Get tomorrow's brief in your inbox
Today: The Supreme Court heard arguments in FCC v. AT&T, questioning whether multi-million dollar FCC fines violate the Seventh Amendment's jury trial guarantee. The UK's Ofcom opened investigations into Telegram, Chat Avenue, and Teen Chat over child safety violations under the Online Safety Act, with potential fines up to £18 million or 10% of global revenue. An Illinois jury awarded $70 million to families affected by NEC injuries linked to Similac and Enfamil baby formula.
Supreme Court Questions FCC's Authority to Impose $100M+ Fines Without Jury Trials (FCC v. AT&T)
The Supreme Court heard oral arguments on whether the FCC violated the Seventh Amendment when it assessed $57 million in penalties against AT&T and $46.9 million against Verizon for violations of customer data protection requirements under the Telecommunications Act of 1996. The carriers argue the fines, imposed through in-house proceedings without jury trials, constitute a "straightforward violation" of the Seventh Amendment. The 5th Circuit agreed with AT&T and vacated the fine, while the 2nd Circuit upheld the fine against Verizon, creating a circuit split. During nearly 80 minutes of argument, justices appeared skeptical but also receptive to the FCC's argument that the forfeiture orders are not binding until the Department of Justice brings an enforcement lawsuit, at which point a jury trial becomes available. This case follows SEC v. Jarkesy (2024), which held that SEC fines imposed through administrative proceedings for securities fraud violated the Seventh Amendment.
Supreme Court Appears Receptive to SEC's Disgorgement Authority (Sripetch v. SEC)
The Supreme Court heard arguments in Sripetch v. SEC on whether the SEC can force wrongdoers to turn over profits to the government through "disgorgement" without proving direct harm to customers. Ongkaruck Sripetch pleaded guilty to selling unregistered securities and was ordered to pay $6 million in profits to the SEC. Most justices seemed comfortable with the SEC's authority to collect "ill-gotten gains" even without proving customer harm. Justice Ketanji Brown Jackson noted that requiring someone to pay back wrongful profits is not a "punishment" like a fine would be. Justice Sonia Sotomayor, who wrote the Court's most recent ruling on this topic in Liu v. SEC, suggested that common law disgorgement principles have never required proof of pecuniary harm.
State Farm Settles New Mexico Underinsured Motorist Claims for $20.93M (Case No. 18-CV-00328-KWR-SCY)
State Farm agreed to a $20.93 million settlement to resolve claims it charged New Mexico policyholders illegal offsets when paying underinsured motorist claims between January 1, 2010, and December 31, 2021. The lawsuit alleged State Farm failed to explain offset procedures, resulting in reduced underinsured motorist payments. Class members with minimum limits U Coverage can receive up to 21% of premiums paid; those with non-minimum limits can receive up to 13%. The case is Schwartz v. State Farm Mutual Automobile Insurance Co., et al., in the U.S. District Court for the District of New Mexico. The final approval hearing is scheduled for June 8, 2026.
Domino's Faces California Junk Fees Class Action (Case No. 3:26-cv-01712)
A California customer filed a class action lawsuit against Domino's Pizza, alleging the company charges "junk fees" labeled as "Tax 2" on receipts to offset business expenses. Plaintiff John Murphy claims Domino's violates California's Honest Pricing Act, which prohibits advertising prices that exclude all mandatory fees. The lawsuit seeks declaratory and injunctive relief, plus statutory, monetary, and punitive damages for California consumers charged fees when making in-person purchases at Domino's restaurants. The case was filed in the U.S. District Court for the Northern District of California.
FBI Director Kash Patel Files $250M Defamation Suit Against The Atlantic (Case No. 3:26-cv-01712)
FBI Director Kash Patel filed a $250 million defamation lawsuit against The Atlantic over a profile reporting that current and former officials described him as frequently drinking to visible intoxication and being difficult to reach for time-sensitive decisions. The complaint alleges actual malice based on The Atlantic's decision to publish despite Patel's pre-publication denials. Legal experts note the complaint fails to adequately plead actual malice under New York Times v. Sullivan, which requires showing the publisher knew the statements were false or had reckless disregard for their truth. The complaint's core argument that "the subject denied it and you published anyway" does not meet the actual malice standard.
NEC Baby Formula Jury Awards $70M in Illinois
An Illinois jury awarded $53 million in compensatory damages and $17 million in punitive damages ($70 million total) to four families affected by necrotizing enterocolitis (NEC) injuries linked to cow's-milk-based baby formula (Similac and Enfamil). More than 1,700 NEC lawsuits remain pending across federal and state courts, including 784 claims in MDL No. 3026. Families allege manufacturers failed to warn that cow's-milk-based formulas significantly increase NEC risk in premature infants compared to breast milk. Bellwether trials are scheduled for July 6, August 3, November 2, 2026, and February 1, 2027.
Alabama Judge Acquits First Amendment Protester in Penis Costume Case
Municipal Judge Haymes Snedeker acquitted Renea Gamble, a 62-year-old protester arrested for wearing an inflatable penis costume at a political demonstration in Fairhope, Alabama. Gamble was charged with disorderly conduct, resisting arrest, disturbing the peace, and giving a false name after Fairhope Police Cpl. Andrew Babb arrested her during a "No Kings" protest. Babb justified the arrest by stating Fairhope was "a family town" and questioned what he would tell his children if they saw the costume. Judge Snedeker found Gamble not guilty on all charges but stated he believed there "may have been enough probable cause" for the arrest, complicating potential civil rights claims.
