AT&T Lawsuit: $60 Million Settlement Over Misleading Unlimited Data Claims
A staggering $60 million - that's what AT&T agreed to pay in the landmark AT&T lawsuit settlement that shook the telecommunications industry. We've witnessed one of the most significant cases of misleading advertising practices in recent years, where AT&T's promise of unlimited data wasn't exactly what customers signed up for.
The controversy centers around AT&T's unlimited data plans and their data throttling practices that affected millions of customers. The telecommunications giant faced serious allegations of reducing data speeds for customers who exceeded certain thresholds, despite marketing their plans as "unlimited."
Understanding the AT&T Data Throttling Controversy
The controversy began in 2011 when AT&T implemented significant restrictions on their unlimited data plans. We found that despite marketing these plans as "unlimited," AT&T would drastically reduce data speeds once customers reached certain thresholds - as low as 2-3 gigabytes of data usage.
The impact of this throttling was severe and widespread. When customers exceeded their threshold, AT&T would reduce speeds by up to 90 percent, making basic mobile activities nearly impossible. Here's what customers experienced:
Web browsing became frustratingly slow
Video streaming services were practically unusable
Basic mobile applications struggled to function
What made this practice particularly concerning was its implementation. The throttling occurred 24 hours a day, regardless of network congestion, with speeds dropping to as low as 128kbps. We discovered that affected customers typically experienced throttling during an average of 7.5 monthly billing periods, effectively paying $225 for "unlimited" data during months when their service was severely restricted.
The technical reality of AT&T's data management revealed a distinction between throttling and deprioritization. While deprioritization occurs when networks are congested, AT&T's throttling was a deliberate speed reduction that kicked in automatically after reaching data thresholds. This practice continued until 2014-2015, when AT&T finally modified its approach to only throttle during actual network congestion.
Legal Battle and Settlement Details
Following extensive legal proceedings, we've seen the Federal Trade Commission secure a significant $60 million settlement with AT&T in 2019. The settlement addressed the company's controversial data throttling practices that affected millions of customers.
We can report that AT&T has already distributed $52 million through bill credits to current customers and refund checks to former customers. Currently, approximately $7 million remains in the settlement fund for eligible customers who haven't yet received compensation.
The settlement has reached a substantial number of affected customers, with 267,734 former AT&T customers receiving payments totaling nearly $6.3 million. Individual compensation amounts varied between $10 and $23, depending on the customer's state of residence.
For those still eligible, here are the key qualification requirements:
Former AT&T customer with an unlimited data plan between October 1, 2011, and June 30, 2015
Experienced data throttling
Haven't received previous compensation from AT&T
We've observed that the FTC has streamlined the claim process, offering both digital and traditional methods. The commission has distributed 212,893 checks and 54,841 PayPal payments. For those seeking to file a claim, the FTC maintains an online claim portal, with additional support available through their dedicated hotline at 1-877-654-1982.
Conclusion
This AT&T lawsuit settlement has reshaped standards for transparency and fairness across the telecommunications industry. Our investigation revealed how millions of customers suffered from severe data throttling despite paying for "unlimited" plans, leading to the substantial $60 million settlement that holds AT&T accountable for its misleading practices.
The case's ripple effects extend far beyond monetary compensation. Major wireless carriers must now provide clear disclosures about data restrictions and throttling policies. These changes protect vulnerable consumers, especially the 27% of low-income households relying primarily on mobile internet access.
The settlement's success, demonstrated through $52 million already distributed to affected customers, proves the effectiveness of regulatory oversight in protecting consumer rights.