Kay v. FCC.

• Author: Pont, Brittany
• Position: Reconfiguring radio spectrum band

KAY V. FCC

621 F. App'x 5 (D.C. Cir. 2016)

In Kay v. FCC, (1) the United States Court of Appeals for the District of Columbia Circuit denied a petition from James A. Kay, Jr. challenging an FCC order to reconfigure the 800 MHz spectrum band in order to reduce interference with public safety communication systems. This case explores whether a petitioner maintains standing to challenge an FCC Order reconfiguring the 800 MHz spectrum when he is the sole member of a limited liability company holding such licenses. The D.C. Circuit found that he cannot assert this challenge.

1. BACKGROUND

   An 800 MHz radio system is a combination of conventional two-way radio and computer-controlled transmitters. (2) Police, firefighters, and other public safety officials use portions of the band for communications, which is comprised of spectrum at 806-824 MHz paired with spectrum at 851-869 MHz. (3) In order to combat harmful interferences on these systems, in 2004 the FCC set forth a plan to reconfigure the band. (4) The plan ordered certain licensees to move their operations to a different area of the spectrum. (5)

   Kay first petitioned the D.C. Circuit in 2006, when he personally held licenses that were affected by the FCC order. (6) In the present case, however, Kay acknowledges that he personally no longer holds any licenses. (7) Instead, he maintains "control and ultimate beneficial ownership" of Third District Enterprises (Third District), a Nevada limited liability corporation and licensee of 800 MHz licenses. (8) Kay asserts that his ownership of Third District provides him continued standing to bring this case in his personal capacity since he is the company's sole member. (9)

   The D.C. Circuit began by reminding the petitioner that a corporation is a separate and distinct legal entity from its shareholders, even if the corporation is solely owned. (10) Thus, a shareholder is generally unable to bring a personal lawsuit to "vindicate the rights of that separate legal entity." (11) Kay does not assert, nor does the court find, that he falls under any of the exceptions to this rule. (12) Thus, when Kay transferred his personal licenses to Third District, his claim became moot. (13) Additionally, the fact that Third District is a limited liability corporation, as opposed to a traditional corporation, does not alter the analysis; just as a corporation is a legally distinct entity from the corporate shareholders, a limited liability company is also legally...