https://www.theverge.com/2018/2/27/17057236/federal-judges-att-ftc-lawsuit-speed-throttling-fcc
The FTC’s lawsuit against AT&T’s throttling on ‘unlimited’ data plans will go
ahead
Federal judges rule against AT&T
Thuy OngFeb 27, 2018, 5:32am EST
A federal appeals court has ruled against AT&T, allowing the Federal Trade
Commission (FTC) to move ahead with its case against the telecommunications
company that alleges AT&T throttled data speeds for millions of customers who
purchased unlimited data plans.
The case began formally as an FTC clampdown on the way AT&T was marketing its
unlimited data plans. That then escalated to examinations about how much power
the FTC has in holding corporations to account over their practices. Though the
FTC Act gives the Commission enforcement authority over “unfair or deceptive
acts or practices,” it exempts “common carriers.” AT&T argued it is a common
carrier, and that the FTC has no jurisdiction over it, but that notion was
dismissed by the court.
The ruling was made by the Ninth US Circuit Court of Appeals and is significant
because it upholds the FTC’s regulatory authority over large ISPs even when
they provide separate carrier services as well. Common carrier services include
mobile phone or landline services.
In a court summary published, Circuit Judge M. Margaret McKeown noted:
Permitting the FTC to oversee unfair and deceptive non-common-carriage
practices of telecommunications companies has practical ramifications. New
technologies have spawned new regulatory challenges...Reaffirming FTC
jurisdiction over activities that fall outside of common-carrier services
avoids regulatory gaps and provides consistency and predictability in
regulatory enforcement
Federal Communications Commission (FCC) Chairman Ajit Pai, in a statement, also
welcomed the result. “The Ninth Circuit’s decision...reaffirms that the Federal
Trade Commission will once again be able to police Internet service providers
after the Restoring Internet Freedom Order takes effect,” Pai said. “In the
months and years ahead, we look forward to working closely with the FTC to
ensure the protection of a free and open internet.”
The FTC’s lawsuit against AT&T alleges that the telecommunications company
throttled speeds once customers hit particular thresholds such as 5GB within a
month. According to ArsTechnica, customers who passed those thresholds
experienced reduced speeds for 24 hours a day until the end of their billing
cycle each month. AT&T told ArsTechnica that the court decision “does not
address the merits of the case” and that it’s “reviewing opinion and continue
to believe we ultimately will prevail.”
The FCC killed net neutrality rules in December. AT&T did not have any further
comment.