DENIED!!: Eleventh Circuit Refuses to Permit Intervention in IMC Case– IS This The End For One-to-One? (Probably)
So big news today.
This morning the Eleventh Circuit Court of Appeals entered an order denying the efforts of several parties– including the National Consumers League–to intervene and defend the FCC’s TCPA one-to-one consent ruling.
This development comes after the Eleventh Circuit had previously struck down the ruling and the FCC stated it would not pursue it further.
With this latest denial the fate of the TCPA one-to-one rule appears sealed. Theoretically the proposed intervenors could seek Supreme Court review of the Eleventh Circuit’s denial but the chances of success on such an effort are too low to merit discussion.
So, unless something insane happens (and these days- who knows!) the FCC’s TCPA one-to-one consent rule is officially dead!
Yay.
R.E.A.C.H. will be updating its standards in light of this change so be on the lookout for that.
Although the FCC’s TCPA one-to-one consent rule is dead the FCC’s TCPA revocation rule is not– in fact it is very much alive and in effect RIGHT NOW.
Over the weekend I saw on LinkedIn some folks suggesting the “reasonable means” provision of the ruling was stayed– ABSOLUTELY FALSE. The ONLY part of the rule that was stayed was the scope provisions– so be sure to get it right!
Speaking of getting it right, Telnyx CEO Dave Casem is now set to speak at LCOC III, along with Quote Velocity, Tree, Everquote and a ton of other big names. You CANNOT miss this show folks. Ticket prices jump soon so get in now.
Chat soon.
Crossing Borders with Electronics: Know Your Rights and Risks
With increasing digitalization of our lives and businesses, privacy concerns from border searches of phones, laptops and tables are a growing concern for professionals, executives, and frequent international travelers. U.S. Customs and Border Protection (CBP) has broad authority to inspect travelers and their belongings at ports of entry. This includes electronic devices, which may be searched without a warrant under what’s known as the “border search exception” to the Fourth Amendment.
In 2024, CBP conducted approximately 47,047 border searches of electronic devices, including 42,725 basic media searches, 4,322 advanced media searches, 36,506 non-U.S. citizen electronic media searches and 10,541 U.S. citizen electronic media searches. Notably, there has been a recent string of legal U.S. residents (people with work visas, permanent resident cards, etc.) facing deportation or visa revocation based on information discovered on their electronic devices.
In one case, a Lebanese physician was deported after CBP officers found photos and videos related to Hezbollah on her cellphone. In another, an Indian Ph. D student at Columbia University had her visa revoked following scrutiny of her social media activity and participation in campus protests. Last month, a French scientist was denied entry to the U.S. after Department of Homeland Security (DHS) alleged he was carrying confidential information from an American lab. However, the French government claimed he was targeted for expressing political opinions on the U.S. government.
Although U.S. citizens generally cannot be denied reentry for refusing to unlock a phone, CBP agents can detain a device for further inspection. As for non-citizens, they may face additional consequences, including delays, detention or denial of entry. The line between what is permissible and what is excessive remains unsettled, as federal courts across the country have issued conflicting rulings.
CBP classifies device searches into two categories, a basic search and an advanced search. A basic search is a manual inspection of an unlocked device and can be conducted without suspicion. An advanced search involves connecting the device to external equipment for forensic review and requires “reasonable suspicion” that the device contains unlawful material. Although CBP and ICE policies remain in effect, some courts have begun to push back on this authority, particularly in cases involving U.S. citizens.
Border Search Cases and 2018 DHS Policy
Courts consistently uphold the “border search exception”, reasoning that the government’s interest in controlling who and what enters the country is at its highest at the border. As the Supreme Court explained in United States v. Ramsey and later reaffirmed in United States v. Flores-Montano, routine, suspicion-less searches of persons and property at the border are generally considered “reasonable” by virtue of the location.
In the past two decades, as digital privacy concerns have grown, courts have increasingly grappled with how these principles apply to smartphones, laptops, and other electronic devices. To address this evolving legal landscape, the DHS issued a policy directive in 2018 requiring that forensic or advanced searches of electronic devices be supported by reasonable suspicion. However, in general, border searches of electronic devices do not require a warrant or suspicion.
United States v. Smith: change from reasonable suspicion to probable cause?
The reasonable suspicion framework was disrupted in May 2023, when Judge Jed Rakoff of the Southern District of New York issued a groundbreaking decision in United States v. Smith, holding that the government must obtain a warrant supported by probable cause before searching and copying an American citizen’s phone at the border, absent exigent circumstances.
In this case, Jatiek Smith was stopped by CBP officers at Newark Liberty International Airport in March 2021. He had been under investigation by DHS Investigations and the FBI before his arrival, and federal agents used CBP’s border authority as a means to conduct a search without seeking a warrant. Agents forced Smith into revealing his phone password under the threat of indefinite detention, copied the contents of his device, and returned it. Weeks later, the government obtained a search warrant for the data it had already reviewed and later secured a wiretap based in part on the findings from the initial search.
Judge Rakoff ruled that this process violated Smith’s Fourth Amendment rights. Relying heavily on the Supreme Court’s reasoning in Riley v. California, which held that law enforcement must obtain a warrant before searching an arrestee’s cell phone, Judge Rakoff reasoned that the vast quantity and sensitivity of digital information carried on modern devices demands greater constitutional protection and the border search exception did not justify the warrantless search and forensic copying of Smith’s phone.
Despite finding a constitutional violation, the court declined to suppress the evidence under the “good faith” exception. Judge Rakoff concluded that the agents had reasonably relied on existing CBP policy and that a subsequently obtained warrant covered much of the forensic review.
This case is currently on appeal at the Second Circuit. Smith remains a bold but isolated ruling. Judge Rakoff’s decision has not gained traction in other jurisdictions and in 2023, the Fifth Circuit declined to adopt Judge Rakoff’s reasoning in a similar case. To date, CBP has not issued any new guidance or directives in response. Whether Smith signals the start of a broader judicial shift, or remains an outlier cautionary case, will likely be determined by future decisions. In the meantime, individuals should assume that their devices may be subject to search or seizure at the border, even without a warrant. Therefore, to preserve digital privacy prepare accordingly. If a device is seized or an individual is detained, they should promptly contact a lawyer knowledgeable in border search and digital privacy law.
Key Takeaways
Travel light, digitally.Travelers should consider carrying “clean” devices that contain only the data needed for the trip. If a device is seized, having only limited data can help ensure a faster review and return, with less risk of compromising privacy or confidentiality.
Device searches are not limited to phones and laptops.Border agents may search any electronic storage device, including flash drives, portable hard drives, SIM cards, and other accessories. Travelers should consider removing or securing peripheral media before traveling.
Encryption and shutdown protocols matter.Ensure all devices are protected with full-disk encryption and power them off before arrival. (Apparently, CBP are able to remotely access devices in the customs areas.)
