AT&T abandons case against throttling, will seek resolution with FTC

Gavel court room lawsuit judge
AT&T won't seek to take its case to the Supreme Court. (Pixabay)

AT&T said it will not take its speed-throttling case against the Federal Trade Commission to the Supreme Court, and will instead look to resolve the issue in negotiations with the FTC.

“We have decided not to seek review by the Supreme Court, to focus instead on negotiating a fair resolution of the case with the Federal Trade Commission,” AT&T spokesman Michael Balmoris said in a statement to The Hill.

The issue appears to signal a possible end to legal wrangling that began in 2014. That was the year the FTC filed a lawsuit against AT&T, alleging the carrier misled as many as 3.5 million customers with legacy unlimited data plans by throttling their data speeds and changing the terms of their plans. Specifically, the FTC said in some cases customers had their data speeds reduced by nearly 90%. The lawsuit alleged that AT&T, "despite its unequivocal promises of unlimited data," started throttling data speeds in 2011 for its unlimited data plan subscribers, and that the carrier has throttled at least 3.5 million unique customers a total of more than 25 million times.

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Notably, AT&T has since reinstated unlimited data plans that do include a number of stipulations: “For all data usage, customer may temporarily experience reduced speeds during times of network congestion.”

Added AT&T in its lengthy terms of service: “If you are an AT&T unlimited data plan customer, you agree that ‘unlimited’ means you pay a fixed monthly charge for wireless data service regardless of how much data you use. You further agree that ‘unlimited’ does not mean that you can use AT&T's wireless data service in any way that you choose or for any prohibited activities, and that if you use your unlimited data plan in any manner that is prohibited, AT&T can limit, restrict, suspend or terminate your data service or switch you to a tiered data plan.”

But AT&T’s four-year battle with the FTC over its throttling on its legacy unlimited data plans (those it offered prior to discontinuing its unlimited data offerings in 2010 and before it reinstated them last year) covered issues beyond simple throttling.

As The Hill noted, the FTC’s throttling case against AT&T centered on whether the agency had the ability to oversee telecommunications companies. That’s the exact issue at the center of the FCC’s recent move to rescind its net neutrality guidelines—the agency did so under the argument that the FTC, not the FCC, should oversee such issues.

Thus, AT&T’s move to abandon its case against the FTC’s jurisdiction appears to remove the prospect of potentially creating a legal loophole that would leave telecommunications companies without federal oversight.

AT&T’s position is also notable considering the company is in the process of fighting a Department of Justice lawsuit seeking to block its attempts to acquire Time Warner.