Slashdot Mirror


User Successfully Sues AT&T For Throttling iPhone Data

An anonymous reader writes "Matt Spaccarelli has won a judgement of $850 from AT&T for data throttling. From the article: 'Nadel's ruling could pave the way for others to follow suit. AT&T has some 17 million customers with "unlimited data" plans that can be subject to throttling, representing just under half of the company's smartphone users. AT&T stopped signing up new customers for those plans in 2010, and warned last year that it would start slowing speeds for people who consume the most data. In the last few months, subscribers have been surprised by how little data use it takes for throttling to kick in —often less than AT&T provides to those on limited or "tiered" plans. Spaccarelli said his phone is being throttled after he's used 1.5 gigabytes to 2 gigabytes of data within a new billing cycle. Meanwhile, AT&T provides 3 gigabytes of data to subscribers on a tiered plan that costs the same — $30 per month.'"

42 of 166 comments (clear)

  1. "We can change this anytime" EULA didn't work? by elrous0 · · Score: 5, Insightful

    It would be nice to think that rulings like this might have some effect on the traditional corporate practice of making new users sign "contracts" that basically give one party the right to change the terms any damn time they want and in any damn way they want, while giving the other party the right to pay their money and shut up. It would also be nice to think we may live in a country some day where consumer protection laws will actually be geared towards protecting *consumers* and not just the corporations who write all our the laws in the U.S., making these kind of rulings unnecessary in the first place.

    Of course, while I'm dreaming, I had may as well wish for a threeway with Katee Sackhoff and Natalie Portman in my new Ferrari.

    --
    SJW: Someone who has run out of real oppression, and has to fake it.
    1. Re:"We can change this anytime" EULA didn't work? by Huge_UID · · Score: 5, Funny

      Don't hurt your back. And watch out for the gearshift.

    2. Re:"We can change this anytime" EULA didn't work? by g0bshiTe · · Score: 5, Insightful

      If that's the case, perhaps there should be an "opt-out", where in the event the contract does change the consumer has the right to terminate the contract without fees if they so choose.

      --
      I am Bennett Haselton! I am Bennett Haselton!
    3. Re:"We can change this anytime" EULA didn't work? by Anonymous Coward · · Score: 4, Funny

      "the gearshift" is .. okay, look, we'll have this conversation when you're older.

    4. Re:"We can change this anytime" EULA didn't work? by Anonymous Coward · · Score: 2, Interesting

      It would be nice to think that rulings like this might have some effect on the traditional corporate practice of making new users sign "contracts" that basically give one party the right to change the terms any damn time they want and in any damn way they want, while giving the other party the right to pay their money and shut up.

      I don't disagree with the sentiment, but the law of unintended consequences applies as well. Suppose the law changes, making it illegal to modify a contract without active two party consent (i.e. none of this 'if you used it after we change the contract, you implicitly agree to the new rules' crap). The logical conclusion of businesses trying to make money by providing a service would be to limit contract lengths. Now, you get to sign up for a year of service (more likely 6 months) at agreed upon rates, etc., but then you would have to sign up for a new contract every year. That new contract would not grandfather unlimited data plans, and it likely wouldn't lock in your current rates. In practice, it becomes nothing more than what you already have. Throw in the fact that they would likely stop paying for your new phone every few years and the end result is more money out of pocket for little to no gain.

      In the end, if you don't like being screwed by AT&T, let Verizon, Sprint, or one of the others doing the screwing for a while. Or don't participate. I know that means effectively joining a societal lepers colony, but laws are not going to make this problem better. That's been the problem all along: something must be done, I have done something, therefore something has been done. Whenever you or someone you know says "there should be a law against this", just remember that it is likely happening because at some time, someone wrote a law that caused exactly "this" to occur.

      Typical obvious laws against murder, etc. don't follow the same rules, so all you ./ lawyers just shut the hell up and go troll foursquare for a while.

    5. Re:"We can change this anytime" EULA didn't work? by WrongSizeGlass · · Score: 2

      If that's the case, perhaps there should be an "opt-out", where in the event the contract does change the consumer has the right to terminate the contract without fees if they so choose.

