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In a pre-holiday late-nighter, a Fulton County, Ga., superior court jury deliberated until 1 a.m. Dec. 23 before settling a costly dispute over a broadband communications license. Deliberations began the afternoon of Dec. 22 and continued into the wee hours of the next morning before the jury handed down a decision. It found that American Wireless License Group must abide by an earlier agreement to sell a 30-megahertz broadband communications license for Honolulu to Pacific Communications. The jury’s ruling was general, specifying only that American must sell the license to Pacific Communications for $13.5 million — the sum Pacific says the company had agreed to accept in 1999. But the value of the award may be much higher than that. Bidding in a current auction for a 10-megahertz license in Honolulu has now topped $50,770,000. The value of the 30 megahertz license, then, would reach more than $150 million. Pacific Communications v. American Wireless, No. 2000CV20099 (Fult. Super., filed March 1, 2000). Pacific Communications’ lawyer Kirk W. Watkins, a partner with Womble Carlyle Sandridge & Rice in Atlanta, says Fulton Superior Court Judge Constance C. Russell did her best to try to give the parties and the jurors a rest, but the jury wouldn’t hear of it. “The judge kept asking them, did any of them want to stop for the day or did any of the parties want to stop, but they said they wanted to keep going,” Watkins says. MAIN ISSUES The main issues in the case, according to a pretrial order, were whether Pacific and American Wireless had an agreement for the purchase of the license, and whether American violated that agreement. American bought the 30-megahertz license for mobile-phone use in Honolulu at an April 1999 auction. That fall the company rejected offers from both Pacific and another company, Hawaiian Wireless, to buy the 10-megahertz license for $7.4 million. But that winter, the company’s board gave permission to sell the license at auction. Three companies offered bids. AT&T offered an “expression of interest” in 10 megahertz for $5.8 million, and Hawaiian Wireless offered $7.5 million for 20 megahertz. But Pacific Communications offered the high bid by offering $13.5 million for the entire 30 megahertz. American Wireless accepted the bid in a voicemail message from its lawyer James Thomas, Watkins says. The message said Pacific’s bid was accepted with two conditions: that Pacific place a non-refundable 10 percent deposit on the purchase, and that the purchase agreement be completed in 30 days. LETTER NEVER SENT Pacific responded with a letter agreeing to American’s terms and adding two more conditions: that American agree to a 60-day “no shop” period, and that the company make its best effort to complete the deal in 60 days. In a second phone call, Thomas informed Pacific representatives that company CEO Wirt Yerger had signed the letter and accepted the deal. But American Wireless officials never sent the signed letter to Pacific, and without telling Pacific officials, changed the first page of the letter to give American a way out of the deal, according to Watkins. “Specifically, American Wireless now seeks to rely on nondisclosed language added by James Thomas, counsel for American Wireless, which says, ‘This agreement is not binding.’ “ During the same period, Yerger was encouraging AT&T to raise its bid on the 10 megahertz the company had tendered earlier, Watkins says. When American received a new bid, it informed Pacific that it would bring both offers to the board and then decide which to accept. The suit, which sought a declaratory judgment and specific performance, followed.American Wireless also went to court seeking a declaratory judgment that no contract existed, filing its action in the company’s hometown of Jackson, Miss. RUSSELL STEPS IN When Watkins and Womble Carlyle associate Ana C. Davis moved to expedite the trial in Georgia, Russell came up with a seldom-used statute. Under Georgia Code Section 9-2-46, when a suit is filed in another state that could affect an action already pending in a Georgia court, “it shall be the duty of the judge of the court in which the case is pending to set the case specially and ahead of all other business for trial as the first case at the next ensuing term of the court.” After Russell’s ruling, American withdrew its Mississippi action, in exchange for an agreement to go to trial in December. In its pretrial order, American’s lawyers W. Ray Persons of Hunton & Williams in Atlanta and E. Clifton Hodge Jr. and Ross F. Bass Jr. of Phelps Dunbar’s Jackson, Miss., office argued that American had, in fact, informed Pacific officials that the letter was not binding, and that the company had not accepted Pacific’s new terms for the deal. “Plaintiff has no claim for specific performance for the same reason that it has no breach of contract claim: There is no contract for the sale of the Honolulu License,” they wrote. “Because there is no contract for the sale of the Honolulu License, there is nothing to be specifically informed.” PERSONAL PROPERTY ISSUE The defendants construed the license as personal property under the Georgia Uniform Commercial Code, arguing that any contract for the license’s sale had to be signed. “However, there is no written contract signed by American for the sale of the Honolulu License,” they wrote. The Daily Report was unable to reach Persons for comment before press time. But Watkins argued that FCC licenses are not property in the traditional sense, but only indicate a right of use. As such, these licenses aren’t subject to the provisions of Georgia Uniform Commercial Code, Watkins says. The potential jurors, he says, posed a bit of a challenge to the plaintiffs. Many of them, he says, believed that, in a sale, one had to read all the fine print and have every detail worked out. “Most of the people in voir dire didn’t believe that an oral contract would be binding,” Watkins says. But, he adds, the jurors didn’t seem to like the addition of the “non-binding” sentence to the letter that Pacific executives never saw, but that they were told had been signed. “The jury said, ‘No, we can’t let you get away with that,’ ” he says. Watkins says the hours of deliberation that went until the next morning were grueling, but understandable in the circumstances. And he has no complaints. “It was certainly a nice Christmas present for us,” he says.

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