After Years Of Litigation, AT&T Customers Get A Measly $22 For Being Lied To Over 'Throttling'

Legal Issues

from the what-accountability-doesn't-look-like dept

Way back in 2014 the FTC sued AT&T for selling “unlimited” wireless data plans with very real and annoying limits. The lawsuit noted that, starting in 2011, AT&T began selling “unlimited” plans that actually throttled upwards of 90 percent of your downstream speeds after using just two or three gigabytes of data. AT&T spent years trying to wiggle out of the lawsuit via a variety of legal gymnastics, including at one point trying to claim that the very same net neutrality and FCC Title II rules AT&T was attempting to kill, prevented the FTC from holding it accountable.

In late 2019 AT&T agreed to a $60 million settlement with the FTC without actually admitting any wrongdoing. Consumers who were lied to and ripped off for years nabbed somewhere around $12 each. Another, separate California class action recently came to a close with AT&T agreeing to a $12 million settlement. There too, consumers are expected to get somewhere around $10 to $11 each because they likely would have seen even less after a full trial:

“The new class-action settlement says that, on average, settlement-class members exceeded the throttling thresholds during 7.5 monthly billing periods. This means customers paid AT&T an average of $225 for unlimited data in months they were throttled. Despite that, plaintiffs concluded that the $10 or $11 settlement payments are a good deal compared to what they would likely get at trial.”

Years of litigation, two major settlements, and $22 per consumer was the end result. Though lawyers wound up doing okay, grabbing their fair share of the $12 million:

“Here’s how the numbers in the new settlement shake out. Of the $12 million, $462,000 is set aside for administrative costs and up to $3 million for attorneys’ fees and expenses. The remainder would be distributed to the class, which is defined as California residents who bought unlimited mobile data from AT&T and exceeded the data usage threshold “for one or more monthly billing cycles such that the user would have been eligible for data usage slowing or deprioritization by AT&T in those billing cycles under AT&T’s network management policies.”

And this of course could have been worse had AT&T succeeded in flinging these folks toward binding arbitration, a system advertised as more effective than class actions despite being demonstrably even more lopsided and pathetic.

Wireless carriers have been advertising “unlimited” plans and then lying about their very real limits for the better part of fifteen years now. Many are still doing it and will continue to do it. Why? The penalty is always a tiny, tiny, fraction of the money earned by being misleading. The only real lesson here for AT&T is that stalling and litigation can easily blunt accountability for misleading or predatory business practices.

Filed Under: class action, fcc, throttling, truth in advertising, unlimited
Companies: at&t