Justia Communications Law Opinion Summaries

Several cities challenged recent Texas legislative changes that reduced the fees cities could charge telecommunications companies for using public property alongside city streets. The cities argued that requiring them to charge less than market rates for this use amounted to an unconstitutional gift to the telecom companies, contrary to the Texas Constitution’s Gift Clauses. Seeking a judicial declaration to this effect, the cities sued the State of Texas as the sole defendant, asserting that the statutory rate reductions were unconstitutional.At the trial level, the district court partially granted the cities’ request for a declaratory judgment. The Court of Appeals for the Third District of Texas went further, largely siding with the cities and holding that the statutory reductions violated the Gift Clauses. The State then sought review by the Supreme Court of Texas.The Supreme Court of Texas determined that the lower courts lacked jurisdiction over the case because the cities had sued the wrong defendant. The court explained that in constitutional challenges to state statutes, the proper defendant must be the officer or agency with authority to enforce the challenged law, not the State of Texas in the abstract. The court noted that the cities failed to identify any such officer or agency, and there was no indication that any state official had enforced or threatened to enforce the challenged statutes against the cities. Because a judgment against the “State of Texas” would not redress the cities’ alleged injuries nor bind the telecommunications companies, the dispute lacked the concrete adversarial parties necessary for a justiciable controversy. The Supreme Court of Texas vacated the judgments of the lower courts and dismissed the case for lack of jurisdiction. View "STATE v. CITY OF MCALLEN" on Justia Law

This case involved two major cellular service providers that were investigated by the Federal Communications Commission (FCC) for allegedly mishandling customer location data, potentially violating laws and regulations concerning confidentiality. Following reports of security breaches, the FCC issued notices of apparent liability to the companies and, after reviewing their responses, assessed monetary penalties—about $57 million against one provider and $47 million against the other. The companies paid these penalties but challenged the process, contending that their Seventh Amendment right to a jury trial was violated because the FCC imposed penalties through an administrative process without the involvement of a jury.One of the companies sought review in the United States Court of Appeals for the Fifth Circuit, which ruled in its favor, holding that the FCC’s process violated the Seventh Amendment since the agency found facts, interpreted the law, and assessed penalties without a jury. The other provider’s case was heard by the United States Court of Appeals for the Second Circuit, which upheld the FCC’s process. The Second Circuit reasoned that the FCC’s forfeiture order did not, by itself, compel payment, and any actual collection would require the Department of Justice to file a civil suit, at which point a jury trial would be available.The Supreme Court of the United States reviewed both cases to resolve the conflict. The Court held that the FCC’s procedures did not violate the Seventh Amendment because the forfeiture orders did not create a binding obligation to pay, nor were the FCC’s factual findings conclusive. Instead, a party could insist on a jury trial in a de novo civil enforcement action brought by the government to collect the penalty. The judgment of the Fifth Circuit was reversed and remanded, while the judgment of the Second Circuit was affirmed. View "FCC v. AT&T" on Justia Law

A national news organization published an article in 2021 detailing internal conflicts within a religious group, including a quote from a former member alleging that reports of sexual abuse were “being covered up in ways that were more than anecdotal.” The religious group, which has a large national membership, sued the news organization and the article’s author for defamation, contending that the article’s statements were false and published with actual malice. The author, based in Washington state, conducted all her research and reporting outside New York, though the news organization is headquartered in New York.The United States District Court for the Southern District of New York dismissed the claims against the article’s author for lack of personal jurisdiction, finding she had no relevant contacts with New York. The court also dismissed most of the claims against the news organization, allowing only the statement about covering up sexual abuse to proceed. At summary judgment, the district court applied New York’s anti-SLAPP statute, which requires a heightened showing of actual malice for defamation cases involving matters of public interest, and ruled for the news organization, holding the religious group had not shown a triable issue as to actual malice.On appeal, the United States Court of Appeals for the Second Circuit affirmed both rulings. It held that New York courts did not have personal jurisdiction over the author under the state’s long-arm statute because she did not engage in any journalistic activity in New York related to the article. The appellate court also held that New York’s anti-SLAPP law applied, requiring the religious group to prove actual malice by clear and convincing evidence, and found the group had failed to raise a genuine issue of fact on that element. The judgments for the defendants were affirmed. View "The Satanic Temple, Inc. v. Newsweek Digital LLC" on Justia Law

