UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
WASHINGTON,
D.C. 20549
FORM
8-K
CURRENT
REPORT
PURSUANT
TO SECTION 13 OR 15(d) OF THE
SECURITIES
EXCHANGE ACT OF 1934
Date
of
Report: April 17, 2007
MOBILEPRO
CORP.
(Exact
Name of Registrant as Specified in Charter)
Delaware
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000-51010
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87-0419571
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|
|
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(State
of Incorporation)
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(Commission
File Number )
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(IRS
Employer Identification No.)
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6701
Democracy Blvd., Suite 202
Bethesda,
MD 20817
(Address
of principal executive offices) (Zip Code)
(301)
315-9040
(Registrant's
telephone number)
Check
the
appropriate box below if the Form 8-K is intended to simultaneously satisfy
the
filing obligation of the registrant under any of the following provisions
(see
General
Instruction A.2 below):
o |
Written
communications pursuant to Rule 425 under the Securities Act (17
CFR
230.425)
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o |
Soliciting
material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
240.14a-12)
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o |
Pre-commencement
communications pursuant to Rule 14d-2(b) under the Exchange Act
(17 CFR
240.14d-2(b))
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o |
Pre-commencement
communications pursuant to Rule 13e-4(c) under the Exchange Act
(17 CFR
240.13e-4(c))
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Item
8.01. Other Events.
On
April
17, 2007 the Supreme Court of the United States issued an opinion in the case
captioned Global
Crossing Telecommunications, Inc. v. Metrophones Telecommunications,
Inc.
on
Certiorari from the United States Court of Appeals for the Ninth Circuit (the
“Ninth Circuit” and the “Metrophones Case”), No. 05-705 in which it upheld the
Ninth Circuit’s decision that independent payphone providers have a private
right of action to pursue recovery in federal court from telecommunication
carriers who fail to pay dial around compensation. The ruling in the Metrophones
Case permits litigation to resume that has been pending in federal district
court against AT&T Corporation, Sprint Communications Company, LP and Qwest
Communications, Inc. (the “Defendants”) for non-payment of dial around
compensation. Davel Communications, Inc. and certain of Davel’s subsidiaries
(collectively, the “Davel Entities”) are directly or indirectly plaintiffs in
the federal district court cases against the Defendants. Although the federal
district court case has been pending since 1999, the litigation remains in
its
preliminary phases. As a result, the Registrant cannot predict the likelihood
of
success on the merits, the costs associated with the pursuit of the claims,
the
timing of any recovery or the amount of recovery, if any. However, the industry
representing a group of independent payphone providers, including the Davel
Entities, has recently prevailed in a similar Federal Communications
Commission administrative proceeding against another carrier for
non-payment of dial-around compensation using a similar damages’ model which was
accepted and pursuant to which the Federal Communications Commission assessed
pre-judgment interest (the “Similar Litigation”). The Similar Litigation is
being appealed to the U.S.
Court of Appeals for the District of Columbia. Based
upon our damages’ model in the Similar Litigation, we estimate that
the
amount
in controversy for the Davel Entities against the Defendants extends well into
the eight figures, but any recovery is conditioned on, among other things (i)
prevailing on the merits at trial; (ii) having the Davel Entities’ damages model
and other claims approved in whole or in large part; and (iii) prevailing on
any
appeals that the Defendants may make. As evidenced by the eight years that
this
litigation has been in process, the Defendants have shown an interest in
stretching the duration of the litigation and have the means to do so. Although
the Davel Entities could ultimately benefit (in an absolute sense, although
not
necessarily on a present value basis) from this delay in the event that
pre-and/or post-judgment interest (awarded at 11.25% per annum in the Similar
Litigation) is assessed against the Defendants and the potential award of
attorneys’ fees and/or other remedies (in addition to compensatory damages) if
the Davel Entities prevail, such delay will result in a deferral of the receipt
of any cash to the Davel Entities. Mobilepro Corp. is the senior secured
creditor and sole shareholder of the Davel Entities and therefore would benefit,
potentially materially (subject to the provisos above), from the Davel Entities’
success in this litigation which, with yesterday’s ruling, is now permitted to
proceed.
SIGNATURES
Pursuant
to the requirements of the Securities Exchange Act of 1934, the Registrant
has
duly caused this report to be signed on its behalf by the undersigned thereunto
duly authorized.
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By:
/s/ Jay O. Wright
Jay
O. Wright
Chief
Executive Officer
MOBILEPRO
CORP.
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Date:
April 18, 2007