM a pioneer's
preference, and it had reaffirm- ed its ruling and reasoning on
reconsideration. The court  nonetheless agreed with QUALCOMM's claim
of discrimina- tory treatment and on remand did not accord to the FCC 
another bite at the explanation apple. In Freeman Engineer- ing, the
FCC did not raise the possibility of further evalua- tion on remand in
its brief on appeal. Nor did the FCC have  discretion on remand to
show that there was no inconsistency  because Omnipoint satisfied the
pioneer's preference rules as  newly interpreted and applied to
QUALCOMM; this argu- ment was raised and rejected in Freeman
Engineering, 103  F.3d at 180. Although the FCC did maintain that if 
QUALCOMM and Omnipoint were similarly situated, then  the FCC would
have been required to deny both applications,  see Respondents' Brief
in Freeman Engineering at 54, nei- ther the FCC nor QUALCOMM claimed
that Omnipoint was  not entitled to a pioneer's preference under the
FCC's rules.  See id.; Petitioners' Reply Brief at 23.


The FCC's sole discretion on remand, therefore, was to  fashion an
appropriate remedy for QUALCOMM in view of  the fact that the
Miami-Fort Lauderdale MTA sought by  QUALCOMM had been awarded as a
result of an auction to  Sprint. QUALCOMM and the intervenors argued
on re- mand, and the FCC did not claim to the contrary, that the  FCC
had authority to grant QUALCOMM alternative relief.  QUALCOMM
repeatedly indicated its willingness to accept  relief comparable to
the original license sought in its prefer- ence application,
suggesting several specific alternatives. Ac- cording to the FCC at
oral argument, this could have been  technically achieved by allowing
QUALCOMM to amend its  application, and at that point, the FCC could
have awarded  the pioneer's preference. Even if the identification of
an  appropriate alternative spectrum could not be accomplished 
"forthwith"--a claim the FCC does not make--  QUALCOMM's May 1997
letter to the FCC chairman made  clear that the grant of a pioneer's


a license were not inseparable: the FCC could formally grant  QUALCOMM
a pioneer's preference based on the work  identified in its preference
application and award a license for  a specific spectrum at a later
time. Indeed, to the extent that  the FCC did not dispute QUALCOMM's
recitation of its  January 31, 1997 meeting, the FCC initially
appeared to be  proceeding on remand to craft a remedy, but somehow
be- came diverted when, contrary to s 402(h), it reopened the 
proceedings, over QUALCOMM's objection, issuing a public  notice for
comment and joining the intervenors as parties.


The FCC's contention that the mandate in Freeman Engi- neering was not
to grant QUALCOMM a pioneer's prefer- ence per se because the language
of the court's opinion was  rather vague, remanding for "further
proceedings," which the  FCC has now interpreted to give it greater
remedial discre- tion, reveals its misunderstanding of the mandate.
The FCC  chooses to focus on only the first part of the court's
express  and pointed instruction to the FCC in Freeman Engineering. 
The court did not remand generally for "further proceed- ings," but
rather for "further proceedings to remedy this  inconsistency."
Freeman Eng'g, 103 F.3d at 180. By noting  the similarities between
QUALCOMM's and Omnipoint's ap- plications, and the FCC's unpersuasive
attempts to distin- guish them during administrative proceedings and
on appeal,  the court made clear that it was not remanding for a
better  explanation from the FCC of its denial of QUALCOMM's 
application, but rather had rejected the FCC's explanations  and
instead ordered concrete relief for QUALCOMM. In  addition, the FCC
chooses to ignore the effect of its own brief  in Freeman Engineering,
which had pointed out that  QUALCOMM's application could not be
granted for the origi- nal license that it sought because that license
had been  awarded in auction. See Respondents' Brief in Freeman 
Engineering at 20. Hence, the court recognized that alterna- tive
relief remained to be identified and that a remand for  "further
proceedings" for that purpose was required. While  all of this appears


FCC has chosen to ignore both the instructions of the court  and the
requirements of s 402(h).


In short, the FCC misinterpreted the mandate in Freeman  Engineering to
assign it more than a ministerial role with  regard to the grant of a
pioneer's preference to  QUALCOMM. The remand in Freeman Engineering
was  not simply "for further proceedings," but to afford  QUALCOMM a
remedy in view of the FCC's inconsistent  treatment of it, and that
remedy--given the statutory con- text--meant that QUALCOMM was
entitled to a pioneer's  preference. Although the court might have
been more explic- it, its instruction to the FCC to "remedy this
inconsistency"  was unusual language and clear in the context of a
complex  administrative appeal in which QUALCOMM alone, out of  many
petitioners, prevailed and where Congress had barred  the FCC from
rescinding Omnipoint's preference.


B.