Guild Mortgage Company LLC and CrossCountry Mortgage LLC are direct competitors in the residential mortgage industry. Over an 18-month period, several Guild employees in the Kirkland, Washington branch, including the branch manager and other high-level staff, were allegedly recruited by CrossCountry while still employed by Guild. According to the complaints, these employees solicited their colleagues to also move to CrossCountry, diverted customers and loan applications, and accessed Guild’s computer systems to take confidential and proprietary information. The employees had signed agreements with Guild prohibiting such conduct, and Guild subsequently lost nearly its entire Kirkland branch workforce to CrossCountry.After Guild initiated arbitration against the former employees and prevailed, it filed a lawsuit in the Superior Court of San Diego County against CrossCountry. Guild’s claims included interference with economic advantage, interference with contract, violation of California’s Comprehensive Computer Data Access and Fraud Act (CCDAFA), unfair competition, and aiding and abetting tortious conduct. The Superior Court sustained CrossCountry’s demurrers, finding that the claims were preempted by the California Uniform Trade Secrets Act (CUTSA) or otherwise failed to state a cause of action, and dismissed the case without leave to amend.The Court of Appeal, Fourth Appellate District, Division One, reviewed the case. It held that Guild had adequately alleged actionable duties of loyalty and, for the branch manager, fiduciary duty, that were breached by the employees and aided by CrossCountry. The court found that the claims for interference and violation of the CCDAFA were not displaced by CUTSA because they arose from conduct beyond trade secret misappropriation. The court also held that the unfair competition claim could proceed since the other claims were viable. The Court of Appeal reversed the judgment in favor of CrossCountry and remanded for further proceedings. View "Guild Mortgage Company v. CrossCounty Mortgage" on Justia Law

The case concerns a man who sued several parties after negative posts about him appeared in a large Chicago-based Facebook group where women share experiences about local men. The posts, made in late 2023, included a woman he briefly dated recounting her unpleasant experiences, attaching a screenshot of a profane text message he sent her after their breakup. Other posts by unidentified users included supportive comments and, in one instance, a link to a news article about a criminal case involving someone with a different name and appearance. The plaintiff alleged these posts caused him reputational, economic, and emotional harm.In the United States District Court for the Northern District of Illinois, the defendants—including the former date, her parents (for allegedly allowing use of their internet connection), the group’s administrators, and Meta Platforms—moved to dismiss the complaint for failure to state a claim. The court granted the motions, finding the claims legally insufficient and dismissing the case with prejudice. The plaintiff appealed and voluntarily dismissed claims against unidentified “Jane Doe” defendants to preserve diversity jurisdiction.The United States Court of Appeals for the Seventh Circuit reviewed the district court’s dismissal. The appellate court affirmed, holding that the plaintiff failed to state plausible claims under the Illinois Right of Publicity Act because none of the defendants used his likeness for a commercial purpose. The court also found the “doxing” claim insufficient, as there were no plausible allegations of intent or recklessness regarding harm or stalking. Defamation and related claims failed because the allegedly defamatory material could be innocently interpreted or lacked special damages. The court also concluded that the appeal as to the woman and her parents was frivolous and ordered the plaintiff and his attorneys to show cause why sanctions should not be imposed for bringing a meritless appeal and for submitting briefs containing fictitious quotations and misstatements of law. The court awarded costs to other appellees and referred attorney conduct to state disciplinary authorities. View "D'Ambrosio v Meta Platforms, Inc." on Justia Law

