Hush-a-Phone v. FCC

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Hush-a-Phone v. FCC was a seminal ruling in United States telecommunications law decided by the DC Circuit Court of Appeals on November 8, 1956. Hush-a-Phone Corporation marketed a small, cup-like device which mounted on the speaking party's phone, reducing the risk of conversations being overheard and increasing sound fidelity for the listening party. AT&T, citing the Communications Act of 1934, which stated in part that the company had the right to make charges and dictate "the classifications, practices, and regulations affecting such charges." Under this regulation, AT&T claimed the right to "forbid attachment to the telephone of any device 'not furnished by the telephone company'". It is worth noting that during this era, the phones were rented from the phone company, not owned by the consumer.

The court's decision, which exonerated Hush-a-Phone Co. and prohibited further interference by AT&T toward Hush-a-Phone users, stated that AT&T's prohibition of the device was not "just, fair, and reasonable", as required under the Communications Act of 1934, as the device "does not physically impair any of the facilities of the telephone companies", nor did it "affect more than the conversation of the user".

This victory for Hush-a-Phone is widely considered a watershed moment in the development of a secondary market for terminal equipment, which eventually lead to telephone modems and the public internet.