The U.S. Supreme Court has delivered a significant victory for federal regulators, specifically the Federal Communications Commission (FCC) and the Securities and Exchange Commission (SEC), by ruling in favor of their authority in two critical cases. On June 5, 2026, the court’s decisions not only reaffirmed the power of these agencies but also clarified the boundaries of their regulatory capabilities in light of recent challenges. The rulings come against a backdrop of increasing scrutiny of the so-called “administrative state” and its role in American governance.

Supreme Court’s Stance on Federal Regulatory Power

The Supreme Court, which currently maintains a 6-3 conservative majority, issued its decisions in two cases that have implications for how federal agencies operate. These rulings were characterized by legal experts as reaffirmations of previous constraints on regulatory power, yet they also firmly rejected attempts by challengers to extend these limits further. The court’s backing of the FCC’s system for levying fines and the SEC’s authority to recover illegal profits through disgorgement reflects a cautious but firm endorsement of established regulatory frameworks.

Agency Defenses and Legal Context

In both cases, the Trump administration‘s defense of the agencies indicated a complex relationship with the administrative state. Legal scholars note that while the administration has often been critical of federal regulations, it has recognized the utility of these agencies in enforcing laws and protecting public interest. Georgetown University law professor David Super described the outcomes as “small, largely technical wins” for the FCC and SEC, emphasizing that the court’s decisions should not be viewed as expansions of regulatory power but rather as affirmations of existing authority.

Impact on Telecommunications: A Setback for AT&T and Verizon

The first ruling, which favored the FCC, came in a case involving major telecommunications companies, AT&T and Verizon. The court ruled 8-1 against these companies, which challenged the FCC’s authority to impose financial penalties through internal enforcement arrangements. This case tested the constitutional right to a jury trial in the context of federal agency proceedings, particularly after the court’s 2024 decision in SEC v. Jarkesy, which limited in-house proceedings at the SEC.

Despite the court’s rejection of AT&T and Verizon’s arguments that the Jarkesy ruling should apply to the FCC, it did clarify that companies are not legally bound to comply with forfeiture orders until a jury reviews the agency’s fines. University of Michigan Law School professor Daniel Deacon noted that while the ruling did not extend the reach of previous decisions, it underscored the rights of companies to contest such penalties in court.

Strengthening the SEC’s Disgorgement Authority

The second ruling was a unanimous 9-0 decision that reinforced the SEC’s authority to seek disgorgement of illicit profits without the need to demonstrate that victims suffered pecuniary loss. This ruling is particularly significant as it bolsters one of the SEC’s most important enforcement tools against financial fraud. The case involved defendant Ongkaruck Sripetch, who contested a court order requiring him to repay over $3 million in profits gained from fraudulent activities.

Legal experts, including attorney Jose Lopez, pointed out that the court’s decision preserves the SEC’s ability to effectively enforce regulations and protect investors. The ruling clarifies that the SEC does not need to prove direct economic harm to pursue disgorgement, thereby enhancing the agency’s enforcement capabilities against financial misconduct.

Broader Implications for Regulatory Authority

The recent rulings come at a time when the Supreme Court has increasingly scrutinized the powers of federal agencies. In recent years, the court has embraced a conservative legal framework that limits executive agency actions, particularly through the major questions doctrine. This legal principle allows judges to invalidate agency actions that have significant economic and political implications unless Congress has clearly authorized them.

The court’s decisions to uphold the FCC’s and SEC’s authority, while simultaneously maintaining constraints on regulatory overreach, reflect a balancing act that could influence future regulatory actions. Brianne Gorod, chief counsel at the Constitutional Accountability Center, remarked that these rulings serve as a reminder of the unpredictable nature of the current Supreme Court, especially in its dealings with federal agencies.

Conclusion: Regulatory Landscape Moving Forward

As the legal landscape continues to evolve, the Supreme Court’s recent decisions highlight the ongoing tensions between federal regulatory agencies and the business interests they oversee. While these rulings provide a temporary boost to the FCC and SEC, they also signal to Congress and the administrative state that adherence to established regulatory limits is essential. Legal experts will be closely monitoring how these rulings impact future cases and the broader regulatory environment.

For more insights and detailed information about these rulings, you can read the full article by John Kruzel at Reuters.