All documentation must be updated and valid.Non-citizens who are required to have a visa or work permit for entry need to ensure all documentation is valid (i.e. not expired or incomplete). Otherwise, the traveler will be turned away or possibly detained.
Protect your confidential and sensitive information. While device seizure at the border does not automatically signal a criminal investigation, information obtained during a border search may later be used in criminal, civil or immigration proceedings. Importantly, many travelers carry sensitive or protected data – such as trade secrets, privileged communications, HIPAA protected medical information, or confidential financial information on their devices. These categories of data may not be adequately protected from disclosure during a border search. Consulting with counsel in advance of travel can help protect this information appropriately.
Organizations should develop internal guidance.Employers, universities, and other institutions whose personnel travel internationally should consider developing clear protocols for cross-border travel with sensitive information. Consulting with counsel in advance of travel, particularly for individuals in sensitive roles, can help mitigate legal and reputational risks. It is important to know your risks and rights at the border.
Mexico Overhauls Federal Data Protection Law
Isabel Davara F. de Marcos of Davara Abogados S.C. reports that on March 20, 2025, the Mexican Congress approved a new Federal Law on the Protection of Personal Data Held by Private Parties (“LFPDPPP”), replacing the previous 2010 federal data protection law. The LFPDPPP, which became effective March 21, 2025, represents a substantial change in Mexico’s data protection framework, impacting the scope of application, legal bases for data processing, and individual rights. Relevant updates and considerations for companies operating in Mexico include:
expanded definition of personal data;
broader legal bases for processing;
stricter privacy notice requirements;
enhanced individual rights over automated processing; and
increased fines and a new judicial structure (i.e., the creation of specialized data protection courts to handle legal proceedings, including constitutional rights lawsuits).
The LFPDPPP dissolves the National Institute for Transparency, Access to Information and Personal Data Protection, transferring its authority to a newly created Secretariat of Anti-Corruption and Good Governance. This body will oversee compliance, conduct investigations, and impose sanctions.
Promulgating regulations are expected to be issued within 90 days from the law’s effective date, which are expected to clarify the scope and operational details of the law.
LEAD LESSON: Court Gives Final Approval to $6.5MM PillPack TCPA Settlement And Its All About Lead Buying
One of the biggest TCPA class certification rulings in recent years was the order certifying the suit against PillPack a few years back.
Another TCPA Certification Disaster: Business Practice in Danger After TCPA Case Certified Against PillPack in Suit Involving Oral Consent to Transfer Calls
The case involved the common practice of a lead generator getting consent to call a consumer and then pitching a third-party’s product– in this case, PillPack’s. However PillPack’s name was not on the form, just the lead generators.
The original certification order was just brutal and massive but then Fluent came forward and assisted with a decertification effort. Still enough risk existed that PillPack went forward with the classwide resolution and agreed to pay $6.5MM.
FLUENT TO THE RESCUE!: Popular Lead Supplier Bails Out Seller With Critical Consent Data Sufficient to Decertify Class
Well in Williams v. PillPack, 2025 WL 1149710 (W.D. Wash April 18, 2025) the court approved the settlement and awarded $2.1MM to class counsel. Each class claimant will receive between $212.00 and $350.00.
$6.5MM is an expensive lesson for lead buyers. And one others in the space are still learning. Lead generators cannot just place calls and transfer to lead buyers unless the buyer is also on the form! It doesn’t matter that the call was placed by the lead generator and the generator was on the form– if the lead buyer isn’t there is significant risk.
WE CAN SPAM BUT YOU CAN’T SPEAK: CTIA Claims Wireless Carriers Should Be Able to Text Consumers Without Consent–While it Tries to Censor Everyone Else
Its funny.
If you study history deeply enough, you’ll learn that morality is almost completely relative.
Anything you can think of (no matter how vile by today’s standards) has been permitted/encouraged/justified by some people somewhere at some time throughout history it seems except for one thing– hypocrisy.
Holding yourself to the same standards you would apply to others is the only actual “golden rule” it would seem. And it looks like CTIA just broke it.
So the Wireless Association–which calls itself CTIA for some reason– publishes a set of “guidelines” for communications to cell phones that it claims nobody is actually required to follow yet every carrier and aggregator requires people to follow.
But in true “do as I say not as I do” fashion CTIA is claiming that its own members– the wireless carriers themselves– don’t have to follow any of those rules at all.
Indeed, in a new filing made by CTIA to the FCC as part of the “Delete, Delete, Delete” proceeding the CTIA urges the FCC to close a proceeding that would require wireless carriers to have consent to contact consumers.
In the CTIA’s mind requiring wireless carriers to have consent before texting consumers would be “UNNECESSARY, OVERLY COMPLEX, OR EXCEED FCC AUTHORITY.”
Instead, it urges the Commission to “exclud[e] calls and texts from wireless providers to their subscribers” from TCPA coverage. Indeed, applying the TCPA to by wireless carriers “would risk harming consumers” the CTIA claims.
Hmmm……
So, preventing wireless carriers from spamming consumers causes “harm” but blocking urgent, consented, informational messages consumers actually asked for– which the CTIA guidelines and carrier terms of use call for– is totally cool?
Ridiculous.
The wireless carriers are trying to right themselves a blank check to spam people while holding speech by American business hostage to an outright censorship regime.
Just gross folks.
Hopefully the Commission acts promptly to ban carrier call blocking of lawful traffic as R.E.A.C.H. requests and hopefully the FCC also APPLY THE TCPA TO WIRELESS CARRIERS so we can stop a MAJOR source of spam calls and messages.
Digital Financial Assets – Out Of The Frying Pan And Into The Fire?
The application of the securities laws to digital financial assets has been fraught for lawyers and their clients. After taking a hard line that many of these assets were securities under the federal securities laws, the Securities and Exchange Commission with the change of Administration now appears to be taking a less hostile approach. In January, Acting Commissioner Mark Uyeda announced the formation of a Crypto Task Force. Then in February, the Staff of the Division of Corporation Finance issued a statement that certain meme coins are not securities.
A conclusion that a digital financial asset is not a security may simply transfer regulation from one regulator (the SEC) to another (the California Department of Financial Protection & Innovation), or as Bilbo Baggins exclaimed: “Escaping goblins to be caught by wolves!”*
California’s Digital Financial Assets Law will require persons engaged in “digital financial asset business activity” to be licensed by the Department. Cal. Fin. Code § 3201. The DFAL defines “digital financial asset” as “a digital representation of value that is used as a medium of exchange, unit of account, or store of value, and that is not legal tender, whether or not denominated in legal tender.” Cal. Fin. Code § 3102(g)(1). One exclusion from this definition is a “security registered with or exempt from registration with the United States Securities and Exchange Commission or a security qualified with or exempt from qualifications with the department.” Cal. Fin. Code § 3102(g)(2). Accordingly, if the SEC determines that a digital financial asset is a security, someone exchanging, transferring, or storing that asset would be subject to the DFAL, unless exempt. Conversely, a determination that a particular digital financial asset is not a security would bring persons engaged in exchanging, transferring, or storing that asset within the ambit of the DFAL. Oddly, a security that is neither registered with nor exempt from registration would not be excluded from the definition of a “digital financial asset” for purposes of the DFAL.