      If you have the 'Unlimited' data plan your initial contract has already 'expired', but you'll lose the 'unlimited' part of it if you opt-out of your existing contract. O think it's better that AT&T have to be worried about these small, annoying lawsuits. It probably cost them more than the $850 settlement in legal fees.

    6. Re:"We can change this anytime" EULA didn't work? by fred911 · · Score: 2

      Additionally suprising is how this user got a court to hear the case. Most EULAs have a clause that forces a litigant to binding arbitration.

      It will be a long time and real costly before he sees a dime from this judgement, if ever.

      --
      09 F9 11 02 9D 74 E3 5B - D8 41 56 C5 63 56 88 C0 45 5F E1 04 22 CA 29 C4 93 3F 95 05 2B 79 2A B2
    7. Re:"We can change this anytime" EULA didn't work? by GrumpySteen · · Score: 4, Informative

      That already exists (at least in the US). Any time your provider changes the contract, read the fine print of the contract. You'll find you have a certain time period (usually 14 or 30 days) in which you can discontinue your service without any early termination fee. The person you talk to to try to end the service will generally lie and say that the clause doesn't apply to you, but ultimately the company is bound by the terms of the original contract until such time as you agree to the new contract by paying your next payment.

    8. Re:"We can change this anytime" EULA didn't work? by forkfail · · Score: 4, Informative

      They don't change the contract. t-mobile and AT&T just redefine "unlimited data" to mean "all the data you can get, but at 5% of the maximum speed that your 4G device can deliver it".

      Which may keep them in the letter of the law and contract, but absolutely not in the spirit. Especially if you take into account the inherent and explicit promises of their advertisements.

      --
      Check your premises.
    9. Re:"We can change this anytime" EULA didn't work? by Mister+Whirly · · Score: 4, Informative

      This has been successfully done many times. The law states if one party changes a contract the other party does not have to agree to the terms and may chose to cancel the original contract. Of course with cell phones that means you may not get to keep your original number which can be a deal breaker for some.

      --
      "But this one goes to 11!"
    10. Re:"We can change this anytime" EULA didn't work? by Anonymous Coward · · Score: 2, Informative

      I hate this sort of rubbish. People always think "binding arbitration" clause, with disregard that it's illegal to have "binding arbitration" as it circumvents several laws.

      Arbitration is NEVER binding. You ALWAYS have the right say you disagree with the arbitration. You will be required to go through the motions of arbitration, but that doesn't mean you have to live with the outcome. With a house I'd contracted to be built, the company declared bankruptcy while building it, I felt this was breech of contract and wanted my deposit back feeling how can I trust the build quality on a company which knows damn well won't have to honor any warranties, there was an arbitration clause, I went through arbitration, it went against me, I disagreed with said arbitration, got a lawyer and prepared to sue. The builder heard, realized they had no prayer in court, and suddenly, literally within 1 week, I had a check for my deposit.

    11. Re:"We can change this anytime" EULA didn't work? by HapSlappy_2222 · · Score: 3, Informative

      I don't like this either, actually. It would be a better solution than being stuck in the contract, surely, but I'm still inconvenienced by the changed contract. In other contractual situations (divorce, building a home, buying a car, whatever) a party that changes the contract is typically responsible for providing a damn good reason for why the change is happening in the first place, and in cases where the contract is no longer tenable, the offending party pays up. As in:

      "If either party fails, without reasonable cause, to comply with the terms of this Agreement, then the other party may give written notice requiring the default to be ended. If the default continues for 7 days after receipt of the notice then the employment of the Building Contractor may be terminated upon receipt by the defaulting party of a further written notice stating that the employment of the Building Contractor is terminated forthwith. The Building Contractor will then be entitled to payment for work carried out that is reasonable in all the circumstances of the determination, provided that the Householder may deduct reasonable expenses incurred in obtaining a new Contractor if the Building Contractor was the only defaulting party."

      Note that last line? In legalese, the "Householder" gets to take the money for a new contractor right outta the original contractor's pocket (within reason, of course).

      These "contracts" we all sign for our phones aren't really contracts, at all; that would mean that a thing of mutual benefit or interest to 2 or more parties is being officially agreed upon. If they were, AT&T, Verizon, Sprint, or whoever would owe ME money for every dropped call, EULA change, or asshole customer service rep, the fucks. But I guess there's no real reason to supply a reasonably reliable service at an agreed upon rate with a friendly smile these days. Bah.

