AT&T Agrees to $60M Settlement With FTC Over Data Throttling
The suit, which began in 2015, alleged that the telecommunications company slowed data speeds despite the fact that customers had purchased unlimited mobile data plans.
November 05, 2019 at 06:20 PM
2 minute read
(Photo: Shutterstock.com)
AT&T has agreed to pay $60 million to settle charges from the Federal Trade Commission that it used a network management tool to restrict the speeds of mobile data plans advertised as "unlimited."
The telecommunications giant will distribute the settlement funds to consumers who had their data speeds reduced after a certain threshold of usage, a practice known as throttling, despite purchasing an unlimited plan prior to 2015.
AT&T president David Christopher and William Ryan, the Dallas-based company's senior vice president and general counsel, signed the stipulated proposed order for permanent injunction and monetary judgment filed in the U.S. District Court for the Northern District of California on Tuesday.
AT&T's attorneys referred a request for comment to the company. In an emailed statement, an AT&T spokesperson said, "Even though it has been years since we applied this network management tool in the way described by the FTC, we believe this is in the best interests of consumers."
The order, signed by Evan Rose of the FTC's Western Region in San Francisco, also requires the company to now disclose any speed restrictions in ads for its unlimited plans.
U.S. District Judge Edward Chen, who has presided over the case for the last four years, has yet to approve the agreement.
The FTC brought the complaint against the conglomerate in 2015 with allegations that its throttling practices significantly slowed customer's GPS, video streaming and web browsing applications. The complaint also claimed that AT&T's threshold for throttling unlimited plans' data speeds was as low as 2 GB per billing cycle in dense markets such as the San Francisco Bay Area and New York City.
The company was represented in the litigation by Benjamin Softness, Michael Kellogg, Kenneth Fetterman and Mark Hansen of Kellogg, Hansen, Todd, Figel & Frederick in Washington, D.C.; Ryan Sandrock of Sidley Austin in San Francisco; Brett Rosenthal of Reese Marketos in Dallas; Jeffrey Mark Tillotson of Tillotson Law in Dallas; and Peter Marketos of Reese Marketos in Dallas.
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