An educational technology company was contracted by a county office of education to provide software and technology services to school districts, which involved collecting and storing various types of student data, including medical information. In 2022, the company experienced a data breach that resulted in unauthorized access to student medical records, including those of a minor plaintiff. The minor, through a guardian, filed a class action lawsuit alleging violations of both the Confidentiality of Medical Information Act (CMIA) and the Customer Records Act (CRA), claiming the company was negligent in protecting confidential medical information and failed to provide timely disclosure of the breach.The Superior Court of Ventura County granted the company’s demurrer and dismissed the case, concluding that the plaintiff failed to state a claim under either statute, as the company was not a covered entity under the CMIA or CRA and the plaintiff was not a “customer” under the CRA. The California Court of Appeal, Second Appellate District, Division Six, reversed, finding that the company fell within the scope of both statutes and that the plaintiff had alleged sufficient facts to support both claims. The appellate court also determined that the trial court erred by denying leave to amend the complaint.The Supreme Court of California reversed the appellate decision. The Court held that the plaintiff did not sufficiently allege the company was a “provider of health care” under the CMIA, nor that he was the company’s “customer” under the CRA, so no claim was stated under either statute. However, the Court clarified that under the CMIA, a breach of confidentiality occurs when medical information is exposed to a significant risk of unauthorized access or use, and actual viewing by an unauthorized party is not required. The judgment was reversed and remanded for further proceedings. View "J.M. v. Illuminate Education, Inc." on Justia Law

Congress passed the Infrastructure Investment and Jobs Act, which included the Digital Equity Act of 2021, allocating $65 billion to expand affordable, high-speed broadband access across the United States, especially in underserved areas. The Act directed the Federal Communications Commission (FCC) to adopt rules to “facilitate equal access to broadband” and prevent “digital discrimination of access” based on characteristics such as income, race, and national origin. In response, the FCC adopted a final rule that prohibited both intentional discrimination (disparate treatment) and unintentional discrimination with disproportionate effects (disparate impact), applied to a broad range of entities influencing broadband access—not just internet service providers.Numerous telecommunications and broadband industry groups challenged this rule in several federal appellate courts. These cases were consolidated in the United States Court of Appeals for the Eighth Circuit. The industry petitioners argued that the statute did not authorize the FCC to impose liability based on disparate impact, nor to regulate entities beyond broadband providers. Public interest groups intervened to defend the rule, but also argued it did not go far enough.The Eighth Circuit reviewed the FCC’s rule under the Administrative Procedure Act. The court applied the Supreme Court’s most recent guidance on agency deference and statutory interpretation, emphasizing that courts must independently interpret statutes. It found that the statutory text did not authorize disparate impact liability and that the FCC exceeded its authority by applying the rule to entities other than broadband providers. As a result, the court held that the FCC’s rule was not in accordance with law and vacated the rule in its entirety. The court granted in part the industry petitioners’ request, denied the public interest groups’ petition, and left the FCC with the ongoing obligation to adopt lawful rules facilitating equal broadband access. View "Minnesota Telecom Alliance v. FCC" on Justia Law

A group of shareholders brought a class action against a telecommunications company and its executives, alleging violations of securities laws related to the company’s merger with another entity. The plaintiffs claimed that the registration statement and prospectus for the merger contained false statements and omitted material facts about illegal billing practices known as “cramming,” which they argued were widespread, known to senior management, and impacted the company’s financial performance. The amended complaint incorporated allegations and statements made by confidential witnesses and public filings from related lawsuits, as well as affidavits from other cases, all supporting the claim of pervasive cramming practices.Initially, the Boulder County District Court dismissed the complaint for failure to plead material misrepresentations or omissions with particularity and denied leave to amend. On appeal, the Colorado Court of Appeals affirmed in part but reversed the denial of leave to amend the omissions claim based on the cramming theory, instructing that any borrowed allegations must be pleaded as facts after reasonable inquiry as required by C.R.C.P. 11. After the plaintiff amended the complaint, the district court dismissed it again, concluding that the plaintiff’s counsel had not satisfied the requirement to conduct a reasonable inquiry, as the complaint relied on allegations from other lawsuits without direct verification from the original sources or witnesses.The Colorado Supreme Court, en banc, reviewed the case and affirmed the Court of Appeals’ reversal. The Supreme Court held that under C.R.C.P. 11(a), counsel must conduct a sufficient investigation to support allegations, at least on information and belief, but the extent of the required investigation is fact-dependent. Copying allegations from related complaints does not alone violate Rule 11 provided counsel’s inquiry is objectively reasonable in context. The Court found that the plaintiff’s counsel had met this standard and affirmed the judgment below. View "CenturyLink, Inc. v. Houser" on Justia Law