      On the other hand, I wonder if I can start charging my print shop's customers for the bandwidth I use to send their images to my printers. It's just ripe for the picking. Hmm.

    12. Re:"We can change this anytime" EULA didn't work? by sjames · · Score: 3, Insightful

      No, it' not impossible. There exist natural limits on the connection unrelated to any imposed limitation. An honest company wishing to offer 'unlimited' service will make sure their offer is profitable at that natural limit. Meanwhile, provision is getting cheaper over time, not more expensive.

      They offered 'unlimited' with secret limits so they could take customers away from providers offering what was actually a better deal but were honest about the actual limits. They had no interest in that honesty thing.

      At this point, they should just fess up and take their lumps, but they're trying to avoid even that by driving their customers (who did nothing wrong) to 'voluntarily' abandon the unlimited plan.

    13. Re:"We can change this anytime" EULA didn't work? by SydShamino · · Score: 2

      Fraud is deception, when done intentionally and for profit. That's its definition.

      --
      It doesn't hurt to be nice.
    14. Re:"We can change this anytime" EULA didn't work? by trawg · · Score: 4, Interesting

      We went through this same shit years ago in Australia.

      ISPs started selling Unlimited* data, and hiding what the asterisk meant in T&Cs under what they called an "Acceptable Use Policy". The Acceptable Use Policy usually said something like, "you can use unlimited data up to this particular limit at which point you will be charged X/throttled/something else".

      Our consumer watchdog group, the ACCC (which IMHO is a truly excellent example of well done government regulation that works for the people) took exception to this after user complaints. I can't remember the exact details (and am too lazy to search) but the gist of it was that this was not transparent enough and not clear enough for the end users.

      The end result is that every ISP was forced to stop selling these bullshit "unlimited*" plans and required to label them accurately and concisely.

      We have quite low monthly download quotas compared to the rest of the world (I work in broadband content and regularly talk to people that struggle on 12-20GB a month because it is all that is available for them), but the plans are clearly labelled and generally very transparent and easy to understand - and while many people are still pretty pissed about the low quotas and sometimes high overage charges (especially on mobile)... the problem of getting bullshitted into an "unlimited" plan only to find out that it is not at all unlimited has all but vanished.

      I am not sure what the US equivalent of our ACCC is (FTC?) but I find it staggering that this has not brought their attention yet. Does the FTC have no teeth (seems unlikely from previous readings) or is the government just completely in the pocket of these giant telcos, or is it just user apathy/ignorance...?

    15. Re:"We can change this anytime" EULA didn't work? by Mitreya · · Score: 2

      "you can use unlimited data up to this particular limit at which point you will be charged X/throttled/something else".

      There is a big difference between "charged" and "throttled". I assume that if they ever tried to charge users for an "unlimited" plan, they would be sued much faster
      I believe the argument is that "unlimited" refers to amount of data and not the speed. You certainly can't argue that you expected "unlimited" download speed because obviously you'd be limited by the physical link capacity
      Why _does_ wireless plan cost 30/month for 3Gigs of data? It's not like other competitors are rushing in to offer something better.

  2. Can't change contract without compensation by Russ1642 · · Score: 4, Informative

    They claimed they needed to limit usage on their network, so they throttled users. What they forgot was the part where they're supposed to compensate the affected users for this.

    1. Re:Can't change contract without compensation by slapout · · Score: 5, Insightful

      If the network is so limited, they should be trying to upgrade the network.

      --
      Coder's Stone: The programming language quick ref for iPad
    2. Re:Can't change contract without compensation by Russ1642 · · Score: 4, Insightful

      Upgrading the network doesn't happen overnight. Throttling is their way of delaying the upgrade, which is acceptable if only they hadn't screwed over their customers. They should have sent out an email stating that they were throttling the connections, and they'd also have to suspend any early termination fees. To keep customers at that point they'd probably have had to reduce rates as well. I'm not saying that throttling is ok with me, just that they could have held up in court if they hadn't been greedy dicks.

