Cybersecurity Policy Report, Verizon Asks Supreme Court to Review Second Circuit Privacy Ruling, (Nov 14, 2025)

By Paul Kirby

Verizon Communications, Inc., has asked the Supreme Court to review a September decision by a three-judge panel of the U.S. Court of Appeals for the Second Circuit (New York) affirming an FCC fine of nearly $47 million for violating customer proprietary network information (CPNI) protections.

There is a circuit split on the issue, with Verizon and T-Mobile US, Inc., losing their cases at the Second and D.C. Circuits, respectively, and AT&T, Inc., winning in the Fifth Circuit (New Orleans).

The FCC has asked the Supreme Court to review the ruling by a three-judge panel of the Fifth Circuit that vacated the FCC’s 2024 forfeiture order fining AT&T more than $57 million for violating CPNI protections (CPR, Oct. 10).

In the unanimous Fifth Circuit decision, the judges cited last year’s Supreme Court decision in Securities and Exchange Commission v. Jarkesy, which held that an SEC in-house enforcement action deprived parties of their Seventh Amendment right to a jury trial and that the SEC case “did not fall within the ‘public rights’ exception, which would let Congress assign certain matters to an agency instead of an Article III court.”

In its petition for a writ of certiorari seeking review of its case in Verizon Communications, Inc., v. FCC, No. 24-1733 (2nd Cir. Sept. 10, 2025), Verizon said, “This Court engaged in that careful scrutiny in SEC v. Jarkesy, 603 U.S. 109 (2024). In Jarkesy, the Court held unconstitutional under the Seventh Amendment an SEC administrative scheme that allowed the agency to impose monetary penalties for fraud without the protections of a jury trial. The Court reasoned that civil monetary penalties designed to punish or deter a wrongdoer—rather than to restore the status quo—are a classic remedy at common law, and a defendant is generally entitled to a jury trial before such remedy is imposed. Id. at 123.

“The FCC scheme at issue here mirrors the SEC scheme rejected in Jarkesy in every material respect. The FCC ordered Verizon to pay $47 million as a forfeiture penalty based on the alleged failure to safeguard customer data. The agency claimed the authority to ratchet up that number to the billions of dollars (or even, by the logic of its statutory interpretation, trillions of dollars), but selected its $47 million fine based on the level of culpability that it perceived here.

“There can be no doubt that the remedy is punitive and thus legal, and that the underlying cause of action is akin to common-law negligence. So this should have been an easy case under Jarkesy,” Verizon argued.

“The government, however, has seized on a distinct statutory quirk to defend the FCC’s penalty scheme,” the petition complained. “After the FCC imposes a final payment order in-house, a telecommunications carrier has two options to pursue further review. First, it can pay the FCC order and go right to the court of appeals (where no jury is available). Second, the carrier can defy the FCC’s order and wait to see whether the Department of Justice decides to bring a collection action in district court at some point over the next five years. Because thatpotential collection action carries a right to a jury trial, the FCC sees no Seventh Amendment problem with imposing massive in-house penalties beforehand. The Second Circuit and D.C. Circuit have both blessed the FCC’s theory, while the Fifth Circuit has rejected it as pure constitutional circumvention.

“The after-the-fact possibility of a jury trial does not comply with the Seventh Amendment for several reasons,” Verizon said.

“Of course, the Court need not decide the merits now,” Verizon said. “There is a clear, acknowledged 2-1 circuit split. The government has also sought certiorari. … Everyone agrees that the question is critical both to the FCC and to the carriers subject to its jurisdiction. This case is a clean vehicle, which has long traveled parallel with AT&T. The Court therefore should grant both cases, consolidate them for briefing and oral argument, and realign the parties so that the carriers are on one side and the FCC is on the other.”

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