Had the FCC acted "forthwith" in accordance with the  Freeman
Engineering mandate, QUALCOMM would have  been granted its pioneer's
preference before Congress ad- vanced the sunset date in the 1997
Budget Act. By extending  the remand proceeding, however, the FCC
created a need to  interpret the new sunset provision, which it read
to relieve  itself of the duty to carry out the mandate issued more
than  four months previously. This interpretation of Congress' 
withdrawal of the FCC's authority to award new pioneer's  preferences
is flawed for several reasons.


First, the statute is silent on whether it applies retroactive- ly to
divest QUALCOMM of the fruits of its victory in court.  QUALCOMM's
application was different than other pending  applications before the
FCC. For the other numerous pend- ing applications, of course, the
mere filing of a license applica- tion did not give the applicant a
vested right to consideration 


under then-prevailing standards, see Hispanic Info. & Tele- comm.
Network v. FCC, 865 F.2d 1289, 1294-95 (D.C. Cir.  1989), and the FCC
retained discretion to change the stan- dards during the course of
proceedings. See Melcher v. FCC,  134 F.3d 1143, 1164 (D.C. Cir.
1998); Chadmoore Communi- cations, Inc. v. FCC, 113 F.3d 235, 241
(D.C. Cir. 1997).  QUALCOMM, however, had prevailed on appeal and
obtained  an express judicial instruction to the FCC that was more
than  a mere opportunity for the FCC to reevaluate its application. 
To view the relief that QUALCOMM had obtained in Free- man Engineering
as extinguished by a later-enacted sunset  provision would contravene
Supreme Court doctrine govern- ing interpretation of potentially
retroactive statutes. As  Landgraf and similar authority make clear,
absent an express  statement that a statute will apply to events
preceding its  enactment, it may not be interpreted to impair rights a
party  possessed when Congress acted. See Landgraf, 511 U.S. at  280;
see also Martin v. Hadix, No. 98-262, 1999 WL 401324  (S. Ct. June 21,
1999); Lindh v. Murphy, 521 U.S. 320, 324- 26 (1997). Congress gave no
such express command in either  the 1994 or 1997 sunset provisions.
Consequently, because  QUALCOMM's preference application was not
simply a pend- ing application as to which no vested entitlement had
at- tached, the FCC could not properly interpret the sunset  provision
to extinguish QUALCOMM's entitlement to a pref- erence under Freeman


Second, the FCC mistakenly conflated the sunset of its  authority to
issue new pioneer's preferences and its continu- ing obligation under
the mandate in Freeman Engineering to  "remedy this inconsistency." In
the FCC's view, until it  acted to grant QUALCOMM a pioneer's
preference on re- mand, QUALCOMM had no right to one, and once
Congress  eliminated the FCC's authority to grant such preferences,
the  FCC was without authority to act in accordance with the  mandate
of this court. This position overlooks the fact that  Congress amended
the Communications Act to add subsection  (h) to s 402 so that the
court would remain in control of the 


remand and the FCC could not deprive a victor in the courts  of the
spoils of its victory. See S. Rep. No. 82-44, at 12  (1951); Greater
Boston Television Corp. v. FCC, 463 F.2d  268, 281-82 (D.C. Cir.
1971). As explained in the Senate  Report, subsection (h) was
"intended to confer upon the  appellate court a measure of control
commensurate with the  dignity and responsibility of that tribunal."
S. Rep. No.  82-44, at 12 (1951). In Greater Boston Television
Corpora- tion, the court viewed subsection (h) as designed to "ensure 
deference to the court's intention in its disposition...." 463  F.2d
at 281-82. Accordingly, on remand, the FCC had "the  duty" to give
immediate and effective relief to QUALCOMM  consistent with Freeman


The FCC's contrary interpretation ignores settled law that  the mandate
of a court issuing a final judgment carries force  beyond a victory in
that immediate court. The "action[s] of a  court in setting aside the
order of the Commission [are not]  an empty gesture," but rather a
judgment that is the "final  and indisputable basis of action as
between the Commission  and the defendant." FPC v. Pacific Power &
Light Co., 307  U.S. 156, 160 (1939) (internal quotation omitted); see
also  International Union of Mine, Mill & Smelter Workers v. 
Eagle-Picher Mining & Smelting Co., 325 U.S. 335, 340-41  (1945).
Thus, the court's mandate obliged the FCC to award  QUALCOMM a
pioneer's preference with such spectrum  adjustment as was
necessitated by the GATT provision bar- ring the reconsideration or
withdrawal of granted prefer- ences, see 47 U.S.C. s 309(j)(13)(E)(i),
and the award of the  original spectrum sought by QUALCOMM to another
entity.  Cf. Mefford v. Gardner, 383 F.2d 748, 758 (6th Cir. 1967). 
The fact that Congress in the interim extinguished the FCC's 
authority to award pioneer's preferences is of no consequence  because
s 402(h) provided the FCC with an independent  source of authority to
implement the mandate of a court  acting within its jurisdiction and