    3. Re:Can't change contract without compensation by forkfail · · Score: 5, Insightful

      If the network is so limited, they should stop selling "unlimited data" and then saying that bandwidth is not the same as data (which is their core argument).

      t-mobile does the same thing, and it is absolutely false advertising. The level of deceit is amazing - they have showboat aps on their front webpage for streaming video and TV, they show ads with people watching the game in a restaurant, but if you do these things, you're going to get throttled to the point that your smartphone becomes useless.

      It's like going to an all you can eat buffet, and getting your first plate of food with no problem, but each subsequent bite of food has to be acquired spoonful by spoonful after waiting in line each time.

      Maybe instead of spending all their money on tricking customers and attempted mergers, they should, oh, I don't know, build out their infrastructure to meet the level of use that is to be expected with the products they sell?

      --
      Check your premises.
    4. Re:Can't change contract without compensation by camperslo · · Score: 4, Interesting

      They should innovate their way out of this. There are other ways to shift traffic, incentives to use or support a WiFi traffic path for others, and some advancing picking of video/music so it can be downloaded during traffic dips or via WiFi etc.
      It's simple, cheap to do, and customers can be compensated in some way for doing something. Then it's a win for all involved.

      If regulatory agencies wont help, some should sue AT&T over the continuing unjustified price bumps even for slower grade DSL. It looks like a conspiracy to make it less viable for customers to get video programming from other providers. And at the same time, the shift away from reliable copper phone services may leave some areas very vulnerable if an extended emergency hits. Boxes around town with batteries (powering optical to copper converters), and techs hundreds of miles away, can mean serious widespread downtime over a large area in an extended disaster.

    5. Re:Can't change contract without compensation by forkfail · · Score: 2

      Sure they do. When you buy a 3G or 4G device, you are buying bandwidth capability. Plain and simple.

      --
      Check your premises.
    6. Re:Can't change contract without compensation by Sancho · · Score: 5, Insightful

      False advertising--and indeed most law--involves what a reasonable person would expect. A reasonable person seeing particular speeds advertised right next to an unlimited plan does not expect the unlimited plan to be throttled. A reasonable person who signed up for an unlimited plan at a certain speed isn't going to expect that speed to suddenly decrease while other people with a limited plan are seeing the original speeds.

      Most of meatspace isn't highly technical or bound by discrete laws, and judges (particularly in small claims court) tend to favor the little guy who doesn't get paid to know the law inside-and-out. They rule based upon common when there's any wriggle room. Contract law also favors the weaker party any time there is lack of specificity.

      This is honestly not that surprising.

      That said, AT&T can almost certainly cancel this guy's service, and should do so. You don't want customers who are going to sue you.

    7. Re:Can't change contract without compensation by gl4ss · · Score: 4, Insightful

      natural throttling happens on the network without extra effort when it's transferring near it's limits.

      at&t's throttling is throttling just for the sake of being dicks, regardless of the network congestion. it's not qossing, it's just making it unfeasible for you to actually use the network to create data transfer bills for them.. you know, running torrents during the night or whatever it is that normal internet connections are used for.

      it should be noted that at&t has plenty of moolah in bank to upgrade the network, but why bother when american sheeple are happy with paying for more?(and they can use not upgrading the backbone as an excuse for mergers to get more air bandwidth).

      --
      world was created 5 seconds before this post as it is.
  3. AT&T LLC? by g0bshiTe · · Score: 2
    FTFA

    Companies with as many potentially aggrieved customers as AT&T usually brace themselves for a class-action lawsuit. But in its subscriber contract, the Dallas-based company prohibits customers from taking their complaints to class actions or jury trials. The agreement specifies that customers must go to arbitration or small claims court instead. The Supreme Court upheld that clause last year.

    Is AT&T now an LLC? How can that clause hold up?

    --
    I am Bennett Haselton! I am Bennett Haselton!
  4. If this was a car rental by Anonymous Coward · · Score: 5, Insightful

    Can you imagine if you went to rent a car that advertised unlimited mileage that had the same contractual caveats that unlimited data plans have. Your conversation with the agent might go something like this.

    "Yes you do get unlimited mileage but if you drive too much then the car will slow down and only go 5 MPH."
    "Well how much is too much?"
    "There is no set amount, it varies by how much other people are driving. It is only the top 5%"
    "Then how am I supposed to know if I am driving to much?"
    "Well there is really know way to know, just try to drive as little as possible and you should be fine."

