FCC, Stung by Court Setbacks, Retreats on 2 Rulings : Communications: It revises decisions on local phone competition and wireless paging licenses.

Reeling from a string of embarrassing court setbacks, a humbled Federal Communications Commission voted Thursday to overhaul two key rulings affecting local telephone competition and an upcoming auction of licenses for new wireless paging services.

The agency’s five commissioners voted unanimously to give local telephone companies more leeway in providing facilities for rivals seeking to hook up independent phone networks. The vote was in response to a June 10 decision of the U.S. Court of Appeals in Washington that struck down a previous FCC rule that would have forced local carriers to give rivals space for hookups inside their own central offices.

The vote came a day after commissioners, facing yet another court reversal, decided to scrap their controversial plan to give a free operating license to a company that had pioneered a new wireless communications technology called narrow-band personal communications services. Rivals of the company, Jackson, Miss.-based Mtel, are expected to bid millions of dollars for PCS licenses in auctions scheduled to begin in two weeks.

The FCC’s difficulties are being closely watched in Washington’s huge legal community because judicial review of the agency’s decisions has often produced important administrative law cases that can affect other federal agencies.

“Most of their cases go to the D.C. (federal) court circuit, which tends to be a leading” and closely followed legal forum, said Jeffrey Lubber, research director for the Administrative Conference of the United States, a federal agency that oversees the administrative procedures of other federal agencies.

The FCC has been trying to collect itself following a series of federal court reversals on issues ranging from agency fines to its regulation of long-distance telephone service. The Washington-based trade publication Communications Daily reported this week that the FCC has been reversed in “nearly all appeals in common carrier cases this year.”

The setbacks largely stem from decisions made before the five-member commission took on its current makeup. The panel has received three Clinton Administration appointees since November, 1993.