___________________J.R.R. Tolkien, The Hobbit, or There and Back Again.
State Privacy Regulators Announce Formation of Privacy ‘Supergroup’
The concept of the “supergroup” may have originated with rock and roll, but on April 16, 2025, privacy practitioners in the United States learned that a whole new type of supergroup has been formed. Far from being a reboot of Cream or the Traveling Wilburys, however, this latest supergroup is comprised of eight state privacy regulators from seven states (each of which has enacted a comprehensive state privacy law), who announced they have formed a bipartisan coalition to “safeguard the privacy rights of consumers” by coordinating their enforcement efforts relating to state consumer privacy laws.
Quick Hits
State attorneys general from California, Colorado, Connecticut, Delaware, Indiana, New Jersey, and Oregon, as well as the California Privacy Protection Agency, announced the formation of the “Consortium of Privacy Regulators.”
While the creation of the Consortium does not reflect a closer alignment in the contents of the actual consumer privacy laws themselves, it will likely heighten regulators’ abilities to enforce those elements of consumer privacy law that are common across states.
Businesses may wish to take this announcement as a sign to revisit their consumer privacy policies and practices, lest they find themselves subject to additional scrutiny by this new regulatory “supergroup.”
The Consortium of Privacy Regulators, comprised of state attorneys general from California, Colorado, Connecticut, Delaware, Indiana, New Jersey, and Oregon, as well as the California Privacy Protection Agency, seeks to facilitate discussions of privacy law developments and shared regulatory priorities, and to share expertise and resources to focus on multijurisdictional consumer protection issues. The constituent attorneys general come from states that have been particularly active in the privacy regulation space, and this coalition will ostensibly allow them to pursue more coordinated, large-scale efforts to investigate and hold companies accountable for noncompliance with common legal requirements applicable to personal information. Of particular importance to this new regulatory body is the facilitation of consumer privacy rights, such as the “rights to access, delete, and stop the sale of personal information, and similar obligations on businesses.”
While this announcement is certainly big news, it is not entirely surprising. Over the course of the past several years, there has been an apparent uptick in coordinated regulation in other areas of data privacy law, especially with respect to data breach investigation and enforcement at the state regulatory level. Just as state attorneys general have been following up with companies that have reported data breaches with an increased diligence and depth (and, in some cases, imposing more substantial civil penalties and seeking to enter into consent orders with these companies), companies can likely expect similarly heightened scrutiny with respect to their consumer privacy practices. And, given the Consortium’s announced intent to hold regular meetings and coordinate enforcement based on members’ common interests, businesses can likely expect that this additional scrutiny will begin very quickly.
Next Steps
Given this increased focus on regulatory enforcement, companies that have not already done so may wish to prioritize taking steps to shore up their personal information handling practices. Businesses that collect personal information might consider revisiting their privacy policies to ensure they accurately reflect their personal information collection, disclosure, and other handling practices. They may also want to review their procedures for handling highly visible elements of consumer privacy law, including their processes for responding to data subject rights requests. And, of course, businesses might give some thought to whether this announcement is a timely reminder to refresh their employees’ training with respect to consumer personal information. Finally, given the requirements in many of the constituent states’ privacy laws that consumer personal information be appropriately protected, businesses might consider revisiting their cybersecurity measures, including by updating (or even implementing for the first time) incident response plans and performing tabletop exercises to identify potential gaps and opportunities for increased alignment with applicable legal requirements before the Consortium comes knocking.
Digital Dollars, Not Investments: SEC Staff Weighs in on Stablecoins
On April 4, the Securities and Exchange Commission’s (SEC) Division of Corporation Finance issued a statement clarifying that reserve-backed U.S. dollar stablecoins are not securities, at least under current law and circumstances. The nonbinding guidance marks the latest effort by SEC staff to articulate the boundaries of the agency’s jurisdiction in an evolving crypto regulatory landscape.
Stablecoins are blockchain-based digital assets that are typically pegged to traditional currencies like the U.S. dollar (we previously discussed the stablecoin market here). The statement addresses “Covered Stablecoins”—those pegged to the U.S. dollar and backed by sufficient low-risk, liquid assets, so as to allow a Covered Stablecoin issuer to fully honor redemptions on demand. Covered Stablecoins are designed to maintain a stable value by being fully backed by reserves equal to or greater than the total amount of that stablecoin in circulation. The issuer allows users to mint or redeem these stablecoins at a fixed rate of $1 per coin (or the corresponding fraction), at any time and in any quantity.
The SEC staff noted that these tokens are marketed for use in payments, money transmission, or storing value, not as speculative investments. SEC staff reasoned that because buyers are not motivated by profit, and the tokens do not confer ownership rights or returns, the transactions involved in minting and redeeming such stablecoins do not require registration under federal securities law.
While the staff’s position offers some comfort to stablecoin issuers, it is not a formal rule and carries no legal force.
Putting It Into Practice: This development comes as Congress considers legislation to establish a regulatory framework for stablecoins. The House Financial Services Committee recently advanced the STABLE Act with bipartisan support (previously discussed here). The SEC’s also announcement comes amid a broader trend of various federal regulators recalibrating their approach to digital assets (previously discussed here, here, and here). As stablecoin regulation begins to take shape, market participants should continue to carefully monitor this space for further developments.
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Competition Currents | April 2025
In This Issue1
United States | Mexico | The Netherlands | Poland | Italy | European Union
United States
A. Federal Trade Commission (FTC)
1. FTC staff reaffirms opposition to proposed Indiana hospital merger.
On March 17, 2025, the FTC advised the Indiana Department of Health to deny the merger application of Union Hospital, Inc. (Union Health) and Terre Haute Regional Hospital, L.P. (THRH). According to the FTC’s comment letter, this second attempt to merge under a proposed certificate of public advantage (COPA) has the same anticompetitive harms as their original application. The FTC warned that the merger poses substantial anticompetitive risks, such as higher healthcare costs for patients and lower wages for hospital workers. In September 2024, the FTC issued a similar letter opposing the same parties’ proposed COPA, which the parties later withdrew in November 2024.
