Supreme Court sides with Trump administration on federal regulation of telecom companies

The Supreme Court has sided with the Trump administration in a case about the power of federal regulators over telecommunications companies

WASHINGTON -- The Supreme Court sided with the Trump administration Thursday in a case about the power of federal regulators to enforce data privacy laws on telecommunications companies.

The 8-1 decision upheld one of the Federal Communications Commission's key tools, though the companies also won a concession from the Republican administration that could shift the regulatory landscape.

The appeal from telecommunications giants Verizon and AT&T challenged a combined $100 million in penalties imposed after the agency determined that the companies had failed to safeguard customer location data.

The companies argued that the FCC's process was unconstitutional because it gave them little opportunity to tell their side of the story in front of a jury.

The administration defended the fines are an essential regulatory tool. But the government also said companies did not have to pay the penalties right away, a regulatory shift in the company's favor.

The Supreme Court agreed.

“The orders at issue did not settle the carriers’ legal obligations because, stated simply, they did not create an obligation to pay,” Chief Justice John Roberts wrote for the majority.

Justice Clarence Thomas dissented, saying he would have gone further on limiting the agency's power.

Other agencies use similar enforcement methods, so such a sweeping victory for AT&T and Verizon could have had widespread effects, advocates said.

The Supreme Court’s conservative majority has gone the other way and limited the power of federal agencies before. That includes overturning a decades-old decision that had given regulators an advantage in court and stripping another agency of a major tool in fighting securities fraud.