Supreme Court Upholds FCC’s Process to Issue Fines/Forfeitures
- The New York State Broadcasters Association
- 3 days ago
- 2 min read
For the past couple of years, the FCC’s authority to issue fines has been in question. The problems were based on a Supreme Court ruling in Security and Exchange Commission vs. Jarkesy et al. 144 S. Ct. 2117, 219 L. Ed. 2d 650 (2024). That decision overturned an SEC fine. It ruled that when the SEC seeks civil penalties against a defendant for securities fraud, the Seventh Amendment entitles the defendant to a jury trial. The case created havoc for federal administrative agencies seeking to enforce rules and regulations.
The case affected the FCC. Indeed, broadcasters may receive a Notice of Apparent Liability and/or Forfeitures. However, under the Communications Act, the FCC must go to court to collect the fines. Of course, most licensees simply pay the FCC once a forfeiture (fine) is issued. However, if an entity refuses to pay, the FCC must work with the Department of Justice and file a lawsuit in federal court in order to collect. The FCC may collect a fine only if the defendant loses in court.
This process was upheld by the U.S. Supreme Court last week in FCC v. AT&T. The court recognized that FCC decisions were not binding unless and until the DOJ sued to collect them. The Court stated:
“Because forfeiture orders issued under §503(b)(4) do not definitively resolve the parties’ legal obligations, and the FCC’s factual findings in its forfeiture proceedings are not conclusive, it does not violate the Seventh Amendment for the Commission to issue forfeiture orders without the involvement of a jury.”
Moreover, the case is tried de novo, and the facts are litigated with no presumption that the FCC’s decision was correct.
Accordingly, the FCC’s time-honored process for issuing a Notice of Apparent Liability and then a Forfeiture was upheld. Frankly, most stations will continue to pay the fines issued by the FCC without fighting it in a separate federal district court proceeding.
You can see the Supreme Courts decision in FCC v. ATT here.