2. FTC launches joint labor task force to protect American workers.
A newly established Joint Labor Task Force as of Feb. 26, 2025, consisting of the FTC’s Bureau of Competition, Bureau of Consumer Protection, Bureau of Economics, and Office of Policy Planning, will focus on identifying and prosecuting deceptive, unfair, and anticompetitive labor-market practices that negatively impact American workers. The task force will also work on developing information-sharing protocols between the FTC’s bureaus and offices to exchange best practices for investigating and uncovering such practices, as well as promoting research on harmful labor-market issues to guide both the FTC and the public. The FTC chairman created the Joint Labor Task Force to streamline the agency’s law-enforcement efforts and ensure labor issues are prioritized in both consumer protection and competition-related matters.
3. FTC approves final order requiring building service contractor to stop enforcing a no-hire agreement.
The FTC, on Feb. 26, 2025, has finalized a consent order that mandates Planning Building Services and its affiliated companies to cease enforcing no-hire agreements. In January 2025, the FTC filed a complaint against Planned Building Services, Inc., Planned Security Services, Inc., Planned Lifestyle Services, Inc., and Planned Technologies Services, Inc., collectively known as Planned Companies (Planned). The complaint claimed that the companies used no-hire agreements to prevent workers from negotiating for higher wages, better benefits, and improved working conditions. Under the final consent order, Planned must stop enforcing no-hire agreements, both directly and indirectly, and must not inform any current or potential customer that a Planned employee is bound by such an agreement. The order also requires Planned to eliminate no-hire clauses from their customer contracts and notify both customers and employees that the existing no-hire agreements are no longer enforceable.
B. U.S. Litigation
1. D’Augusta v. American Petroleum Institute, Case No. 24-800 (U.S. Mar. 31, 2025).
On March 31, 2025, the U.S. Supreme Court refused to take up a putative class action alleging that the governments of Russia, Saudi Arabia, and the United States entered into an anticompetitive agreement in 2020 to cut oil production. According to the lawsuit, the multinational agreement arose during the height of the COVID-19 pandemic, when oil prices declined substantially due to decreased demand. In dismissing the case, the Ninth Circuit held that any alleged agreement between foreign nations and the U.S. government were matters of foreign policy and therefore outside of the judicial branch’s jurisdiction. As is tradition, the U.S. Supreme Court did not issue a separate opinion explaining its reasons for refusing to consider the appeal.
2. Dai v. SAS Institute Inc., Case No. 4:24-cv-02537 (N.D. Cal. Mar. 24, 2025).
On March 24, 2025, the Honorable Judge Jeffrey S. White dismissed allegations brought against SAS Institute, Inc., the creator of an artificial intelligence algorithm that others allegedly used to fix hotel prices. According to the complaint, subsidiary IDeaS Inc. licensed SAS’s software to various hotel chains, whom plaintiffs claim used the algorithm to set increased room rates nationwide. While Judge White did not issue an opinion regarding the remaining defendants’ pending motions to dismiss, he stated that at least with respect to SAS, there is no allegation or proof of a direct contract between SAS as a parent company and these hotel chains, and the mere fact that SAS’s software allegedly “powered” the anticompetitive activity was not enough to make it a defendant.
3. State of Tennessee v. National Collegiate Athletic Association, Case No. 3:24-cv-00033 (E.D. Tenn. Mar. 24, 2025).
Also on March 24, a federal district judge in the Eastern District of Tennessee approved the settlement of a class action that four states and the District of Columbia brought against the National Collegiate Athletic Association (NCAA). The states brought the suit on behalf of their respective colleges and universities to challenge the NCAA’s rule that prohibited those schools from marketing potential name, image, and likeness (NIL) compensation to prospective athletes as part of the school’s recruitment. According to the settlement, the NCAA will cease enforcing its existing rules that prevent athletes from learning about or negotiating potential NIL contracts as part of college recruitment.
4. Davitashvili v. Grubhub, Inc., Case No. 23-521 and 23-522 (2d Cir. Mar. 13, 2025).
On March 13, 2025, a divided Second Circuit held that while food delivery service Uber Technologies Inc. could force customers to arbitrate “the arbitrability” of their antitrust claims, a court would decide if fellow defendant and competitor Grubhub Inc.’s antitrust claims were subject to the arbitration. The appeals arise out of allegations that both Uber and Grubhub require restaurants to agree not to sell food at lower prices than those offered on their platforms, which plaintiffs claim resulted in increased prices to consumers. According to the court, the differing results arise in part because Uber’s terms of service more clearly state that the question of whether antitrust suits are subject to the arbitration clause is itself a question that is left to the arbitrator, whereas Grubhub’s terms of service fail to sufficiently require an arbitrator to determine questions of arbitrability. In a dissenting opinion, the Honorable Judge Richard J. Sullivan disagreed with the majority’s conclusion that claims against Grubhub were “unrelated” to consumers’ use of the app, noting that “what gave Grubhub the market power to commit the alleged antitrust violations” was the very fact that consumers used the app.
Mexico
SCJN endorses COFECE’s fine against Aeromexico; emails were key in the decision.
The Second Chamber of the Supreme Court of Justice of the Nation (SCJN) has ratified the investigative powers of the Federal Economic Competition Commission (COFECE), concluding more than five years of litigation Aeromexico initiated.
The airline had challenged a fine of MEX 88 million ($4.21 million) that COFECE imposed in 2019 for colluding to manipulate airline ticket prices on several routes, affecting more than 3 million passengers. The Second Chamber ultimately confirmed the sanction.
In this and other cases, much of the evidence against Aeromexico was obtained through surprise verification visits, a key tool of COFECE. These visits allow access to the offending companies’ offices to collect crucial physical and electronic evidence that may otherwise be destroyed. During one of these visits, COFECE found emails between airline executives, where, using nicknames, codes, and false email addresses, they allegedly conspired to manipulate prices.
Aeromexico argued before the SCJN that these emails were “private communications” and, therefore, could not be used as evidence. However, the Second Chamber determined that these communications are not protected by the right to privacy and can be used to investigate and sanction monopolistic practices that affect consumers, especially when it comes to commercial communications between companies or their personnel.
The Netherlands
A. Dutch ACM Statements
1. ACM provides guidance for car dealership concentrations.
The Dutch competition authority (ACM) has issued a detailed guideline outlining its approach to assessing mergers and acquisitions within the car dealership sector. This guideline aims to provide clarity to the industry by offering a step-by-step overview of the information car dealerships must submit and the analyses they must conduct when filing merger notifications. The objective is to ensure an efficient and precise evaluation process for both the ACM and the companies involved.
To minimize administrative burdens on businesses, the guideline introduces threshold values. Companies operating below these thresholds need only provide a straightforward market share analysis. For companies exceeding these thresholds, further procedural steps are outlined. This approach is designed to support companies in complying with notification requirements efficiently.
