Report: Falcone to step down from LightSquared

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People familiar with the negotiations told The Journal that the deal would allow LightSquared to avoid bankruptcy for now. 

The creditors reportedly want an independent board to run LightSquared.

Republican lawmakers have questioned why the FCC allowed LightSquared to get as far as it did in the regulatory process and whether the company benefitted from inappropriate favoritism. 

Sen. Chuck Grassley (R-Iowa) blocked a vote on the president's two nominees to the FCC for four months, demanding that the agency release its internal documents on LightSquared. He said on Friday that he would release his hold after obtaining a new batch of FCC documents.

Last September, Rep. Michele Bachmann (R-Minn.) accused Obama of "crony capitalism" for allegedly giving favor to his political supporters, pointing to Falcone.

Falcone has donated to both Democrats and Republicans in recent years and says he is a registered Republican. He has denied any attempts to influence the process through political connections. 

The White House and the FCC have denied giving any special treatment to LightSquared, but expanding broadband access is a priority for the administration.