    I don't think anyone would stand for that kind of car rental contract.

    1. Re:If this was a car rental by forkfail · · Score: 5, Insightful

      Good analogy; I like the "all you can eat buffet one" myself. The first plate is fine, but after that, you have to go to the back of a long line, and are only allowed to take a single spoonful of food back to your table. And no eating in line.

      And while you're doing this, you have to look at the posters on the walls proclaiming how yummy the food is, how much better your life is because you're eating it, and how filling it is.

      --
      Check your premises.
  5. $850 vs. $10,000 -- WTF, Judge! by PatPending · · Score: 3, Informative

    The customer contract specifies that those who win an award from the company in arbitration will get at least $10,000. Spaccarelli picked the same amount for his claim. Judge Nadel instead awarded him $85 for each of the 10 months left on his contract.

    Er, what part of contract law does this Judge not understand?

    --
    What one fool can do, another can. (Ancient Simian Proverb)
    1. Re:$850 vs. $10,000 -- WTF, Judge! by MickyTheIdiot · · Score: 5, Insightful

      The part every judge doesn't understand anymore: that people and corporations are supposed to be treated equally in court.

    2. Re:$850 vs. $10,000 -- WTF, Judge! by Russ1642 · · Score: 4, Insightful

      Going before a judge isn't third party arbitration. Is it?

    3. Re:$850 vs. $10,000 -- WTF, Judge! by Anonymous Coward · · Score: 4, Informative

      The Judge understood fine. Spaccarelli didn't go to arbitration, so why should the clause that pertains to damage awards in arbitration apply in court?

    4. Re:$850 vs. $10,000 -- WTF, Judge! by PatPending · · Score: 2

      Good point. IANAL; my understanding is: in small claims court one can't sue for punitive damages, just actual damages, so this is apparently how the judge arrived at the amount. Then again, isn't $85 greater than what he was paying per month anyway, so he must be getting some "extra" money above and beyond his actual damages, right?

      --
      What one fool can do, another can. (Ancient Simian Proverb)
    5. Re:$850 vs. $10,000 -- WTF, Judge! by Jaytan · · Score: 2

      Small claims court isn't arbitration.

  6. ISPs ... by issicus · · Score: 2

    My ISP did not upgrade my dsl speed to what a new user would get. I noticed one day while looking at their data plans that I was not getting the 3mbits I was supposed too, far from it in fact 700kbits. I had to call them and have them and tell them to increase it. I think that says a lot about the industry.

  7. A big oops for AT&T by MobileTatsu-NJG · · Score: 4, Interesting

    I have an unlimited plan on my phone and so far I have not been throttled. I also have a 2 gig plan for my iPad. Last week I subscribed to Clear, now I have a mobile wifi hotspot. In my area the coverage is pretty good and I can hook up to 8 devices up to it. As a result I am canceling my iPad data plan. In short, even though I wasn't directly affected, I am dropping their service.

    I wouldn't have even looked into Clear if they hadn't started messing with their customers.

    --

    "I like to lick butts!" by MobileTatsu-NJG (#32700246) (Score:5, Informative)

  8. Re:One of two things is happening here. by forkfail · · Score: 5, Insightful

    So, do you understand what the definition of bandwidth is? It's real simple: bandwidth = data / time

    If they lower bandwidth, they have to be either lowering data (meaning not unlimited within the constraints of 3G or 4G), or they are increasing time (which obviously is impossible).

    Furthermore, the throttling was not in the older contracts; those got changed without grandfathering. And the text concerning the redefinition of unlimited, while present, is buried pretty deep in the contract.

    Ice this cake with the sort of advertisements shown, the aps show cased (streaming video, watching the game wherever you are, etc) along with the whole push of fastest network capabilities and such, and absolutely a false picture is generated.

    You wouldn't accept an all you can eat buffet that you can only remove food from one teaspoon at a time, unless it was made abundantly clear to you before hand that this was the case. And even then, you'd look askance at anyone offering such a deal with a name like "unlimited food" or "all you can eat".

    --
    Check your premises.
  9. Re:One of two things is happening here. by prestonmichaelh · · Score: 2

    So someone with a clear head please explain, is this just bullshit whining of people who don't understand that there is no _speed_ component in the phrase "unlimited data" and it's perfectly legitimate to throttle at some point as long as it's disclosed, or is it truly AT&T advertising unlimited data at guaranteed 3g or 4g speeds?

