Federal Communications Commission v. AT&T

    Issues

    Do the Communications Act of 1934 provisions that govern the Federal Communications Commission’s assessment and enforcement of monetary forfeitures violate regulated entities’ Seventh Amendment right to a jury trial or impinge on federal courts’ Article III authority?

    Oral argument:
    April 21, 2026
    Court below:
    United States Court of Appeals for the Fifth Circuit

    This case asks the Supreme Court to decide whether the statutory provisions that govern the Federal Communications Commission’s (“FCC’s”) assessment and enforcement of monetary forfeitures violate regulated entities’ Seventh Amendment right to a jury trial or impinge on federal courts’ Article III authority. AT&T, which was ordered to pay a forfeiture by the FCC for violating consumer privacy rights, claims that the Seventh Amendment and Article III entitle it to a jury trial in federal court before such an order is made. The FCC argues that the current procedures—which provide AT&T with the right to challenge enforcement of a forfeiture in federal district court—preserve AT&T’s right to a jury trial in federal court. This case carries implications for the FCC’s ability to assess monetary penalties for violations of federal telecommunications law. It also has implications for other agencies that follow procedures essentially identical to those the FCC followed here.

    Questions as Framed for the Court by the Parties

    Whether the  provisions that govern the Federal Communications Commission’s assessment and enforcement of monetary forfeitures are consistent with the Seventh Amendment and Article III.

    Facts

    The Communications Act of 1934 (“Act”) established the Federal Communications Commission (FCC) and introduced comprehensive federal regulation of the radio and telephone industries. The relevant provisions of Section 222 of the Act bar telecommunications carriers like AT&T from disclosing certain customer information without authorization and require that carriers take care to prevent unauthorized third-party access to such information. Section 503 allows the FCC to investigate whether a carrier violated Section 222, and upon notice to the carrier and a hearing before the FCC, allows the FCC to order that the carrier pay a forfeiture (a financial penalty) for violating Section 222. Under Section 402, a carrier who disagrees with the FCC’s order can, upon paying the forfeiture, appeal that order to a federal appeals court, where there is no right to a jury. Alternatively, under Section 504, a carrier who disagrees with the FCC’s order can refuse to pay the forfeiture. The Department of Justice can then choose to sue the carrier in federal district court to recover the forfeiture, where both parties have the right to request a jury trial.

    Here, the FCC, proceeding under Section 503, determined that AT&T violated customer information protections in Section 222 and ordered AT&T to pay a forfeiture of over $57 million. AT&T decided to proceed under Section 402; it paid the forfeiture and appealed the order to the United States Court of Appeals for the Fifth Circuit. On August 22, 2025, the Fifth Circuit sided with AT&T and vacated the FCC’s forfeiture order. The court held that the FCC’s Section 503 proceedings violated AT&T’s Seventh Amendment right to a jury trial. Relying heavily on the Supreme Court’s recent decision in SEC v. Jarkesy, the Fifth Circuit held that the FCC’s proceedings leading to the forfeiture order were analogous to the type of civil lawsuits for which the Seventh Amendment guaranteed a jury trial; accordingly, it determined that AT&T was entitled to a jury trial. Also citing Jarkesy, it declined to apply the public rights exception, which would have allowed the FCC to proceed administratively, without resorting to Article III courts (and so without a jury). Finally, it determined that AT&T’s ability to proceed under Section 504—that is, to refuse to pay the forfeiture and fight its enforcement in district court in front of a jury—was insufficient to vindicate AT&T’s right to a jury trial.

    The FCC and the United States government (“FCC”) petitioned for a writ of certiorari, which the Supreme Court granted on January 9, 2026. On the same date, the Supreme Court consolidated the case with Verizon Communications v. FCC, a closely-related case where the United States Court of Appeals for the Second Circuit held that the FCC’s forfeiture order under Section 503 for Section 222 violations does not impinge on the Seventh Amendment rights of the carrier. 

    Analysis

    THE COMMUNICATIONS ACT’S MEANING

    The FCC argues that the Act does not create a binding legal obligation to pay a fine even after it determines that a violation has occurred and assesses a forfeiture penalty. According to the FCC, the Act only requires a party assessed a forfeiture to pay if the FCC succeeds in a separate recovery action, which must be brought in federal court. This separate action is tried de novo, which the FCC argues “enables a party to contest the merits anew, before a neutral judge and impartial jury.” The FCC argues that this procedure would not make sense if the initial FCC determination itself was already binding. The FCC adds that the Supreme Court has historically held comparable agency orders to be nonbinding and therefore argues that the processes leading to their issuance are not suits at common law.

    AT&T and Verizon Communications (“AT&T”) counter that “[t]he FCC’s determinations are final in every sense.” AT&T argues that the Act permits the FCC to “determine” whether a violation has occurred and, if one has, that the violating party “shall be liable to the United States” for the violation. AT&T emphasizes that the relevant orders clearly state that the FCC’s process adjudicated the merits of the violation and include instructions for how to pay the balance. That the FCC cannot force payment until after a recovery suit is brought is inapposite, AT&T claims, because it confuses the “legally binding obligation[s]” with “the actual transfer of money” and would render the FCC’s orders “meaningless pieces of paper.”

