WASHINGTON (Reuters) – A U.S. appeals court has overturned an effort by communications regulators to modify certain media-ownership rules to make it easier to own a newspaper and a broadcast outlet in a single market.

The U.S. Court of Appeals for the Third Circuit said on Thursday that the cross-ownership portion of the Federal Communications Commission’s 2008 order had failed to meet the notice and comment requirements set out by law.

In late 2007 the FCC narrowly approved a loosening of its three-decade-old media ownership restrictions in the 20 biggest U.S. cities, despite the objections of consumer groups and some lawmakers.

The appeals court decision left intact other elements of the FCC’s order, including waivers for dozens of newspaper-broadcast ownership combinations in specific markets that had been grandfathered under a previous rule.

Free Press, one of the public interest groups that had objected to the looser cross-ownership stance, welcomed the court’s action.

“Today’s decision is a sweeping victory for the public interest,” said Corie Wright, policy counsel for Free Press. “The court wisely concluded that competition in the media — not more concentration — will provide Americans with the local news and information they need and want,” Wright said.

FCC General Counsel Austin Schlick said the decision had affirmed the FCC’s authority to ensure a healthy and vibrant media marketplace.

WASHINGTON, June 23 (Reuters) – U.S. government officials called for more testing of hedge fund manager Philip Falcone’s satellite broadband start-up to address interference issues with global positioning systems, but showed interest in finding a solution rather than shutting the venture down.

Falcone’s LightSquared has come under fire after months of testing found its original plan for a high-speed wireless network would interfere with GPS services connected to aviation and maritime operations, emergency communications systems, weather tracking, General Motors Co’s (GM.N: Quote, Profile, Research, Stock Buzz) OnStar equipment and countless other government and commercials uses.

“We have now tested one proposal here, and we found unfortunately that it did not work as originally hoped. That does not mean the story is over,” said Department of Transportation Under Secretary for Policy Roy Kienitz.

“Our goal at DOT is to look for a win-win where we can have much better broadband service nationwide, but to do so without disrupting GPS and vital services it provides,” he said at a joint hearing of two House of Representatives Transportation and Infrastructure subcommittees on Thursday.

LightSquared aims to sell wholesale wireless services to companies such as Best Buy Co (BBY.N: Quote, Profile, Research, Stock Buzz), which would then resell the service under their own brand names.

Signals from the company’s ground antennas overwhelmed most GPS units tested, causing them to show inaccurate location information or no data at all.

Rear Admiral Robert Day, chief information officer for the U.S. Coast Guard, stressed the devastating effects to a multitude of aviation and maritime operations that such interference could cause.

WASHINGTON (Reuters) – AT&T Inc (T.N: Quote, Profile, Research, Stock Buzz) said its $39 billion plan to buy T-Mobile USA remains on track for approval in the first quarter of 2012.

AT&T General Counsel Wayne Watts told reporters on Tuesday that the regulators’ review of the deal thus far had been thorough, fact-based and “exactly as we expected.”

The company has supplied the Justice Department with a requested second round of data, and has reviewed the comments of those who oppose the deal. The comment period closed Monday at the Federal Communications Commission.

“Here we are the day after those comments are in, and I can tell you I have not been surprised by anything that has happened in that process,” Watts said.

The deal, which requires FCC and Justice Department approval, would concentrate 80 percent of U.S. wireless contract customers in just two companies — AT&T/T-Mobile and Verizon Wireless (VZ.N: Quote, Profile, Research, Stock Buzz) (VOD.L: Quote, Profile, Research, Stock Buzz).

AT&T contends that the merger is necessary to improve service to its customers in the near-term by upgrading a network criticized by consumers for dropped calls and slow data speeds.

The company has committed to expanding next generation 4G wireless service to 97 percent of the U.S. population.