FTC's Data-Speed Lawsuit Against AT&T Can Proceed, Appeals Court Says
27 February 2018 - 6:01AM
Dow Jones News
By Brent Kendall
A federal appeals court on Monday ruled the Federal Trade
Commission can move forward with its lawsuit alleging AT&T Inc.
misled wireless subscribers by reducing data speeds for several
million customers who thought they had purchased unlimited
plans.
The ruling by the Ninth U.S. Circuit Court of Appeals is a
notable win for the FTC because it restores the agency's regulatory
authority over large internet service providers.
The case has been watched closely since the Federal
Communications Commission rolled back its Obama-era net-neutrality
rules. The rollback meant that the FTC would be the lead agency on
any future policing of companies slowing down internet traffic. But
the FTC could have been without power to act against large service
providers if AT&T's arguments had prevailed in the Ninth
Circuit case.
In 2016, a three-judge panel on the Ninth Circuit had thrown out
the FTC's case, ruling the commission didn't have the authority to
bring a case against AT&T because of the company's status as a
common carrier.
But the appeals court withdrew that opinion and, with a larger
roster of judges participating, issued a new decision Monday that
sided with the government. The court agreed with the FTC's argument
that the lawsuit was valid because the commission was challenging
AT&T for providing mobile data services that were not part of
its status as a common carrier of traditional phone services.
The FTC's case, dating back to 2014, sought refunds for
consumers.
The FTC alleged that AT&T over a three-year period throttled
data speeds that affected 3.5 million customers. The company had
said it had implemented reasonable network management practices
that slowed speeds only to the very heaviest users whose data
consumption harmed the company's network.
Neither the FTC not AT&T immediately responded to requests
for comment.
Write to Brent Kendall at brent.kendall@wsj.com
(END) Dow Jones Newswires
February 26, 2018 13:46 ET (18:46 GMT)
Copyright (c) 2018 Dow Jones & Company, Inc.
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