Falcone LightSquared Conflict Complaint Rejected by NASA

NASA’s inspector general dismissed a complaint by Philip Falcone’s LightSquared Inc. that the vice chairman of a panel advising the U.S. government on the company’s proposed broadband network had conflicts of interest.

Bradford Parkinson’s participation in meetings of a NASA- supervised committee at which LightSquared’s plan was discussed didn’t conflict with his role as a board member of Trimble Navigation Ltd. (TRMB), a maker of GPS-enabled equipment, Paul Martin, the space agency’s Inspector General, said in a report released today.

LightSquared, the bankrupt wireless telecommunications company backed by billionaire Falcone’s Harbinger Capital Partners hedge fund, requested the NASA probe in January. The following month, the Federal Communications Commission, the company’s main regulator, said it would block LightSquared’s plan for high-speed wireless data service on concerns that the service would disrupt aircraft navigation and other devices using GPS.

Although Trimble and other GPS companies lobbied against LightSquared’s plan, Parkinson “disclosed his ties to Trimble on his annual financial disclosure statements and made no attempt to hide his board membership or stock ownership,” the inspector general said in a summary statement.

Parkinson’s committee, the National Space-Based Positioning, Navigation, and Timing Advisory Board, advises the federal government on issues related to the U.S. GPS system.

Advisory Panel

Parkinson in one instance improperly participated in a matter affecting Trimble’s finances by signing a letter to the FCC opposing LightSquared’s application, Martin found.

Martin said he found no evidence to contradict Parkinson’s statement that he signed the letter out of concern the LightSquared network would compromise GPS applications, and not out of financial self-interest.

NASA attorneys should review meeting agendas in advance and attend advisory committee meetings whenever possible in the future to identify possible conflicts, Martin recommended.

“We’re pleased to see that programatic changes have been proposed in this report to prevent this kind of improper conduct from happening in the future,” Jeffrey Carlisle, LightSquared’s executive vice president of regulatory affairs and public policy, said in a telephone interview.

The company remains focused on solving technical issues that will permit deployment of its network, Carlisle said.

Parkinson didn’t immediately respond to e-mail and phone messages seeking comment.

LightSquared filed for Chapter 11 bankruptcy protection on May 14. Falcone’s plans for the company depended on winning FCC approval to convert airwaves designated for satellite service to spectrum for land-based radio towers. LightSquared invested $4 billion in airwaves and reached deals with more than 30 partners, including Best Buy Co. (BBY)

To contact the reporter on this story: Andrew Zajac in Washington at azajac@bloomberg.net

To contact the editor responsible for this story: Bernard Kohn at bkohn2@bloomberg.net

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