    THE SEVENTH AMENDMENT’S JURY-TRIAL RIGHT

    The FCC argues that the Seventh Amendment’s guarantee of a jury trial in “suits at common law” does not apply here because there is no “suit” at common law. Suits, the FCC claims, have binding effects that compel one party to do justice to the other. The FCC contends that the actions at issue here are simply internal functions that precede a suit—the follow-on recovery action in front of a jury. And since the initial administrative proceedings do not deprive any party of “life, liberty, or property,” Congress was free to design those procedures as it saw fit.

    The FCC posits that even if the initial agency action is inseparable from the recovery action for purpose of the Seventh Amendment, saving the jury-right for the recovery action is enough. The FCC argues that the Seventh Amendment’s prohibition on “re-examin[ing]” facts after they are examined by a jury does not prohibit “preliminary factfinding by other adjudicators before the jury trial.” If anything, the FCC contends, the predicate fact-finding serves as an additional procedural protection for regulated entities.

    The FCC claims that the Court has approved of similar enforcement schemes which permit juries to examine claims only after some initial party has made a non-binding finding four times before. In all four cases, the FCC contends, a non-jury official made some findings that ultimately could be reexamined by a jury. In two of those cases, the FCC emphasizes, the findings were even initially binding, and the party had to appeal their legal obligation to a jury which prejudiced the jury-right more than the Act here. The FCC thus argues that if those procedures were acceptable under the Seventh Amendment, “then the procedure here is likewise constitutional.”

    Finally, the FCC argues a jury reviewing some initial adjudicatory decision aligns with the history of the Seventh Amendment. The FCC claims that many states—both before and after the ratification of the Seventh Amendment—allowed a justice of the peace to make an initial determination in civil suits, preserving the right to a jury by allowing the losing party to appeal the decision. Like the states, the FCC maintains that Congress has long allowed agencies to make initial determinations prior to a full jury trial, a practice that scholars have always agreed is permissible. Altogether, the FCC asserts that this history illustrates that there is no Seventh Amendment issue in this case.

    AT&T maintains that suits under the Seventh Amendment concern any process in which “legal rights are ascertained and determined,” regardless of who does the adjudication. If a party wants to affirmatively overturn the FCC’s decision, AT&T argues, they would have to bring an appeal in which the FCC’s determinations would be owed significant deference under the Administrative Procedure Act. Thus, AT&T asserts that the initial determination of a violation constitutes a “suit” for Seventh Amendment purposes.

    Additionally, AT&T asserts that the separate, enforcement proceeding with a jury “does not solve the Seventh Amendment problem.” AT&T argues that the FCC’s administrative proceeding and a subsequent collection proceeding are separate, individual suits that both implicate the Seventh Amendment. AT&T maintains that the collection actions mirror traditional actions to compel payment of a previously imposed obligation, which the Court has always held are “original suits rather than only a continuation of the former suit.” While it may be true that the collection suit is sometimes necessary to compel payment, AT&T claims, the initial obligation is still binding “just as the possibility of garnishment does not mean that a debtor may legally ignore his bills.”

    AT&T asserts that the Court’s prior cases do not support the FCC’s procedures. AT&T distinguishes the four cases the FCC relies upon on the grounds that the jury-right applied within the same suit and before any parties’ rights were finally determined or judgment was entered. In contrast, AT&T argues that parties charged with a violation have no guarantee of getting in front of a jury because the FCC may choose not to bring an enforcement action.

    Finally, AT&T contends that the FCC’s enforcement scheme is unsupported by history. AT&T asserts that traditionally, administrative agencies like the FCC did evaluate whether, in their opinion, a party had committed a violation. AT&T argues that those determinations were used as non-binding evidence that a jury could consider in the actual merits suit. AT&T claims that the constitutionality of these previous tentative and inconclusive processes have no bearing on the modern FCC’s role as “freestanding adjudicators.”

    UNCONSTITUTIONAL BURDEN

    The FCC further asserts that the Act’s procedural scheme does not impermissibly burden the right to a jury. The FCC first argues that if the initial adjudication is not considered a suit, then the jury right has not yet attached and, therefore, cannot be burdened. The FCC also claims that even if the two actions are considered a suit collectively, the Seventh Amendment allows for procedures that terminate the litigation prior to reaching a jury such as by voluntarily dismissing a complaint. The FCC maintains that conditioning the jury right on refusing to pay the fine does not impermissibly burden that right because the government is free to condition the exercise of constitutional rights on certain actions so long as the purpose is not “to discourage the exercise of the right.” The FCC contends that the Act does not actually discourage parties from exercising their jury right because it “prevents the mere existence of an order of forfeiture (that had not yet been confirmed after trial in a Federal district court) from being used against a party,” and, even if it does, that incidental effect does not render the Act unconstitutional.

