A Great Victory: An iPhone User Wins $850 In AT&T Throttling Case

Posted on Mar 1 2012 - 11:11am by CONTRIBUTOR

Editor’s Note: Guest Author Ruchika Shokeen is a technology enthusiast interested in analysing and reporting about different technologies.

Matt Spaccarelli, an unemployed truck driver and student, took the country’s largest telecommunications company to small claims court when AT&T started slowing down the data service for his iPhone, Pro-tem Judge Russell Nadel found in favor of Spaccarelli in Ventura Superior Court in Simi Valley on Friday, saying it wasn’t fair for the company to purposely slow down his iPhone, when it had sold him an “unlimited data” plan.

Judge in Simi Valley awarded Matt Spaccarelli $850 after finding that AT&T had choked data on his iPhone even though his contract promised unlimited downloading. Other Americans are acing same problems and some reports say they are also in a position to cash in. AT&T isn’t alone in throttling data usage.

Verizon has a form of throttling called “data optimization” that went into effect last fall. Data optimization differs from throttling, the company explains, because it’s based on network traffic. So if you’re a top tier user and you’re near a congested data node, you may experience a slowdown, but if you’re not near a congested node, your data speed could be normal.

The customer was being throttled after using at least 1.5 gigabytes — that’s 1,500 megabytes, or enough to watch 13 hours of streaming video, according to AT&T’s data calculator. AT&T is completely unfair to sell an unlimited data plan to Mr. Spaccarelli and then bury terms in its contract claiming the right to reduce data speeds. An AT&T spokesman told the A.P. that the company was evaluating whether to appeal the decision.

To stop this, the company will likely go all out to shut down Spaccarelli as a way to deter others. The phone giant could, in theory, also seek to amend its Customer Agreement by eliminating the small claims court option, and forcing all claims into arbitration (which would also make it easier to keep legal setbacks out of the media). AT&T’s “no class action” rule helped to stifle consumer lawsuits, but a wave of small claims filings could open a new can of worms. The bottom line is that new lawsuits are for now likely to be a trickle rather than a flood. This could change if Spaccarelli wins the appeal.

AT&T is facing many upcoming Complaints that customers have had about throttling. Few weeks back, John Cozen, an AT&T customer, published a blog post documenting his experience with being throttled after using 2.1 gigabytes of data, Mr. Spaccarelli’s story is similar to others. Mr. Spaccarelli’s victory could open the door to more small-claims cases to come.

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