Ninth Circuit Hears Federal Trade Commission’s Throttling Case Against AT&T
Earlier this week, the Ninth Circuit heard oral argument in AT&T’s appeal of a lower court decision to not dismiss the Federal Trade Commission’s (FTC’s) complaint alleging that AT&T misled consumers by limiting its “unlimited” data plan for mobile customers.
As we previously reported, in October 2014 the FTC filed a complaint alleging that AT&T engaged in unfair and deceptive conduct in violation of Section 5 of the FTC Act when it “throttled” mobile broadband subscribers who were “grandfathered” into the company’s unlimited mobile data plan. AT&T filed a Motion to Dismiss arguing that it is a common carrier subject to the Communications Act and thus exempt from Section 5 of the FTC Act. That Motion was denied by the lower court, which held that the common carrier exception applies only when the entity has the status of a common carrier and is engaging in common carriage activity. The court also held that the Federal Communications Commission’s recent “Open Internet” that prospectively reclassified mobile data service from a non-common carrier to a common carrier service does not remove the FTC’s jurisdiction over AT&T’s past alleged misconduct. It was this lower court denial of the Motion to Dismiss that AT&T appealed to the Ninth Circuit.