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Class Action Against AT&T’s Data Throttling Defeated

March 15, 2016 - Written By Tom Dawson

Unlimited data has often been a bone of contention for the majority of carriers and their users across the US for many years. What used to be a bargaining chip for everyone has quickly become something only the smaller networks – such as Sprint and T-Mobile – can actually deliver on. The carriers often argue that there isn’t enough spectrum to go around and networks quickly become congested. AT&T, to ease the pressures of congestion turned to throttling speeds of customers that were on unlimited data plans. These customers then took AT&T to court in a Class Action suit. Said suit has been going on for some time now, but AT&T has managed to defeat the Class Action in court just recently.

Judge Edward Chen of the US District Court in Northern California heard arguments from AT&T that customers’ contracts stated that they would need to work out disputes in arbitration, and a more appropriate place would be small claims courts. The Plaintiffs involved argued that a small claims court wouldn’t give the right amount of exposure to such an issue, and that moving their claims to arbitration would forego their First Amendment rights to “to petition a court for a redress of grievances”. Judge Chen ultimately took AT&T’s side in the case, citing the precedent set by the US Supreme Court way back in 2011, which outlined the Federal Arbitration Act preempting a Californian Law that prevented firms forcing those with complaints into arbitration.

AT&T got itself into a mess when they started throttling the speeds of customers on unlimited data plans once they had hit 3GB on 3G devices and 5GB on 4G devices. Arguably, such a practice renders an “unlimited” service no longer as such, and AT&T has been in trouble with Government Agencies in the past, and will continue to face fines. The Federal Trade Commission thought as much and sued the network for refunds on behalf of customers who paid for unlimited data plans, arguing that AT&T weren’t actually delivering such a service. Back in April 2015, Judge Chen did not side with AT&T in this case, despite Ma Bell claiming that the FTC had no business poking around in communications. The Federal Communications Commission however, fined AT&T $100 Million for their loose definition of the word “unlimited” as well.