UK Ofcom Opens Child Safety Investigations into Telegram, Chat Avenue, and Teen Chat
The UK's online safety regulator Ofcom announced investigations into Telegram, Chat Avenue, and Teen Chat for potential violations of the Online Safety Act. The Telegram probe follows evidence from the Canadian Centre for Child Protection allegedly showing child sexual abuse material (CSAM) is present and shared on the platform. Ofcom is investigating whether Telegram violated the law's requirement that user-to-user services monitor and address child sexual abuse and exploitation risks. The Chat Avenue and Teen Chat investigations examine whether the platforms adequately protect children from grooming and harmful content like pornography. If found in violation, Ofcom can impose fines up to £18 million ($24.3 million) or 10% of qualifying worldwide revenue and force platforms to make changes.
DMCA Best Practices for Fediverse and Decentralized Social Media Operators
The Electronic Frontier Foundation published guidance for operators of Mastodon, ActivityPub, Bluesky, and other decentralized social media platforms on limiting copyright liability under the DMCA's safe harbor provisions. To qualify for safe harbor protection, operators must: (1) designate a contact to receive copyright infringement notices and register that agent with the U.S. Copyright Office's Designated Agent Directory (listings expire after three years); (2) respond promptly to infringement notices by removing or disabling access to alleged infringing material; and (3) implement a repeat infringer policy. The guidance notes that infringement notices are frequently wrong, misguided, or abusive, and that operators can choose to disregard suspect notices, though this risks losing automatic safe harbor protection.
Cloud Platform Vercel Breached Through Third-Party AI Tool
Cloud development platform Vercel disclosed a cyberattack traced to the compromise of Context.ai, a third-party AI tool installed on an employee's device. The attacker used access from Context.ai to take over a Vercel employee's Google Workspace account, enabling access to Vercel environments and environment variables not marked as "sensitive." Vercel warned a "limited subset of customers" that their credentials were compromised and advised immediate rotation. The company hired Mandiant to assist with the investigation. Context.ai disclosed that a March 2026 incident involving unauthorized AWS access also compromised OAuth tokens for consumer users. Cybersecurity researchers traced the breach to an infostealer infection on February 17 allegedly involving a Context.ai employee's device.
EU Sanctions Russian Propaganda Networks Euromore and Pravfond
The European Union imposed sanctions on Euromore and the Foundation for the Support and Protection of the Rights of Compatriots Living Abroad (Pravfond), two organizations accused of spreading disinformation and supporting Russian hybrid influence operations. The Council of the European Union said Euromore amplifies Kremlin narratives that undermine EU institutions and justify Russia's war against Ukraine. Although most of Euromore's content has been removed, its domain now redirects to Euroview Media, which republishes material from Russian state outlets RT and Sputnik. Pravfond, founded and funded by the Russian state, produces material reinforcing claims that Ukraine has been "Nazified" and that Russian-speaking populations face persecution. The sanctions freeze any EU assets and prohibit EU citizens and companies from providing funds or economic resources to the entities.
Ukraine Dismantles Bot Farm Supplying Russian Intelligence with Fake Telegram Accounts
Ukraine's Security Service (SBU) and National Police detained the suspected organizer of a bot farm in Zhytomyr that sold more than 3,000 fake Telegram accounts per month to Russian intelligence services. The operation blocked nearly 20,000 fraudulent profiles allegedly used to spread propaganda about Ukraine's defense forces, circulate false bomb threats, and destabilize Ukraine's socio-political environment. Law enforcement seized computer equipment, mobile phones, USB hubs connected to modems, and nearly 2,000 SIM cards from multiple Ukrainian telecom operators. The suspect faces up to six years in prison if convicted.
CBS to Host Dinner Praising Trump's First Amendment Record
CBS, now owned by billionaire Larry Ellison, announced it will host a dinner at the U.S. Institute of Peace praising President Trump's dedication to the First Amendment. The event coincides with the Warner Brothers board vote to approve a merger between Paramount and Warner Brothers. Critics note the timing suggests the dinner is designed to curry favor with the administration ahead of regulatory review of the $108 billion merger, which still faces a likely antitrust lawsuit from state attorneys general. The Trump administration has been criticized for threatening broadcast licenses of networks that conduct critical journalism and attempting to suppress comedians and public media.
FCC Penalty Litigation Strategy: Companies facing FCC forfeiture orders should evaluate whether to pay and appeal under deferential standard or refuse payment to force DOJ litigation with jury trial rights, pending Supreme Court decision in FCC v. AT&T.
UK Online Safety Act Compliance: User-to-user platforms operating in the UK must implement documented child safety monitoring systems, including CSAM detection algorithms, active moderation, and cooperation with child protection organizations. Non-compliance can result in fines up to £18 million or 10% of global revenue.
DMCA Safe Harbor Maintenance: Decentralized social media operators must register designated DMCA agents with the U.S. Copyright Office and renew registrations before the three-year expiration. Expired registrations eliminate safe harbor protection.
Third-Party AI Tool Security: Audit all third-party browser extensions and AI tools with enterprise account access. Require employees to use separate personal accounts for consumer AI services. Immediately rotate all credentials after any third-party compromise regardless of sensitivity designation.
California Honest Pricing Act: California businesses must include all mandatory fees in advertised prices. Review point-of-sale systems, websites, and receipts to ensure compliance and eliminate junk fees disclosed only at checkout.
Generated April 22, 2026. Sources: SCOTUSblog, Top Class Actions, TechDirt, The Record, EFF Deeplinks, Lawfare.