* Supreme Court backs FCC's system for levying fines

* Justices rebuff challenge involving SEC disgorgement

power

* Justices have been receptive in past to agency

challenges

By John Kruzel

WASHINGTON, June 5 (Reuters) - The U.S. Supreme Court in

a pair of rulings backing the power of federal agencies has

reaffirmed limits it previously imposed on government regulators

but rejected bids by challengers to push those constraints into

new territory.

The court, which has a 6-3 conservative majority, issued

decisions on Thursday in two cases that went in favor of the

Federal Communications Commission and Securities ​and Exchange

Commission. It ruled against challenges to the FCC's system for

levying fines and the SEC's broad power to recover illegal

profits using a financial remedy called disgorgement.

While the court in several major cases in recent years has

embraced challenges to the so-called "administrative state" -

the government bureaucracy that regulates many aspects of

American business and life - the justices on Thursday stood

squarely behind the authority of the two agencies.

Georgetown University law professor David Super described

the rulings as "small, largely technical wins" for the FCC and

SEC.

"These cases should be understood as the court telling

Congress and administrative agencies that, if they adhere to the

rigid limits on public regulation in its prior decisions, the

court will not come back and move the goalposts," Super said.

President Donald Trump's administration defended the agencies in

both cases.

A LOSS FOR AT&T AND VERIZON

In the FCC case, the court ruled 8-1 in favor of the agency,

rebuffing a challenge by wireless carriers AT&T ( T ) and

Verizon. The case was the latest to test whether a

​federal agency's internal enforcement arrangement violates the

constitutional right to a jury trial after the Supreme Court in

2024 curbed the power of ​in-house proceedings at the SEC in a

case called SEC v. Jarkesy.

The justices on Thursday rejected the argument by AT&T ( T ) and

Verizon that the Jarkesy ruling should dictate a similar outcome

in the FCC case.

The court did, however, underscore that financial penalties

issued by the agency, known as forfeiture orders, do not stop

​parties from bringing legal challenges to the agency's fines.

"The court didn't take the opportunity to expand the reach

of its prior decision in Jarkesy, but it also stressed that

companies have no legal obligation to comply with the FCC's

forfeiture orders until a jury weighs in," University of

Michigan Law School professor Daniel Deacon said.

Deacon said he was not surprised by the outcome or that

Trump's administration had defended the agency's power.

"The Trump administration knows that it can use the

administrative state for its own ends, and it hasn't uniformly

opposed agencies' claims to authority," Deacon said.

DISGORGEMENT AUTHORITY

The court's 9-0 ruling backing a broad reading of the SEC's

disgorgement authority buttressed one of ‌the Wall Street

watchdog agency's key powers.

At issue in the dispute was whether the agency must show

that victims suffered economic harm, also known as pecuniary

loss, before it ​can seek the surrender of illegal profits.

A defendant named Ongkaruck Sripetch had asked the court to

expand on one of its prior rulings, as he challenged a court

order issued at the SEC's request that required him to repay

more than $3 million in ill-gotten gains and interest related to

a ​financial fraud case. The 2020 ruling in a case called Liu v.

SEC limited the scope of what can be sought via disgorgement to

no more than the net profits of the conduct at issue.

On Thursday, the court said the Liu decision did not bolster

Sripetch in his challenge to the SEC.

Jose Lopez, an attorney at the law firm Dorsey & Whitney and

a former SEC lawyer, said the court's ruling "preserved one of

the SEC's most potent weapons in its enforcement arsenal."

The court has reined in federal agencies in several key

rulings.

For example, the court in recent years has formalized a

conservative legal principle, called the major questions

doctrine, that gives judges broad discretion to invalidate

executive agency actions of "vast economic and political

significance" unless it is deemed that Congress clearly

authorized them.

In another blow to federal regulatory power, the court in

2024 overturned a landmark 1984 precedent that had given

deference to U.S. agencies in interpreting laws they administer.

This doctrine, known as "Chevron ( CVX ) deference," had been long

opposed by conservatives and business interests.

Brianne Gorod, chief counsel at the Constitutional

Accountability Center, a liberal legal group that filed briefs

backing the SEC and FCC in their cases, called Thursday's

rulings a win for the regulators and "everyone who benefits from

these agencies being able to do their jobs."

"While this court has a history of favoring big business

interests and making it more difficult for federal government

agencies to do their jobs, today's decisions are a reminder that

it's not always possible to predict what this court will do,"

Gorod said.