Commentary

AT&T: Net Neutrality Decision Requires Court To Toss Throttling Charges

Almost as soon the yesterday's net neutrality decision dropped, AT&T vowed to appeal to the highest court in the country.

“We have always expected this issue to be decided by the Supreme Court, and we look forward to participating in that appeal," David McAtee, senior executive vice president and general counsel, wrote yesterday on the company's public policy blog.

At the same time as AT&T was publicly promising to appeal, however, it was arguing that the decision boosted its case in a separate battle -- a fight over whether the Federal Trade Commission can proceed with a lawsuit alleging that the company duped consumers by promising them unlimited data and then slowing their broadband connections.

The telecom yesterday sent a letter to the 9th Circuit Court of Appeals, calling attention to the net neutrality ruling and arguing that it shows that the Federal Communications Commission "has always had plenary jurisdiction over mobile broadband."

The company adds that the FCC's decision not to classify mobile broadband as a common carrier service before 2015 "was not an invitation to a sister federal agency to second-guess the FCC's expertise."

The net neutrality ruling, issued by the D.C. Circuit Court of Appeals, upheld the FCC's authority to reclassify broadband as a utility service and impose common carrier rules on providers.

AT&T's letter to the court marks its latest argument in a battle over whether it duped consumers by offering them unlimited data, but slowing their broadband connections to a crawl after they exceeded a cap.

From 2011 until 2015, AT&T allegedly throttled more than 3.5 million customers who exceeded monthly allotments of 3GB or 5GB, depending on their phones. (AT&T recently revised its throttling practices and now only slows down customers who exceed 22 GB in a month; the company also now only throttles those users when the network is congested.)

AT&T has asked the 9th Circuit to dismiss the case on the grounds that the FTC lacks authority to bring an enforcement action against common carriers.

U.S. District Court Judge Edward Chen in the Northern District of California rejected AT&T's argument, noting that the case centers on activity that occurred before the FCC's February 2015 decision to reclassify mobile broadband.

But AT&T maintains that the FTC lacks jurisdiction to prosecute mobile broadband providers, regardless of when the allegedly unfair conduct occurred.

The 9th Circuit is expected to grill lawyers for AT&T and the FTC about the case on Friday.

In addition to the FTC's lawsuit, AT&T also is facing a potential $100 million FCC fine for allegedly violating a 2010 rule by failing to adequately notify consumers about the throttling policies.

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