Thank the teacher for keeping him informed. Then Dad should be honest. He needs to state what he will do. (Talk to his child. Discuss with BM? Consequence he can impose?) He also needs to say that the phone is provided by BM and she controls its access on school days.

While the phone is supplied by BM and DH has no control over what happens at her home, DH does have control over the phone at his home. He can some no phone time as a consequence when his child is at Dad's home.

Yes, what notarelative said.

"Dear Teacher, thanks for letting me know about the phone.  BM pays for SS's phone, and he gets on the bus at her house, so I am unable to have any influence on whether or not he takes his phone to school.  I will, however, address this issue with him when I see him next."

Are teachers allowed to hold phones or other distractions for the duration of class?

He could say that the phone is the property of the boy's mother, but that he supports her taking the  needed steps to ensure his son is paying attention including holding the phone during class if this becomes an ongoing issue.

And.. yes.. the child generally can have a talking to and if there is regular visitation some consequences at dad's too.

Been there, only with novels.  Pre SmartPhone.

We had a PTC with the teaching team when SS was in 8th grade.  They all indicated that SS was reading novels in class.  We told them to take the book, tear in half, throw it away, take his desk, make him stand at the side of the white board at the head of the class for the rest of the term.  He hates attention and public humiliation will align his behavior instantly.  The teachers, with the exception of one, got all worked up over those suggestions. to which I answered "It is your classroom and his behavior in that classroom is  your responsibility. If you will not effectively engage in the actions required to modify his behaviors that you do not like, you don't care enough about what he is doing to fix it.  Don't worry, he will be dealt with very effectively at home. But... only you can fix his classroom behavior." 

The teacher who got it, the only male by the way, thanked us for having his back and that he would fix it in his classroom.

So, tell the teacher to take the phone, smash the phone, give the broken phone back to the Skid, then take his desk, stand his ass at the front of the classroom for the rest of the semester, dunce cap recommended, and make the behavioral position clear.

When then kid gets home have him fill haul and dump 5galbuckets of gravel back and forth across the back yard until he catches a clue. No new phone, unless of course BM wants to buy him a new one, and keep the consequences so firm that he will no longer get what he wants out of being a dumb ass in class.

Lather................ rinse.................. repeat.