A defendant accessed the internet using a publicly available Wi-Fi network operated by a local business, A&W, located near his home. Access to the Wi-Fi required users to acknowledge terms of service that, among other things, stated A&W did not actively monitor the network but could cooperate with legal authorities and disclose users’ activities in response to lawful requests. After A&W’s owner and their consultant noticed suspicious activity flagged by their firewall, they informed law enforcement, which then directed A&W to monitor and log the defendant’s internet activity for approximately one year. This surveillance included tracking over 255,000 webpage visits and collecting packet capture data. Information obtained through this monitoring led to the defendant’s identification, arrest, and conviction on charges of encouraging child sexual abuse.The case was first heard in the Lane County Circuit Court, where the defendant moved to suppress evidence obtained from the year-long monitoring. The trial court found A&W’s owner and consultant acted as state agents but ruled that the defendant had no protected privacy interest in his use of the public Wi-Fi network, and denied the suppression motion. After a stipulated facts trial, the court convicted the defendant. On appeal, the Oregon Court of Appeals affirmed, holding that the defendant did not have a constitutionally protected privacy interest in his internet browsing activities on the public network under the circumstances.The Supreme Court of the State of Oregon reversed the decision of the Court of Appeals in part, and reversed the judgment of the circuit court, remanding the case for further proceedings. The Supreme Court held that under Article I, section 9, of the Oregon Constitution, a person retains a right to privacy in their internet browsing activities even when accessing the internet via a public network, and that acknowledging terms of service like those present did not eliminate that privacy right. The year-long warrantless monitoring constituted a “search,” and the State failed to justify the lack of a warrant. View "State v. Simons" on Justia Law

Several major music copyright owners, including a leading entertainment company, sought to hold an Internet service provider responsible for copyright infringement committed by its subscribers. The service provider, which serves millions of customers, was notified by a monitoring company of over 160,000 instances where its subscribers’ IP addresses were linked to alleged copyright violations such as illegal music file sharing. Although the provider had policies prohibiting infringement and took steps such as issuing warnings and suspending service, the copyright holders argued these measures were inadequate and brought suit seeking to impose liability on the provider for continuing to serve known infringers.The case was tried in the United States District Court for the Eastern District of Virginia. There, the jury found in favor of the copyright owners on both contributory and vicarious liability, and determined the provider’s infringement was willful, awarding $1 billion in statutory damages. After the District Court denied the provider’s post-trial motion, the United States Court of Appeals for the Fourth Circuit affirmed the finding of contributory liability, reasoning that supplying a service with knowledge it would be used for infringement was sufficient. The Fourth Circuit, however, reversed as to vicarious liability and remanded for a new determination of damages.The Supreme Court of the United States reviewed the case concerning contributory liability. The Court held that a service provider is contributorily liable for a user’s infringement only if it either induced the infringement or provided a service tailored for infringement. Because the provider neither encouraged infringement nor offered a service primarily designed for infringement—since Internet access has substantial lawful uses—the provider was not contributorily liable. The Supreme Court reversed the Fourth Circuit’s judgment on contributory liability and remanded the case for further proceedings. View "Cox Communications, Inc. v. Sony Music Entertainment" on Justia Law