Third, the FCC's interpretation of the sunset provision  raises
constitutional concerns under Plaut v. Spendthrift  Farm, warranting
application of the canon of constitutional 


doubt, which states that ambiguous statutes should not be  read to
raise a serious constitutional question when a reason- able and
clearly constitutional alternative is available. See,  e.g., Jones v.
United States, 119 S. Ct. 1215, 1222 (1999). In  Plaut, the Supreme
Court surveyed the legal history underly- ing the now settled
proposition that a final judgment of a  court cannot be undone by
congressional legislation as to the  parties before the court. 514
U.S. at 219-225.5 Distinguish- ing the rule that changes in statutory
law occurring during  the pendency of litigation generally must be
applied to that  litigation, see United States v. Schooner Peggy, 5
U.S. (1  Cranch) 103, 110 (1801), the Supreme Court instructed in 
Plaut that the separation of powers doctrine embedded in the 
Constitution protects the final judgment of Article III courts  from
legislative interference.6 Plaut, 514 U.S. at 226. Start- ing from the
premise that Article III establishes a "judicial 




__________

n 5 Plaut concerned Congress' extension of the statute of limita- tions
in civil actions to enforce the federal securities laws. In 1987, 
Plaut filed a securities fraud action seeking damages for alleged 
violations in 1983 and 1984. See Plaut, 514 U.S. at 213. While the 
lawsuit was pending, however, the Supreme Court held in Lampf,  Pleva,
Lipkind, Prupis & Petigrow v. Gilbertson, 501 U.S. 350  (1991), that
such actions had to be commenced within one year after  the discovery
of the facts constituting the violation and within three  years after
the violation. See id. at 364. Applying Lampf, the  district court in
1991 dismissed Plaut's complaint with prejudice as  untimely filed;
the judgment became final 30 days later. Respond- ing to Lampf, and
after the dismissal order in Plaut become final,  Congress enacted a
statute purporting to reinstate the lawsuits  dismissed by reason of
Lampf that would have been timely under  the prior limitations period.
See Plaut, 514 U.S. at 214. Because  the dismissal of Plaut's
complaint had become final before a new  statute that would have
precluded dismissal went into effect, the  Court held that Congress
had exceeded its authority. See id. at  217-18.


6 Thomas v. Network Solutions, 176 F.3d 500, 506 n.9 (D.C.  Cir. 1999),
does not suggest anything to the contrary. The judg- ment of the
district court in that case was pending on appeal and  therefore not
final when Congress enacted the statute at issue.


department" with the "province and duty ... to say what the  law is,"
Marbury v. Madison, 5 U.S. (1 Cranch) 137, 177  (1803), the Court
concluded that the historical record "shows  that the Framers crafted
this charter of the judicial depart- ment with an expressed
understanding that it gives the  Federal Judiciary the power, not
merely to rule on cases, but  to decide them, subject to review only
by" superior Article III  courts. Plaut, 514 U.S. at 218-19; see The
Federalist No.  81, at 545 (Alexander Hamilton) (J. Cooke ed. 1961).
By  passing retroactive legislation affecting a case already finally 
adjudicated, Congress had circumvented the fundamental  principle that
the judicial power includes the authority to  render dispositive
judgments, and had thus violated the prin- ciple of separation of
powers. See Plaut, 514 U.S. at 219.7


The fact that the sunset provision, unlike the statute invali- dated in
Plaut, was not by its terms directed specifically at a  particular
disfavored judicial decision is irrelevant; the Su- preme Court
explained in Plaut that Congress' use of more  generally applicable
terms does not alter the separation of  powers analysis. See 514 U.S.
at 228. The sunset of the  FCC's preference authority did nothing to
deprive the FCC  of the intellectual, staffing, or resource capability




__________

n 7 A final judgment for purposes of separation of powers does  not
include all forms of judgment by the courts. As stated in Plaut,  a
judgment at law is generally immune to subsequent legislative 
changes, and an attempt by Congress to alter the legal judgment of  a
court implicates separation of powers principles. A judgment 
providing prospective equitable relief, however, remains vulnerable 
to subsequent legislative action that accordingly would not raise the 
same separation of powers concerns. See Plaut, 514 U.S. at 232; 
Pennsylvania v. Wheeling & Belmont Bridge Co., 59 U.S. (18 How.)  421,
431 (1855); see also System Fed'n No. 91 v. Wright, 364 U.S.  642,
649-52 (1961); BellSouth Corp. v. FCC, 162 F.3d 678, 692-93  (D.C.
Cir. 1998). The mandate in Freeman Engineering to remedy  the FCC's
prior inconsistent treatment of QUALCOMM and Omni- point, and thereby
grant QUALCOMM a pioneer's preference, was  a final judgment entitling
QUALCOMM to a preference, not a  judgment with prospective effects
subject to evolving conduct or  conditions.


