T-Mobile takes FCC to court for fining it for not upholding commitment to users

In April 2024, T-Mobile, as well as AT&T and Verizon, were fined for sharing customer location data with aggregators without their consent. The fine was first proposed by the Federal Communications Commission (FCC) in 2020 when it found out that aggregators were sending location information to third parties. T-Mobile is now challenging the decision.

T-Mobile and the FCC fought it out in court on Monday over a $92 million fine imposed on it in April last year. The basis for T-Mobile's arguments is a June decision by the Supreme Court that curtailed the Securities and Exchange Commission's authority. The Securities and Exchange Commission was instructed to go to federal court -where juries are used to decide a case - to seek damages instead of relying on an in-house judicial process.

T-Mobile says that the Supreme Court's decision in Securities and Exchange Commission v. Jarkesy should invalidate the FCC’s penalty system. The FCC had previously argued that the ruling didn't apply to the FCC as companies had the option of refusing to pay the fine and letting the Department of Justice (DOJ) take over, in which case a jury trial would be possible.

This reasoning didn't convince judges, who said that this route requires companies to waive legal objections. One of the reasons why AT&T, T-Mobile, and Verizon paid fines was that it allowed them to appeal the decision.

Another thing that weakened the FCC's case was that in most instances, the systems the carriers had in place worked to keep customer data safe, and only a small number of users were affected by unauthorized requests. The FCC maintained that the companies didn't do enough to protect customer data after it emerged that Securus, a communication company serving prisons, was providing location data to a Missouri sheriff without court orders who used it to track mobile phone users.

T-Mobile and the other wireless companies have also argued that the data in question isn't protected by the Communications Act. They say that the law only holds them responsible for the data they have as a result of providing voice services and not the information they have as a result of providing data services.

The judge's panel was skeptical of this claim and said that carriers should safeguard all information entrusted to them.

If the court decides in T-Mobile's favor, it may make the FCC a little more cautious about how it approaches such incidents in the future.