LightSquared hires all-star lawyers in bid to save company

Wireless startup LightSquared has hired prominent conservative lawyers Ted Olson, a former U.S. solicitor general, and Eugene Scalia, a son of Supreme Court Justice Antonin Scalia, as it tries to save its multibillion-dollar plan to build a nationwide 4G wireless network, the company confirmed Tuesday.

Although the Federal Communications Commission (FCC) granted LightSquared a conditional waiver to move forward last year, the commission is now moving to block the company's network over concerns that it would interfere with GPS devices.

The hiring of two prominent litigators may indicate that LightSquared is preparing to challenge the FCC's decision in federal appeals court. 

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Olson successfully argued before the Supreme Court in Bush v. Gore, the decision that ended the Florida recount and handed the presidency to George W. Bush. Olson, along with his Bush v. Gore opponent David Boies, is now leading the federal lawsuit to overturn California's Proposition 8 ban on gay marriage.

Eugene Scalia served as the top lawyer at the Labor Department and more recently represented Boeing in its legal battle with the National Labor Relations Board. 

The hiring of two famous conservative lawyers is notable because some Republicans have accused the FCC and the White House of showing inappropriate favoritism to LightSquared before pulling its waiver. 

Sen. Chuck Grassley (R-Iowa) has pledged to block President Obama's two FCC nominees until the agency releases internal documents on its review of the company. 

The White House and the FCC have denied giving any special treatment to LightSquared, but expanding broadband access has been a top priority for both agencies. 

Testing showed that LightSquared's signal does not bleed into the GPS band. Instead, the problem is that GPS receivers are too sensitive to filter out LightSquared's powerful cell towers operating on nearby frequencies.

LightSquared argues the GPS industry is responsible for building receivers that only listen to their own designated frequencies, but GPS companies argue that LightSquared is trying to build a cellphone network relying on frequencies that should only be used by satellites, which transmit much fainter signals.