2. ACM may investigate possible violations under the Digital Markets Act.
The ACM now has the authority to investigate compliance with the Digital Markets Act (DMA). This European legislation, in effect since May 2023, aims to foster competition in digital markets and provide better protection for consumers. The DMA imposes obligations on major digital platforms, known as “gatekeepers.” Key obligations for gatekeepers include offering fair terms in app stores, providing businesses free access to their own data, and ensuring interoperability between apps and hardware. The ACM will work closely with the European Commission (“EC”) through joint investigative teams to address these matters.
The ACM is authorized to investigate complaints from businesses facing access issues with these platforms and collaborates with the EC, which holds exclusive enforcement powers under the DMA. Since the Dutch implementation law took effect March 10, 2025, the ACM has gained investigative authority. The ACM encourages businesses to report any difficulties encountered with gatekeepers.
3. ACM investigates the acquisition of Ziemann Nederland by Brink’s and is advocating for a ‘call-in power.’
The ACM has initiated an investigation into the recent acquisition of Ziemann Nederland by Brink’s, a leading player in the Dutch cash-in-transit sector. As a result of the takeover, Ziemann will exit the Dutch market, heightening the ACM’s concerns regarding reduced competition.
Brink’s has stated that the acquisition did not require prior notification to the ACM as the turnover thresholds were not met. However, the ACM is now examining whether the transaction may breach competition laws, including the prohibition on abusing a dominant market position. Furthermore, the ACM is advocating for a ‘call-in power,’ which would enable it to investigate smaller acquisitions that may have adverse effects, even if they fall below the turnover thresholds. Such a measure would enhance the ability to address market power and its associated risks, both at the national and European levels.
B. Dutch Court Decision
Dutch Supreme Court to rule on follow-on claims from a single, continuous breach of European competition law.
The central issue in this case concerns the determination of the applicable law for claims seeking damages resulting from a single and continuous infringement of the European cartel prohibition under Article 101 TFEU, known as follow-on claims. The dispute involves cartel damages stemming from an international cartel of airlines that coordinated prices for fuel and security surcharges between 1999 and 2006. The EC has previously issued fines to the airlines involved, while claims-vehicles Equilib and SCC are seeking compensation on behalf of the affected parties.
Both the lower court and the court of appeals ruled that Dutch law applies to these cartel damage claims under the Unjust Act Conflicts Act (WCOD). The court of appeals held that a single and continuous infringement gives rise to one damages claim per injured party, regardless of the number of transactions that party undertakes. It also noted that the WCOD contains a gap in cases where multiple legal systems could govern a single-damages claim. The court suggested that this gap may be addressed by allowing a unilateral choice of law, in line with Article 6(3) of the Rome II Regulation.
The case is now before the Supreme Court, which is questioning whether the concept of a “single and continuous infringement” should be defined under European Union law or whether this determination is left to the member states’ national laws. The Supreme Court is considering referring a preliminary question to the Court of Justice of the European Union (CJEU). The proposed question seeks to establish whether EU law, particularly the principle of effectiveness, mandates that a single and continuous infringement be treated as a single wrongful act resulting in one damage-claim per injured party, or whether member states are permitted to classify each transaction as separate damages claim.
Poland
A. UOKiK Continuous Enforcement Actions Against RPM Agreements
In the March edition of Competition Currents, we reported on the continued interest of the President of the Office of Competition and Consumer Protection (UOKiK President) in resale price maintenance (RPM) agreements, and the actions taken in the last year. UOKiK’s scrutiny of RPM remains strong and in recent weeks, UOKiK has taken further enforcement actions.
1. Fines imposed on Jura Poland and retailers for coffee machine resale price maintenance.
The UOKiK President has imposed fines exceeding PLN 66 million (approx. EUR 16 million/USD 18 million) on Jura Poland and major electronics retailers for engaging in a decade-long price-fixing scheme regarding Jura coffee machines. Additionally, a top executive at Jura Poland faces a personal fine of nearly PLN 250 thousand (approx. EUR 60 thousand/USD 65 thousand).
According to the UOKiK President, Jura Poland, the exclusive importer of Jura coffee machines, colluded with its retail partners to maintain minimum resale prices, preventing consumers from purchasing them at lower prices. The agreement covered both online and in store sales and extended to promotional pricing and bundled accessories.
Evidence gathered through on-site inspections revealed that Jura Poland was actively monitoring compliance, pressuring retailers to adhere to fixed prices under the threat of supply restrictions or contract termination. The scheme’s communication channels included emails, phone calls, messaging apps, and SMS messages.
The anti-competitive arrangement reportedly lasted from July 2013 to November 2022. The UOKiK President imposed fines of PLN 30 million (approx. EUR 7.1 million/USD 7.7 million) on the owner of one retailer, and of PLN 12.2 million (approx. EUR 2.8 million/USD 3.1 million) on Jura Poland. The other retailers received fines ranging from PLN 6.5 million (approx. EUR 1.5 million/USD 1.6 million) to PLN 10.5 million (approx. EUR 2.5 million/USD 2.7 million).
The decision is not yet final and can be appealed to the Court of Competition and Consumer Protection.
2. UOKiK investigates alleged collusion in agricultural machinery sales.
The UOKiK President has launched two antitrust investigations into potential collusion in the sale of agricultural machinery. The first investigation is focusing on major brands in the industry. The second investigation concerns the Claas brand. Allegations of market sharing and price fixing, which may lead to higher costs for farmers, have been made against 15 companies and two executives.
The UOKiK President suspects that dealers were assigned exclusive sales territories, restricting farmers from purchasing machinery outside the designated areas. Customers who attempted to buy from other dealers may have been redirected or offered less favorable prices. Additionally, businesses allegedly exchanged pricing information to discourage cross-regional sales.
If the UOKiK proceedings confirm competition-restricting agreements, the companies could face fines of up to 10% of their annual turnover, while managers risk penalties of up to PLN 2 million (approx. EUR 479 thousand/USD 517 thousand). Under Polish law, anticompetitive provisions in agreements are invalid. Entities suffering harm as a result of an anticompetitive agreement may also seek damages in civil court.
B. UOKiK imposes fines for obstruction of investigation and dawn raids
Companies failing to cooperate with the UOKiK President may face severe penalties. Under Polish law, non-disclosure of the required information may result in penalties of up to 3% of the company’s annual turnover. Sanctions for procedural violations during proceedings, particularly for obstructing or preventing the conduct of an inspection or search, may be imposed on managers, with a financial penalty of up to 50 times the average salary (approx. PLN 430,000/EUR 103,000/USD 109,000).
Last month, the UOKiK President issued three decisions, imposing a total of PLN 1.1 million (approx. EUR 263,000/USD 284,000) in fines.
