Dissenting Statement Of Commissioner Ajit Pai On Grain Waiver

The Federal Communications Commission jettisons this entire framework by waiving the attributable material relationship (AMR) rule -- for the benefit of Grain Management, a private equity firm that leases 100 percent of the spectrum capacity of all of its licenses to the two largest wireless carriers in the country. This decision cannot be justified under the FCC’s waiver law, since waiving the AMR rule here eviscerates -- rather than promotes -- the purpose of the rule.

The FCC’s suggestion that the rationale underlying the AMR rule does not apply when an applicant obtained its spectrum licenses without the benefit of bidding credits simply cannot be squared with either the text of the rule or the reasoning of the FCC decision that adopted it.

In addition, the FCC’s claim that Grain’s leasing agreements do not support any inference of undue influence flatly contradicts its determinations in the context of joint sales agreements among broadcast television stations.

Finally, the decision will likely produce anomalous results, inject needless uncertainty into the FCC’s auction process, and invite arbitrageurs to make creative end-runs around our AMR rules -- all of which is unnecessary given the upcoming DE rulemaking. For all these reasons, I dissent.