AT&T has agreed to pay a class-action lawsuit involving customers who were billed for a data plan that was not unlimited. The settlement will give customers a partial refund. However, the refund is not enough to compensate all affected customers. They are still left out of pocket, as the payout is far less than what they had paid. The company has also agreed to stop marketing data plans based on speed or data usage.
- 1 The company is also agreeing to settle claims that it violated the False Claims Act by overbilling the Telecommunications Relay Services Fund.
The company is also agreeing to settle claims that it violated the False Claims Act by overbilling the Telecommunications Relay Services Fund.
The Telecommunications Relay Services (TRS) Fund is a federal program that compensates IP Relay service providers for placing calls for the hearing impaired. AT&T’s settlement will allow customers to receive a refund. While the settlement is a win for consumers, it will likely hurt the entire industry.
AT&T initially attempted to fight the complaint in court by arguing that it had already transferred its regulatory powers to the FCC when it implemented the 2015 net neutrality rules. However, last year a federal court rejected that argument and allowed the process to proceed. The settlement amount came 18 months after the complaint was filed. The FTC had hoped to settle before the end of 2014.
The FTC and AT&T initially sued the FTC in October 2014 and were granted a stay of proceedings.
The parties will now review the settlement and decide if it will include an injunction or monetary payment for consumers. Although the settlement is not final yet, past reports suggest that the settlement will include a monetary award and an injunction. Regardless of the outcome of the lawsuit, it is a significant win for consumers.
The class was divided into two groups. The first group is composed of approximately 750,000 people in California who exceeded the data threshold before AT&T implemented its congestion-aware throttling policy. This system throttled users only when the network was congested. AT&T will then pay out $10 or $11 to Group A customers. The second group of affected customers will be paid a total of $1.6 billion. But the settlement will be far from perfect.
The $60 million payment will be used to give affected consumers a partial refund.
The money will be automatically credited to their bills or sent as a check. This will mean that the affected customers won’t need to file claims. A partial refund will be given to former customers and current customers alike. However, former customers will have to wait a year or two before they receive their refund. It’s important to note that a refund doesn’t mean a full refund.
The company also has a history of denying settlement requests. Despite this, some of its customers still have complaints against AT&T. In fact, one of the cases was dismissed by the FTC in 2016. In the United States, the FTC has jurisdiction over wireless broadband. Nevertheless, the case has been appealed and will be heard again by a lower court in San Francisco. If the case is dismissed, there is a chance that AT&T may settle the lawsuit.
AT&T found additional breaches in the Philippines and Colombia.
Employees at the Philippines and Colombia call centers accessed 211,000 accounts. Additionally, AT&T has changed its unlock policy, so it no longer requires customers to provide social security numbers. This settlement has already been worth $1 billion. But, this is only the beginning. The company is working to make amends with customers who’ve been affected by this breach. This settlement is only the beginning of the case and is likely to result in a significant payout.