Another case concerned suspected bid-rigging in the supply of cooling and ventilation equipment. M.A.S. executives refused to grant UOKiK access to the work phones and email accounts of two employees involved in the case. One employee’s data was submitted with a two-month delay, while the other’s was never provided. As a result, the UOKiK President issued two decisions with fines: PLN 350,000 (approx. EUR 84,000/USD 90,000) on M.A.S. and PLN 50,000 (approx. EUR 12,000/USD 13,000) on its CEO. The fine imposed on M.A.S. was relatively high, amounting to approximately 2% of the company’s turnover, while the maximum possible fine was 3%.
Italy
Italian Competition Authority (ICA)
1. Update of turnover thresholds for concentration notifications.
On March 24, 2025, the ICA increased the first of two cumulative turnover thresholds that determine when preventive notification of concentrations becomes mandatory. This threshold, which concerns the total national turnover generated by all companies involved in a transaction, was raised from EUR 567 million to EUR 582 million. The second threshold, which requires at least two of the involved companies to individually generate a national turnover of EUR 35 million, remains unchanged.
2. New guidelines on applying antitrust fines.
On March 10, 2025, following a public consultation, ICA adopted new guidelines on fines, aimed at enhancing the deterrent effectiveness of its sanctioning activities. The innovations include:
the introduction of a minimum percentage, equal to 15% of the sales value, for price-fixing cartels, market allocation, and production limitation cartels;
the possibility of increasing the sanction by up to 50% if the responsible company has particularly high total worldwide turnover relative to the value of sales of the goods or service subject to the infringement, or belongs to a group of significant economic size;
the possibility of further increasing the fine based on the illicit profits the company responsible for the infringement made; and
the consideration of mitigating circumstances in a case of adopting and effectively implementing a specific compliance program, as well as introducing the so-called “amnesty plus,” i.e., the possibility of further reducing the fine if the company has provided information ICA deems decisive for detecting an additional infringement and falling within the scope of the leniency program.
3. New guidelines on antitrust compliance.
On March 10, 2025, ICA adopted new guidelines on antitrust compliance. In particular, the ICA has introduced:
a maximum reduction of penalties up to 10% – instead of the previous 15% – reserved for compliance programs that have proven to be effective (i.e. if the application is submitted before ICA launches an investigation);
a reduction of up to 5% -instead of 10%- in the case of compliance programs that are not manifestly inadequate, adopted before ICA launches an investigation, provided that the program is adequately integrated and implemented within six months;
a reduction of up to 5% for companies with manifestly inadequate programs or for programs adopted newly after the start of the investigation only in cases where substantial changes have been made after the proceeding’s initiation;
no reduction for companies that repeatedly infringed and that had already benefited from a reduction of the fine for a previous compliance program. Moreover, no reduction will be granted to a repeat offender, already having a compliance program, involved in a subsequent proceeding.
4. ICA investigates Rete Ferroviaria Italiana S.p.A.and Ferrovie dello Stato Italiane S.p.A. for potential abuse of dominant position.
On March 18, 2025, ICA launched an investigation against Rete Ferroviaria Italiana S.p.A. (RFI) and Ferrovie dello Stato Italiane S.p.A. (FS) for an alleged abuse of dominant position, in violation of Article 102 TFEU. According to ICA, access to the national railway infrastructure has been slowed down, and in some cases obstructed, impeding the new high-speed passenger transport operator, SNCF Voyages Italia S.r.l. (SVI)’s entry.
The contested behaviors were implemented in the national railway infrastructure market, in which RFI holds a dominant position due to the legal concession granting (D.M. Oct. 31, 2000, No. 138), the company a legal monopoly over the national railway network. In this case, access primarily concerns the high-speed (AV) network. However, the infrastructure involved in the allegedly abusive conduct also includes part of the railway infrastructure intended for regional and medium-long distance transport services. From a geographical perspective, considering the widespread nature of the access conditions across the entire Italian railway network, the actions in question seem to have a national scope.
The alleged abusive conduct carried out in the upstream market of railway infrastructure appears to have hindered SVI’s entry into the passenger railway transport market on the AV network, which is the downstream market where anti-competitive effects would have occurred. ICA carried out inspection activities at the offices of Rete Ferroviaria Italiana S.p.A., Ferrovie dello Stato Italiane S.p.A., and also at the offices of Trenitalia S.p.A. and Italo – Nuovo Trasporto Viaggiatori S.p.A., as they were considered to have information relevant to the investigation.
European Union
A. European Commission
European Commission drops interim measures proceedings against Lufthansa.
The European Commission has closed its interim measures antitrust proceedings against Lufthansa, concluding that the legal conditions for such measures under Article 8 of Regulation 1/2003 were not fully met. The proceedings aimed to require Lufthansa to restore Condor’s access to feed traffic at Frankfurt Airport, as previously agreed between the airlines.
These interim measures were part of a broader investigation into potential competition restrictions on transatlantic routes involving the A++ joint venture between Lufthansa and other airlines. The investigation, launched in August 2024, examines whether the joint venture complies with EU competition rules.
While the interim measures proceedings have been closed, the European Commission continues its main investigation into the competitive impact of the A++ joint venture on transatlantic routes, including the Frankfurt-New York route.
B. ECJ Decision
A parent company can be sued in its home country for its subsidiary’s antitrust violations in another EU member state.
On Feb. 13, 2025, the Court of Justice of the European Union (CJEU) issued a landmark ruling confirming that a parent company may be sued in its home country for antitrust violations its subsidiary committed in another EU member state. The case concerned a Greek subsidiary, Athenian Brewery SA, which the Greek competition authority had sanctioned for abusing its dominant position. Macedonian Thrace Brewery SA subsequently filed a claim for damages before a Dutch court against both the subsidiary and its Dutch parent company, invoking Article 8(1) of the Brussels I bis Regulation. This provision allows for the joint adjudication of claims when they are closely connected.
The CJEU clarified that a parent company and its subsidiary may be regarded as forming a single “economic unit,” thereby justifying both joint liability and international jurisdiction. Furthermore, the CJEU reaffirmed the existence of a rebuttable presumption that a parent company exercises decisive influence over its subsidiary if it holds nearly all of the subsidiary’s shares. This presumption is significant for determining both liability and jurisdiction, provided the claims are substantively interconnected and the risk of contradictory judgments is mitigated.
This ruling carries implications for competition law enforcement within the EU. Aggrieved parties are now able to pursue damage claims in the parent company’s jurisdiction, even if the subsidiary committed the antitrust infringement in another member state. However, national courts must ensure that the conditions for establishing international jurisdiction have not been artificially created, while also allowing the parent company the opportunity to rebut the presumption of decisive influence.
1 Due to the terms of GT’s retention by certain of its clients, these summaries may not include developments relating to matters involving those clients.
Holly Smith Letourneau, Sarah-Michelle Stearns, Alexa S. Minesinger, Miguel Flores Bernés, Valery Dayne García Zavala, Hans Urlus, Dr. Robert Hardy, Chazz Sutherland, Robert Gago, Filip Drgas, Anna Celejewska-Rajchert, Ewa Głowacka, Edoardo Gambaro, Pietro Missanelli, Martino Basilisco, and Yongho “Andrew” Lee also contributed to this article.
