Phone companies can collect some of the most sensitive information about their customers, such as their location.
This happens because cell phones repeatedly connect to nearby cell towers while they are working.
The Supreme Court noted that every connection can record a phone’s location, giving wireless service providers a clear idea of where a customer’s phone is at any given time.
This information supports helpful services, including roadside assistance. But it can often become much trickier when access goes beyond the phone company and into the hands of outside companies.
The protection and use of sensitive personal data, such as location information, is sacrosanct.
Furthermore, “when placed in the wrong hands or used for nefarious purposes, it puts us all at risk.” This makes safeguarding “customer location data and valid consent to its use” a top priority for the FCC.
That concern is now at the center of a major Supreme Court ruling involving AT&T and Verizon, two of the biggest names in the telecommunications sector.
On June 4, the Supreme Court sided with the Federal Communications Commission (FCC) in a case over whether the agency can impose significant penalties against wireless service providers through its own enforcement process.
In an 8-1 decision, the court ruled that the FCC did not violate the Constitution when it issued forfeiture orders against AT&T and Verizon for their handling of customer location data.
The ruling is a victory for the FCC and a setback for the phone giants, which argued that the agency’s process deprived them of their right to a jury trial.
For consumers, the case is important because it arose from a simple privacy question: What happens when companies that own real-time location data don’t adequately protect it?
FCC fined AT&T and Verizon over customer location data
The original case began with an FCC investigation into the country’s largest wireless service providers.
In April 2024, the FCC fined AT&T, Verizon, T-Mobile, and Sprint nearly $200 million combined for illegally sharing access to customers’ location information.
The FCC said the carriers shared access to that data without customer consent and without taking reasonable steps to protect it from unauthorized disclosure.
Instead of these findings, the FCC charged communications providers:
AT&T was fined more than $57 million.
Verizon was fined almost $47 million.
T-Mobile was fined more than $80 million.
Sprint was fined more than $12 million.
Sprint and T-Mobile have merged since the investigation.
More retail:
The FCC said each carrier sold access to customers’ location information to “aggregators,” who then resold it to third-party providers of location-based services.
The agency said carriers attempted to shift their obligation to obtain customer consent to downstream companies.
In many cases, according to the FCC, that meant that valid customer consent was not obtained.
The FCC also said the carriers continued to sell access to customers’ location information even after learning that their security measures were not working.
So the issue wasn’t just about whether location-based services can be useful. It was about who has access to that information, whether customers agreed to it, and whether phone companies maintained control of the data after sharing it.
Verizon and AT&T are at the center of an FCC data-sharing lawsuit.Shutterstock
Why location data is so sensitive
Location data is different from many other types of consumer information.
A stolen password can be changed. A compromised credit card can be replaced. But a person’s movements can reveal patterns of daily life that are much harder to separate from the person.
Real-time location information can show where you live, work, shop, pray, seek medical care, or spend time with your family.
The FCC called customer location information some of the most sensitive data in carriers’ possession. The agency said communications providers have an obligation to protect that information because it can reveal where customers go and who they are.
“Our communications providers have access to some of the most sensitive information about us. These carriers failed to protect the information they were entrusted with. Here, we’re talking about some of the most sensitive data in their possession: customers’ real-time location information, which reveals where they go and who they are,” said FCC Chairwoman Jessica Rosenworcel.
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The FCC investigation followed public reports that customer location information was disclosed without consent or legal authorization.
The Supreme Court opinion described an incident involving a Missouri sheriff who accessed the “location of numerous individuals” through a location service operated by Securus, a provider of correctional communications services.
For consumers, that is the main concern. Many people know that their telephone company needs certain location information to provide service. Fewer expect that access to that information can pass through a chain of external companies.
AT&T and Verizon challenged the FCC process
AT&T and Verizon challenged the FCC sanctions in court.
Their argument was not just about privacy allegations. They also argued that the FCC’s process violated the Seventh Amendment, which protects the right to a jury trial in certain civil cases.
The companies said the FCC had investigated the case, found the facts and imposed sanctions without first giving them a jury trial.
Lower courts are divided on the issue.
The Fifth Circuit sided with AT&T and vacated the FCC order. He said the FCC process violated the Seventh Amendment because the agency had already discovered the facts and imposed the punishment without a jury.
The Second Circuit ruled against Verizon. He said an FCC forfeiture order does not, in and of itself, require a company to pay. If a company refuses to pay, the government must file a separate civil lawsuit to collect the money.
Now, in a June 4, 2026 decision, the Supreme Court agreed with the second opinion.
Chief Justice John Roberts wrote for the majority that FCC forfeiture orders do not definitively resolve a company’s legal obligations.
In plain language, the FCC can say that a company violated the law and impose a fine, but it cannot collect money on its own if the company refuses to pay.
To collect, the government must go to court. In the latter case, the company can challenge the facts again.
That distinction allowed the FCC system to survive.
What the ruling means for consumers
The decision keeps an important privacy enforcement tool in place.
A ruling against the FCC could have made it harder for the agency to bring major sanctions cases against telecommunications companies, broadcasters, Internet providers and other companies covered by the communications law.
Instead, the Supreme Court said the FCC can continue to issue forfeiture orders because those orders don’t have the final say unless a company pays or the government wins in court.
For companies, the ruling still leaves room for struggle. A company can refuse to pay and have the government sue to collect.
But for consumers, the practical effect is that the FCC is still able to take public enforcement actions when it believes phone companies mishandled sensitive customer data.
The ruling does not create a direct payment for phone users. It also doesn’t mean the Supreme Court decided whether AT&T or Verizon actually violated privacy rules.
But it does preserve the government’s ability to hold carriers accountable when customers’ data practices raise serious privacy concerns.
Justice Thomas dissented.
Justice Clarence Thomas was the only justice who dissented.
Thomas said AT&T and Verizon had already paid more than $100 million after receiving requests from the FCC that appeared to require payment.
He argued that companies should have had a clearer opportunity to proceed under the correct understanding of the law.
The majority did not decide whether AT&T or Verizon are entitled to a refund or what relief might be available.
For now, the ruling keeps the FCC’s enforcement process intact, but does not end the dispute entirely. The Court returned AT&T’s case to the lower court and did not decide whether AT&T or Verizon can recover the fines they already paid.
This case may seem technical, but the consumer issue is simple.
Wireless service providers stand between people and their digital lives. They connect calls, text messages, apps, maps, payments and emergency services. By doing so, they can collect information that shows where people are in the real world.
The Supreme Court ruling means the FCC can still act when it believes information has been mishandled.
This is important because most consumers cannot see how their location data moves once it leaves their phone company.
For mobile phone users, the case is a reminder that privacy risks are not limited to hackers breaking into a database. Sometimes the most important question is what companies can share, who they share it with, and whether customers actually agreed to it.
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This story was originally published by TheStreet on June 9, 2026, where it first appeared in the Technology section. Add TheStreet as a preferred source by clicking here.