appropriate action in QUALCOMM's favor. Nor does the  FCC suggest a
lack of capability. Pursuant to the remand in  Freeman Engineering,
then, despite intervening congression- al action taking away its own
authority, the FCC was obligat- ed to act pursuant to the authority of
the court. Had  Congress expressly commanded what the FCC contends it 
meant by its silence, the court would be forced to decide  whether
Congress acted constitutionally in light of Plaut.  However, the
sunset provision can reasonably be read not to  bar relief for
QUALCOMM, and it should be so read to avoid  imputing to Congress the
rare8 intent to undo a final judicial  mandate and the constitutional
questions that such an intent  would raise.9




__________

n 8 Until Plaut, the Supreme Court was unaware of any "instance  in
which Congress has attempted to set aside the final judgment of  an
Article III court by retroactive legislation." Plaut, 514 U.S. at 
230. In light of this historical pattern, and as with retroactive 
legislation generally, see Landgraf, 511 U.S. at 277-80, the court 
will not read a statute retroactively to alter a final judgement 
absent an express statement of intent.


9 Saco River Cellular, Inc. v. FCC, 133 F.3d 25 (D.C. Cir. 1998),  is
not to the contrary. In that case, the mandate called for a  remand to
afford the FCC an opportunity to provide a better  explanation for its
waiver of a financial reporting requirement. See  Northeast Cellular
Tel. Co. v. FCC, 897 F.2d 1164, 1167 (D.C. Cir.  1990). Hence, the
FCC's subsequent decision to award a license to  a different applicant
stemmed from its own reconsideration of the  case rather than a
judicial order compelling a specific result. The  direction to "remedy
this inconsistency" in Freeman Engineering is  not comparable; it
afforded the FCC no opportunity to develop  better reasons for denying
QUALCOMM's application, much less to  reevaluate QUALCOMM's
application. Rather, the court's instruc- tion was clear from context:
both Omnipoint and QUALCOMM had  sought preferences on the basis of
technological modifications on  which work had commenced before the
FCC had promulgated its  pioneer's preference rules. Yet the FCC had
denied QUALCOMM  a preference on this basis while granting Omnipoint a
preference,  and Congress had barred the FCC from rescinding
Omnipoint's  preference. While the court afforded the FCC the
opportunity to  reevaluate its interpretation of its rules--either to


Fourth, the legislative history is consistent with our inter- pretation
of the sunset provision inasmuch as Congress  sought to protect
settled expectations. When Congress in  1994 set the date for
withdrawal of the FCC's authority to  grant new pioneer's preferences,
its focus was on increasing  federal revenues and not upsetting
settled expectations. It  imposed a new requirement that pioneers pay
for part of the  value of the spectrum they received, and it added a
sunset  provision ending the FCC's authority to grant pioneer's pref-
erences. Significantly for our purposes, Congress also direct- ed the
FCC not to reconsider the pioneer's preference grants  that it had
approved in the Third Report and Order and not  to delay by more than
15 days the issuance of licenses based  on such grants; it also
prohibited any further administrative  or judicial review of the
preferences that had already been  granted. See 47 U.S.C. s
309(j)(13)(E))(i). In so doing,  Congress made clear its intent not to
undo the settled expec- tations of APC, Cox, and Omnipoint based on
final agency  action granting their pioneer's preferences. There is
nothing  in the legislative history to suggest that Congress neverthe-
less intended to interfere with settled expectations derived  from a
final judicial mandate directing agency action. The  House Report
expressly stated that the provision finalizing  the grants in the
Third Report and Order was not intended to  "affect the rights of
persons who have been denied a pioneer's  preference," such as
QUALCOMM; those persons could still  pursue further administrative and
judicial review of the denial  of their applications. H.R. Rep. No.
103-826, pt. 2, at 8  (1994). So too, nothing suggests that when
Congress ad- vanced the sunset date in 1997, it intended to upset
settled  expectations much less undo the vested rights of an applicant




__________

n "newly developed" and "questionable" interpretation of its prefer-
ence rules that it applied only to QUALCOMM or retain that 
interpretation--it required in any event that the FCC grant  QUALCOMM
a preference. No such relief was obtained by the  prevailing party in


erence under a judicial mandate with which the FCC was  obliged to
comply under s 402(h).


Accordingly, we grant QUALCOMM's petition and remand  to the FCC
"forthwith" to grant a pioneer's preference to  QUALCOMM and to take
prompt action to identify a suitable  spectrum and award QUALCOMM the
license for it.