Supreme Court Surprisingly Backs FCC Effort To Punish AT&T, Verizon For Spying On Public Location Data

from the stopped-clocks-are-right-twice-a-day dept

On one hand, the Trump administration wants to destroy most corporate oversight, consumer protection, labor rights, and regulatory autonomy. On the other hand, the administration very much wants to abuse government power and wield regulatory oversight in all sorts of terrible ways that censor speech, stifle journalism, and enable corrupt cronyism.

I’ve long noted how FCC boss Brendan Carr in particular personifies this inconsistency. He wants to abuse FCC authority to bully companies he doesn’t regulate (TikTok) and stifle journalistic criticism of the president (ABC, CBS), but he also routinely wants to try and claim that his agency lacks the authority to do anything to protect consumers or hold telecom and media giants accountable for bad behavior.

Those inconsistencies came to a head last week when the Supreme Court ruled 8-1 in favor of the Biden FCC’s attempt to fine AT&T and Verizon for spying on customer location data, selling access to that data to any random old nitwit, and failing to tell their paying customers about it.

A 2018 New York Times story showcased how stalkers, police, people pretending to be police, and the prison system routinely bought access to this data and then failed completely to secure it. Six years later the Biden FCC finally proposed fining wireless carriers $196 million ($91 million for T-Mobile, $57 million for AT&T, $48 million for Verizon) for the abuses.

But the efforts were upended by a 5th Circuit ruling last year declaring that the FCC fines somehow violated AT&T’s Seventh Amendment right to a jury trial (one of several arguments AT&T and Verizon lawyers through at a wall to see what would stick). The 5th circuit had been supportive of a broader Trump administration second term initiative to basically defang the entirety of regulatory corporate oversight.

The wireless carriers’ case leaned heavily on the Supreme Court’s June 2024 ruling in Securities and Exchange Commission v. Jarkesy, which declared that the SEC system for issuing fines violated the right to a jury trial. Verizon and AT&T lawyers insisted that they couldn’t be fined by the FCC for privacy violations, because it violated their Seventh Amendment rights.

So the Trump-stocked Supreme Court had a tricky choice. Do they support the administration’s effort to defang and neuter corporate oversight? Or do they protect their ambition to wield regulatory agencies as a blunt weapon? The Supreme Court decided to go with the latter, though the ruling shouldn’t be construed as any sort of good faith protection of consumer privacy rights or the public interest.

Only Clarence Thomas decided to buy into the telecom industry’s flimsy arguments.

“The Supreme Court got this one right,” John Bergmayer, Legal Director at consumer group Public Knowledge said in a statement. “AT&T and Verizon sold access to their customers’ location data, then failed to stop bounty hunters and even a rogue sheriff from using it to track people who had no idea they were being followed. The FCC investigated, found the carriers liable, and proposed penalties—which the carriers were always free to challenge in court.”

It’s a useful win, but it bucks the broader Trump court trend of declaring most regulatory agencies largely powerless to hold corporate power accountable across a wide variety of industries. And even here you’ll notice the FCC fines came six years after the initial revelations of wireless carrier misbehavior. They never would have come at all if not for the Biden FCC.

It may likely be years more before fines are collected (assuming Carr bothers), and they’ll still likely only comprise a fraction of the money made on the back of abusing consumer privacy. But in the golden age of corruption and incoherent Trump court rulings, you take whatever victories you can get.

Filed Under: brendan carr, fines, location data, privacy, supreme court, wireless

Companies: at&t, verizon