The U.S. Supreme Court, in an 8–1 decision, has upheld the FCC’s authority to issue monetary forfeiture orders against Verizon and AT&T for allegedly failing to protect consumer data, rejecting claims that the FCC’s process violates the Seventh Amendment. The Court held that FCC forfeiture orders are constitutional because they do not impose a binding obligation to pay on the wireless carriers and do not conclusively resolve legal rights; instead, any proposed forfeiture must ultimately be enforced through a de novo court action where a jury can decide the case.
The ruling distinguishes the FCC’s enforcement scheme from the Court’s earlier SEC v. Jarkesy decision, emphasizing that FCC forfeitures are not self-executing and require judicial enforcement. At the same time, the decision limits the practical effect of FCC forfeiture orders by clarifying that they function only as a prerequisite to suit and carry no evidentiary weight in court proceedings.