    AT&T counters that parties charged with violating the Act must choose between guaranteed judicial review of their violation by paying and appealing or refusing to pay and hoping that the FCC will bring a collection suit. AT&T argues that letting a forfeiture order stand has serious real-world consequences beyond the FCC like damaging the company’s reputation and appearing as a liability on their books, and effecting negotiations in future government contracts. Additionally, AT&T claims that the Act does not limit the FCC from relying on forfeiture orders in future proceedings because (1) the FCC has done so in the past and (2) even if it interprets the Act that way now, there is no guarantee that it will continue to do so. All of these consequences, the FCC argues, inevitably discourage the exercise of the Seventh Amendment.

    Discussion

    IMPLICATIONS FOR FEDERAL TELECOMMUNICATIONS REGULATION

    In support of the FCC, Former FCC Chairs and Consumer Advocacy Groups (“Former Chairs”) argue that the challenged regulatory scheme has important practical advantages. Specifically, the Former Chairs note that Section 503 arose out of a desire to provide carriers a “streamlined process, resulting in penalties that were designed to be less costly than protracted litigation.” At the same time, the Former Chairs emphasize, Section 504 left open the option for carriers to select a jury trial, thus “balancing efficiency and fairness.” Also in support of the FCC, Citizens Utility Board of Illinois (“Citizens Utility Board”) notes that Section 503 provides carriers advantages besides efficiency. For example, according to Citizens Utility Board, Section 503 proceedings offer procedural rules that may be more favorable to carriers than rules at trial. Also, Citizens Utility Board contends that Section 503 proceedings require the FCC to put its “factual and legal theories” on the record before trial, allowing carriers an early opportunity to evaluate and respond to evidence and legal arguments. Moreover, Citizens Utility Board worries that a decision invalidating the challenged regulatory scheme could leave the FCC without any ability to pursue forfeitures or other monetary penalties, since Section 504 proceedings are a statutorily required precursor for the FCC to sue carriers in federal court. According to the Former Chairs, invalidating Section 503 proceedings would put important consumer information privacy protections—which Congress sought to protect through repeated enactments—at risk.

    In support of AT&T, CTIA – The Wireless Association, NCTA – The Internet & Television Association, and USTelecom – The Broadband Association (“CTIA et al.”) argue that fairness concerns, which are protected by a jury trial, should predominate over efficiency concerns, given the expansive regulatory power of the FCC. Also supporting AT&T, the Chamber of Commerce of the United States of America and Business Roundtable (“Chamber of Commerce”) emphasize that because the FCC claimed the power to issue forfeitures of up to $236 trillion, “more than double the world’s GDP,” a jury trial before the FCC orders payment of fines is necessary to avoid undue concentration of power in the agency. CTIA et al. also worry that the jury trial right under Section 504 is illusory, since the FCC can explicitly or implicitly condition favorable regulatory action in frequently arising routine matters like license renewals on “voluntary” payment of forfeitures previously ordered under Section 503. CTIA et al. argue that such voluntary payments bar carriers from a jury trial, which Section 504 only permits upon a collection action for an unpaid forfeiture, whereas failing to make these voluntary payments renders it “impossible for a [carrier] to do business at all.”

    IMPLICATIONS FOR FEDERAL ADMINISTRATIVE REGULATION IN GENERAL

    Supporting the FCC, Citizens Utility Board emphasizes that at least eleven federal statutes provide for proceedings analogous to those challenged here. Thus, argues Citizens Utility Board, a ruling for AT&T would imply that those schemes are invalid as well, thereby impacting regulatory bodies like the Federal Energy Regulatory Commission, the Department of Energy, the Fish and Wildlife Service, Customs and Border Protection, and the Department of Health and Human Services. Worse, notes Citizens Utility Board, a ruling for AT&T might leave at least some of these agencies unable to seek forfeitures either administratively or in court, thereby fundamentally “kneecap[ping] agency enforcement” across agencies and areas of law. 

    Supporting AT&T, the Institute for Justice agrees with Citizens Utility Board that many other agencies have proceedings analogous to those challenged here, but it emphasizes that many of those agencies regulate small businesses that are much less able to bear the cost of challenging forfeitures than is AT&T. The Institute for Justice argues that agency procedures like those under Section 503 “can take years and often involve multiple rounds of internal agency procedure” and so it is unfair to require small businesses to participate in those costly procedures before allowing them to access to federal courts. Relatedly, the Institute for Justice worries that regulatory agencies can “leverage” the costs associated with a lengthy administrative process to coerce a settlement, regardless of a case’s merits. Also supporting AT&T, Vaping Industry Stakeholders make a related point that small businesses may be unable to absorb even relatively small forfeitures, giving regulatory agencies like the FDA great leverage over those businesses in administrative proceedings—leverage that would be eliminated if businesses could resort to federal courts in the first instance. 

    Conclusion

    Authors

    Written by:    Garrett Taylor and Daniel Lempert

    Edited by:      Andrew Hallowell

    Additional Resources