The FCC denied a refund request from Hilliary Acquisition Corp 2016, LLC the company had on deposit for Auction 105, which involved bidding for Citizens Broadband Radio Service Priority Access Licenses in the 3550-3650 MHz band. Hilliary deposited more than $800,000 with the Commission, but defaulted on 42 winning bids, according to the agency.
Auction 105 closed in September 2020. Hilliary was the winning bidder for 42 Priority Access Licenses across 21 counties, with gross winning bids totaling $948,195. After applying its claimed 15 percent bidding credit as a rural service provider, Hilliary’s net winning bids amounted to $805,965.
After applying its upfront payment of $102,700 toward its down payment obligation, Hilliary was required to submit an additional $58,493 to the Commission by September 17, 2020. The FCC says Hilliary failed to make any payment by the deadline, thereby defaulting on its 42 winning bids.
The Commission rejected Hilliary’s argument that issuing a refund of its deposit would serve the public interest. The agency said the public interest is served instead by the Commission’s default payment methodology. “That methodology protects the integrity of the auction process by both helping the Commission ultimately to receive the full value of the winning bid amount through the deficiency payment and deterring defaults,” the FCC said in its decision.
Hilliary contends the public interest will be best served by returning its payments so that it can invest in broadband access. “This is unpersuasive because there is no guarantee that Hilliary will use the returned funds for this purpose or that such investment ultimately would further the public interest,” said the Commission.
The Auctions Division of the Office of Economics and Analytics and the Mobility Division of the Wireless Telecommunications Bureau assessed Hilliary an interim default payment of $161,193 and will assess a final default payment after license(s) for the covered spectrum receive winning bids in a future auction. The FCC says it’s holding onto Hilliary’s deposit “to ensure payment of Hilliary’s final default payment.”
By Leslie Stimson, Inside Towers Washington Bureau Chief
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