'Unlimited' Cellular Data Throttling Investigation

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It has been alleged that a number of cell phone providers misled their customers by advertising plans for “unlimited” Internet data that was later slowed down – often to inoperable speeds. Customers are complaining that their cell phone providers are slowing down their Internet speeds without notice after using a certain amount of data in a billing cycle, rendering the devices useless for days or weeks at a time before their next billing cycle begins. At Morgan & Morgan, our lawyers investigated these claims, as we believe these customers may be able to take legal action against their providers.

Is Data Throttling Illegal?

Cell phone providers can legally throttle customers’ Internet speeds to reduce congestion during peak hours or in densely populated cities; however, the Federal Trade Commission (FTC) has said that throttling may become illegal if companies limit their customers’ Internet speeds in a “deceptive or unfair” fashion, including by calling a plan “unlimited” and later throttling – or limiting – users’ data.

AT&T Facing Lawsuit for Throttling Users’ “Unlimited” Data

In October 2014, the Federal Trade Commission (FTC) filed a lawsuit against AT&T after nearly 200,000 customers complained that the company throttled their “unlimited” data plans after they used a certain amount of gigabytes (GB) in a billing cycle.

The lawsuit alleges that:

  • Despite advertising certain data plans as “unlimited,” AT&T failed to adequately disclose that it would limit or slow down customers’ Internet speeds
  • AT&T failed to specify when customers’ “unlimited” data would be throttled
  • After a certain amount of data (ranging between 3 and 5 GB) was used, AT&T would slow down Internet speeds
  • Most “unlimited” data customers were not notified by text message or email when they were approaching the data usage threshold that would result in throttling
  • “Unlimited” data customers had their Internet speeds reduced between 80 and 95 percent during throttling, which often rendered their devices inoperable for days or weeks until their next billing cycles began
  • Customers who canceled their wireless plans with AT&T after having their “unlimited” data throttled were forced to pay hundreds of dollars in early contract termination fees

According to the lawsuit, AT&T throttled its customers’ data more than 25 million times since October 2011, affecting more than 3.5 million customers. The lawsuit is seeking to stop AT&T from advertising its data plans as “unlimited” if users will be subject to reduced Internet speeds after using a certain amount of GB of data per billing period. Furthermore, the FTC is seeking compensation on behalf of customers whose “unlimited” plans were throttled and who were forced to pay contract termination fees when canceling their accounts with AT&T.

Verizon, T-Mobile, Sprint Throttle “Unlimited” Data, Customers Complain

Consumers are complaining that numerous cell phone providers are misleading their customers by advertising “unlimited” data that is subject to throttling. While some customers complain that the throttling they’ve experienced prevents them from surfing the web and checking email, others claim that the slow Internet speeds prevent them from using critical services such as GPS. Furthermore, certain “unlimited” data customers who use their data while commuting to work complain that they spend additional money for services such as Netflix and Hulu, but are prevented from using these features on their cell phones when their data is throttled.

The following wireless providers have been accused of data throttling:

  • Verizon Wireless
  • Sprint
  • StraightTalk Wireless
  • Cricket
  • Net10 Wireless
  • Solavei
  • Virgin Mobile
  • Boost Mobile
  • MetroPCS