The U.S. Supreme Court handed federal regulators a pair of notable victories on Thursday, siding with the Federal Communications Commission (FCC) and the Securities and Exchange Commission (SEC) in separate disputes that tested the limits of agency authority.
While the court has spent recent years curbing aspects of federal regulatory power, the latest rulings signaled that those earlier restrictions are not automatically a launchpad for broader attacks on government agencies.
In one case, wireless giants AT&T and Verizon challenged the FCC’s enforcement framework for imposing financial penalties. The companies argued that the Supreme Court’s 2024 decision restricting certain in-house enforcement proceedings at the SEC should also undermine the FCC’s process.
The justices disagreed. By an 8-1 vote, the court upheld the FCC’s system, declining to extend its earlier ruling into new territory. At the same time, the court emphasized that businesses are not required to simply accept FCC penalty orders without recourse, noting that those fines can still be challenged through judicial proceedings involving a jury.
The decision represented a setback for the telecom companies but also clarified the boundaries of the court’s previous ruling on administrative enforcement powers.
The second dispute centered on one of the SEC’s most powerful enforcement tools: disgorgement, the practice of forcing wrongdoers to surrender profits obtained through unlawful conduct.
The case arose from a challenge to an order requiring repayment of more than $3 million linked to an alleged fraud scheme. The defendant argued that the SEC should be required to prove that victims suffered direct financial losses before seeking disgorgement.
The Supreme Court unanimously rejected that argument. The justices concluded that their earlier decision limiting disgorgement to net profits did not require the SEC to demonstrate specific economic harm to victims before recovering illicit gains.
The ruling preserves a key weapon in the regulator’s enforcement arsenal and reinforces the agency’s ability to pursue financial remedies in fraud cases.
Taken together, the decisions stand out because they arrive after a series of high-profile Supreme Court rulings that have narrowed federal agency power. In recent years, the court has embraced doctrines that make it easier to challenge significant regulatory actions and has dismantled long-standing judicial deference afforded to agencies when interpreting the laws they administer.
Yet Thursday’s opinions suggested that the court is not prepared to automatically expand those precedents whenever a new challenge emerges. Instead, the justices appeared content to enforce the limits they have already established without pushing them further.
For federal regulators, the outcome amounted to a rare double victory in an era when agency authority has frequently faced intense judicial scrutiny. For businesses and litigants hoping to use recent Supreme Court decisions to further weaken regulatory power, the message was equally clear: previous victories do not guarantee the court will continue moving the boundaries.
