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On January 9, 2026, the U.S. Supreme Court granted petitions for a writ of certiorari filed by Verizon and the Federal Communications Commission (FCC), agreeing to review conflicting appellate court decisions addressing the FCC's authority to impose monetary forfeitures for violations of the Commission's Customer Proprietary Network Information (CPNI) rules.
The Court consolidated two cases arising from 2024 forfeiture orders:
- In the Fifth Circuit, the court vacated an FCC order imposing more than $57 million in forfeitures against AT&T, holding that the FCC's in-house enforcement process violated the Constitution.
- In the Second Circuit, the court upheld an FCC order imposing nearly $47 million in forfeitures against Verizon, rejecting similar constitutional challenges.
The Supreme Court will now resolve this circuit split and determine whether the FCC may continue to impose civil penalties through its administrative enforcement process, or whether such enforcement must instead proceed in federal court.
Why the Court Likely Took the Case
The Court's decision to grant certiorari strongly suggests that it intends to address — and potentially reaffirm — the constitutional limits articulated by the Fifth Circuit. That court relied heavily on the Supreme Court's 2024 decision in SEC v. Jarkesy, which held that when the federal government seeks civil penalties, defendants are entitled to adjudication in an Article III court and, where applicable, a jury trial.
If the Court agrees with the Fifth Circuit, the FCC would be severely constrained in its ability to unilaterally impose monetary forfeitures through administrative proceedings.
What FCC Enforcement Could Look Like Going Forward
Even if the Court sides with the Fifth Circuit, the FCC is unlikely to lose its enforcement role entirely. Instead, enforcement would likely be reshaped as follows:
- The FCC would retain authority to investigate, issue subpoenas, and develop factual records.
- The Commission could continue to negotiate settlements based on its investigative findings.
- However, where settlement negotiations fail, the FCC would be required to refer the matter to the U.S. Department of Justice, which would then decide whether to pursue enforcement through a civil complaint in federal court.
- Defendants would be entitled to Article III adjudication, including the right to a jury trial.
This would represent a fundamental shift away from administrative forfeitures toward traditional judicial enforcement.
A Growing Enforcement Divide: "Haves" vs. "Have-Nots"
A Supreme Court ruling limiting the FCC's administrative enforcement powers could also deepen existing disparities in how enforcement is experienced across the industry.
Smaller providers and resource-constrained companies may find themselves effectively coerced into settlements, unable to bear the cost, risk, and uncertainty of defending against the federal government in federal court.
By contrast, large carriers and well-capitalized companies — knowing that enforcement would ultimately require DOJ litigation — may become less attractive enforcement targets, or more willing to litigate rather than settle.
The result could be a two-tier enforcement reality:
- Aggressive settlement pressure on smaller entities, and
- Greater leverage and insulation for companies with deep litigation resources.
What This Means for Providers
While the Supreme Court's decision could meaningfully limit the FCC's enforcement mechanics, it does not eliminate compliance risk. Investigations, negotiated settlements, reputational exposure, and DOJ litigation would remain very real concerns.
Providers should continue to:
- Treat CPNI and other consumer protection obligations as high-risk compliance areas;
- Maintain defensible compliance programs and documentation; and
- Carefully evaluate enforcement posture, settlement strategy, and litigation risk in light of a potentially shifting constitutional framework.
We will continue to monitor developments closely and will provide further updates as the Supreme Court briefing and argument schedule becomes clear.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