    The problem is that, at the time these "unlimited data" plans were sold and the contracts were signed, there were no constraints (i.e. throttling). iPhones started killing AT&Ts network, so they stopped selling "unlimited data" plans and started only selling only plans with a specified amount of data and prearranged overage charges (2 GB, 5 GB, etc.)

    The people with existing "unlimited data" contracts were grandfathered in and for a time, nothing changed. Recently they have started throttling the grandfathered "unlimited data" customers, something that was never part of the original agreement. That is what everyone is so upset about.

  10. Re:One of two things is happening here. by Nexion · · Score: 2

    I think the point is that this is deceptive marketing. You maybe look at the term "unlimited data" and separate out the speed component, but most people do not. This is intentional on the part of their marketing. Otherwise they would advertise it as "unlimited data, throttled throughput" and sell far fewer contracts because of it. Whatever they bury in the contract makes it a case of bait and switch. Like taking a test drive in a Ferrari, agreeing to pay only $10,000 for it and then they put a massive contract in front of you where the fine print reads that they actually deliver a Pinto.

    True, your an idiot for thinking you were going to get a Ferrari for 10k, true you could have read every word of that contract, but in the end you have grounds to take this before a judge to rectify the situation. In the end you either get the Ferrari you test drove, or the contract nullified.

    I've had the iPhone since they came out and have an unlimited plan. I have a second iPhone on the account given to a friend as well that is not unlimited. Service is terrible. In fact saying it is terrible gives it too much credit. We've both suffered not just throttling or extreme slowness, but at times network outage in areas where we typically have connectivity.

    I've been pondering a lawsuit to end the contracts and move to Verizon. True, I wont have unlimited service, but at least I'll be getting that for which I have paid. I left Verizon because AT&T was the only game in town for iPhones. I have regretted it ever since, but only in the last three months has service been so terrible as to think worthy of showing up to court to sue them. They've ruled out class action lawsuits to allow them to conduct themselves in a manor that would cause great financial loss if the customer didn't have to show up to court.

    It's sad they didn't just upgrade their network. They say the best part of AT&T is me, but I disagree. The best part are the customer service representatives. The worst part by far is their executive management.

  11. Re:"We can change this anytime" and Sprint DOES! by neurocutie · · Score: 3, Informative

    VERY naive... witness what Sprint has done this past year... MULTIPLE changes that affect the bottomline, i.e. what the customer actually has to pay or what the customer actually gets in the way of services, discounts or equipment upgrades. HOWEVER, Sprint merely says "these changes are not "material"". They are not changes to the contract, and therefore not grounds for leaving ETF-free. Furthermore Sprint says, "if you disagree, tough. You CANNOT sue us as a class action. Your ONLY recourse is arbitration or small claims court." and the kicker "We INVITE litigation". Oh and about arbitration, Sprint change the rules as to how the arbiter is chosen: Sprint gets to choose and it chose a pro-corporate arbiter that it pays (can we say "conflict of interest")...

  12. Re:One of two things is happening here. by RightSaidFred99 · · Score: 2

    Lol, yeah. Was going to write same (seemingly obvious to me and you) reply. What in the world is he talking about? They certainly can change time (the time it takes to download shit).

  13. Re:"We can change this anytime" and Sprint DOES! by GrumpySteen · · Score: 4, Informative

    I used to have a Sprint phone under contract. They upped the monthly cost less than six months after I signed the contract and I told them to piss off. They said the change wasn't material and charged the early termination fee to my credit card. I explained the situation to my credit card company and they reversed the charge and told Sprint to piss off. Sprint pissed off and never bothered me again.

    There's nothing naive about my post. I simply refused to take "it's immaterial" as an acceptable response and I know how to deal with companies that do shit like that.

  14. Re:There's a reason why I don't get a smart phone by neonKow · · Score: 2

    That's like pulling your battery out of your laptop and throwing it away. Yes, the device will still . . . do stuff. It just doesn't do everything it's supposed to.

    Oh, and that extra functionality you're cutting out? It's one of the primary purposes of paying more money for a smaller, slower device.