FISHING FOR INFO?: Not Enough To Reel In A CIPA Claim!
Greetings CIPAWorld!
I’m back with the latest scoop. Imagine browsing hunting gear at Sportsman’s Warehouse online, checking out a fishing rod. You don’t buy anything, don’t create an account, and don’t enter your email. You look around and leave. Weeks later, you get an email from a completely different outdoor retailer suggesting products similar to what you viewed. That’s creepy, right? That’s the essence of Cordero v. Sportsman’s Warehouse, Inc., No. 2:24-CV-575-DAK-CMR, 2025 U.S. Dist. LEXIS 72337 (D. Utah Apr. 15, 2025).
Here, Plaintiff filed a Complaint against Sportsman’s Warehouse after discovering that his browsing activity had been tracked by a third-party service called AddShoppers without his consent. I was digging through this case last night while coincidentally shopping for tickets to an upcoming Blink-182 concert, and caught myself about to click “Accept All” on a cookie banner to see those ticket prices (long story short… I didn’t buy them… yet). The irony wasn’t lost on me. Those seemingly mundane clicks we make without thinking twice? They matter. And sometimes, as this case shows, even not clicking anything can land your data in someone else’s hands. What’s particularly unsettling about the AddShoppers system described in Cordero is that it operates largely invisibly to the average consumer browsing online. Unlike standard cookies that work on a single website, this third-party tracking system follows you across an entire network of seemingly unrelated websites. Have you all watched the new season of Black Mirror yet?
Unlike the recent decision in Lakes v. Ubisoft, Inc., No. 24-cv-06943-TLT, 2025 U.S. Dist. LEXIS 67336 (N.D. Cal. Apr. 1, 2025), in which cookie consent banners saved the day for the video game company, Plaintiff’s lawsuit failed for a different reason altogether: standing. Judge Dale A. Kimball determined that the Plaintiff hadn’t suffered a concrete harm sufficient to give him Article III standing to bring the case. Interesting stuff.
So let’s dig into what’s at issue here. According to the Complaint, AddShoppers operates a “Data Co-Op” where participating companies install AddShoppers’ code on their websites. When an internet user creates an account or purchases with one business in the network, a third-party tracking cookie with a unique identifier is created that AddShoppers associates with that user. Pretty straightforward, right? Once that cookie is in your browser, AddShoppers can track your activity across any website in its network. What? Yes, you read that right. Suppose you’ve provided personal information to one site in the network. In that case, AddShoppers can use that information to target you with ads from completely different companies, even if you never gave those companies your information. For instance, you’re shopping around, adding a pair of boots to your cart on one site and then, days later, getting an email from another company you’ve never interacted with about outdoor gear, all because the two retailers are plugged into the same silent backend tracking system. Spooky stuff.
AddShoppers’ co-founder described this operation as having two data sources: a “blind Co-Op” where brands submit data in exchange for using the collective data pool, and “publisher relationships” where they license data for additional scale. This creates what the Complaint described as a “data lake, ” a centralized repository where information from different sources is matched to create detailed profiles of individuals. What’s particularly concerning is that, according to the Complaint, AddShoppers’ network includes companies selling highly personal products like feminine hygiene and men’s health items, potentially revealing private information to anyone sharing a computer with the user.
Plaintiff’s data request from AddShoppers revealed he had been tracked by at least a dozen companies, including Sportsman’s Warehouse, for several years. The timestamps revealed exactly when he visited these websites. But here’s the critical point that ultimately closed down Plaintiffs case. Here, Plaintiff never provided any personal information to Sportsman’s Warehouse. Plaintiff simply visited their website.
The Court analyzed this lack of personal information exchange through precedent established by the Supreme Court in TransUnion L.L.C. v. Ramirez, 594 U.S. 413 (2021). The Court emphasized that “Only those plaintiffs who have been concretely harmed by a defendant’s statutory violation may sue that private defendant over that violation in federal court.” Id.The Court ruled that a timestamp showing when someone last visited a website doesn’t constitute personal information that can identify an individual under California law.
Distinguishing this case from In re Facebook, Inc., Internet Tracking Litigation, 956 F.3d 589 (9th Cir. 2020), where Facebook was accused of capturing detailed browsing information that was used to create personally identifiable profiles describing users’ “likes, dislikes, interests, and habits over a significant amount of time.” Unlike Facebook, Sportsman’s Warehouse never obtained Plaintiff’s personally identifiable information.
As the Court put it, “Sharing the last time someone visited a website is not statutorily protected in California as protected personal information.” Cordero, 2025 U.S. Dist. LEXIS 72337. This reasoning was based on similar rulings in Cook v. GameStop, Inc., 689 F. Supp. 3d 58 (W.D. Pa. 2023), which held that “product preference information is not personal information” and In re BPS Direct, L.L.C., 705 F. Supp. 3d 333 (E.D. Pa. 2023), which stated that “browsing activity is not sufficiently private to establish concrete harm.”
The Court also declined to follow decisions like Lineberry v. Addshopper, Inc., No. 23-cv-01996-VC, 2025 U.S. Dist. LEXIS 29903 (N.D. Cal. Feb. 19, 2025), where the Complaint alleged plaintiff made a purchase and was plausibly identifiable. Here, Plaintiff made no purchase, provided no email, and entered no personal details. Those factual gaps were key here in the Court’s reasoning.
Sportsman’s Warehouse also asserted the persuasive authority in Ingrao v. AddShoppers, Inc., No. 24-1022, 2024 WL 4892514 (D. Utah Nov. 25, 2024), which involved nearly identical facts and resulted in dismissal for lack of standing. The Court found Ingrao persuasive and more directly applicable than Facebook, particularly because both Ingrao and Plaintiff’s case lacked allegations that personal data was ever collected, let alone misused.
So what does this mean for you and me? While Plaintiff’s case was dismissed for lack of standing, it provides more insight into how companies track our digital footprints in ways most of us never consider. Those seemingly browsing sessions on retail websites could be feeding into vast data-sharing networks that follow you across the internet.
For companies, the lesson here might seem to be you’re in the clear as long as you don’t collect identifiable personal information. But that would be missing the bigger picture. As privacy laws evolve and consumers become more aware of tracking practices, the legal landscape could shift dramatically. In Lakes, the Court held that layered cookie banners could provide legally binding consent. In Cordero, the Court didn’t even get that far, because if there’s no injury, it doesn’t matter what disclosures you did or didn’t give. The procedural defenses may differ, but the outcome is the same: these privacy lawsuits are shut down at the door.
For consumers, cases like this highlight why those cookie preferences matter. When was the last time you read a privacy policy? And if you did, would you expect it to list every company that might get your data? Probably not. But these cases show that courts won’t always assume you didn’t know. Those extra 30 seconds spent clicking “customize settings” instead of “accept all” could mean the difference between your browsing habits being your own business or becoming valuable data points in a marketplace you never consented to join.
Looking at Lakes and Cordero together, a clear trend emerges. If a company collects personal data with explicit consent, it’s protected. Additionally, if it avoids collecting personal data altogether, it’s also protected. For businesses, that’s a powerful takeaway. The current legal framework favors companies that either build robust consent flows or steer clear of collecting personally identifiable information. Even under California’s strong privacy laws, the bar for plaintiffs to survive a motion to dismiss remains high, especially when standing is questioned.
So next time you’re shopping online, whether for camping gear, concert tickets, or anything else, remember that your digital footprints may be tracked in ways you never imagined. Unlike the plaintiffs in Lakes v. Ubisoft, who clicked through consent banners, Cordero never got the chance to consent or decline. Plaintiff just browsed.
All in all, what stood out to me in Judge Kimball’s ruling was how decisively the conversation ended. This wasn’t a case where more facts might have saved the Complaint. The Court didn’t say plead better. It said you were never supposed to be here.
As always,
Keep it legal, keep it smart, and stay ahead of the game.
Talk soon!
CLEAR, UNMISTAKABLE, COMPELLING: Court Compels Arbitration Based On Inclusion Of AAA Rules
Hey, TCPAWorld!
The District of Utah just issued a defendant-friendly decision staying a case and compelling arbitration. See generally Christiansen v. Desert Rock Cap., Inc., No. 2:24-cv-00808, 2025 WL 1135598 (D. Utah Apr. 17, 2025). This case serves as a straightforward reminder of the importance of including an arbitration provision that clearly delegates questions of arbitrability to the arbitrator and incorporates the American Arbitration Association (AAA) rules.
In Christiansen, Plaintiff Christiansen applied for and was issued a loan from Defendant Desert Rock Capital, Inc. (“Desert Rock”). In the loan documents, Christiansen consented to be contacted by Desert Rock for “potential extensions of credit, marketing and advertisement, and any other business purpose.” Id. at *1. He also agreed to resolve “[a]ny and all controversies, claims, alleged breaches or disputes arising out of or relating in any way” to the loan documents through arbitration and to waive his ability to bring a class action. Id.
In the lawsuit, Christiansen alleged that Desert Rock called and texted him advertisements despite being on the national DNCR and despite his repeated DNC requests. Accordingly, he brought claims under the TCPA’s national DNCR and internal DNC provisions. In response, Desert Rock moved to dismiss the complaint or, alternatively, to stay the case and compel arbitration.
In deciding this motion, the Court first explained that it must enforce arbitration agreements according to their terms. And where there is “clear and unmistakable evidence” that the parties delegated the issue of arbitrability to the arbitrator, then it must be submitted to the arbitrator and is not for the court to decide. The Tenth Circuit has found this standard to be met where an arbitration agreement incorporates the AAA rules.
Although Christensen disputed the validity of the arbitration agreement and its applicability to the dispute, the Court rejected this argument because the loan documents explicitly referenced the AAA rules. Accordingly, the Court found the “clear and unmistakable” evidence standard to be met with respect to the issue of arbitrability.
And while Desert Rock sought dismissal of the complaint, the Court explained that “[w]hen a federal court finds that a dispute is subject to arbitration, and a party has requested a stay of the court proceedings pending arbitration, the court does not have discretion to dismiss the suit on the basis that all the claims are subject to arbitration.” Id. at *4 n.26 (quoting Smith v. Spizzirri, 601 U.S. 472, 475-76 (2024), and noting the Tenth and Seventh Circuits’ agreement). Per the Supreme Court’s instruction, the Court therefore stayed the case and compelled arbitration.
Until next time.
FCC’s POWER CUT: Fifth Circuit Guts FCC’s Ability to Issue Forfeiture Orders And this is Completely Game Changing
Not long ago we covered the story of an FCC forfeiture penalty issued against Telnyx related to a robocall scam targeting the FCC itself.
The Commission had determined Telnyx seemingly violated vague know-your-customer rules and was set to hit Telnyx with a multi-million dollar penalty. Telnyx fought back aggresively but the FCC was still left to determine how much it would fine Telnyx for the behaviour.
If that seems weird its because it is.
The FCC was simultaneously acting as victim, witness, prosecutor, judge and jury.
Telnyx’ response noted that Commission staff that received calls at issue should recuse themselves since they were directly involved with the underlying claim– which just makes common sense.
But there is a larger issue– one that AT&T just used to its high advantage. The FCC is weighing the evidence and then imposing a penalty without a court or a jury’s involvement.
And that, my friends, rather obviously violates the Constitution.
None of us can be harmed in any way without: i) a law that makes conduct illegal in place before we engaged in illegal conduct; and ii) a judge and/or jury determining that we, in fact, violated that law based on admissible evidence.
That’s the bedrock of due process and the bedrock of what makes us “free.”
But AT&T was recently denied that freedom by the FCC when it unilaterally determined AT&T was guilty of misusing consumer data and fined it $57MM without a jury’s involvement.
And while that might not sound too scary–I mean, why was AT&T misusing customer location data?–consider that Mr. Trump has recently ordered the FCC to do his exclusive bidding. In theory allowing the FCC to unilaterally determine and assign penalties to any communications company in America could very quickly escalate into something highly political and unpleasant.
The Fifth Circuit Court of Appeals cut all of that off at the pass, however, with a ruling in favor of AT&T holding the FCC’s actions violated the constitution.
In AT&T v. FCC the Court determined the forfeiture penalty at issue was a remedy akin to damages and not akin to equitable relief. The difference is critical– Americans (and companies) have a right to a jury and judge determinations for any relief that is properly considered a damage recovery. Further although the FCC argued it had the exclusive right to determine matters related to common carriers as a “public right” the Court disagreed noting claims against common carriers are often litigated by private rights in court.
The ruling itself is pretty straightforward: outside of very narrow situations, no penalties can be handed down in this country without a judge and jury. There were no exceptions to that rule present here. So out goes the award.
So where does this leave the FCC’s forfeiture power?
Well, unless there is an appeal to the Supreme Court–probably will be–I’d say it is dead, at least in so far as the penalties handed down are monetary awards. That is a MASSIVE change for the FCC that has just lost one of its most potent enforcement tools.
One wonders whether other extra-judicial penalties– such as “shut down orders” targeting intermediate and upstream carriers permitting robocalls to traverse their network–might also be set aside under this doctrine. Very fascinating to consider how deeply this new ruling cuts.
For now though, AT&T gets to walk away from $57MM in penalties–it already paid the money so will be curious to see how it gets it back– and Telnyx is sitting pretty.
Will keep an eye on all of this.