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User Successfully Sues AT&T For Throttling iPhone Data 166

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.'"
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User Successfully Sues AT&T For Throttling iPhone Data

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  • by Russ1642 ( 1087959 ) on Friday February 24, 2012 @05:07PM (#39152587)
    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.
  • by PatPending ( 953482 ) on Friday February 24, 2012 @05:20PM (#39152817)

    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?

  • by Anonymous Coward on Friday February 24, 2012 @05:23PM (#39152857)

    If they change the terms of the contract, you have the right to reject it and cancel your service with out paying the ETF

  • by Anonymous Coward on Friday February 24, 2012 @05:25PM (#39152905)

    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?

  • by ackthpt ( 218170 ) on Friday February 24, 2012 @05:26PM (#39152927) Homepage Journal

    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.

    The contract can say anything that isn't illegal.

    But you can't market your service as "unlimited" when it clearly isn't - that is FRAUD.

    No, that's deception.

  • by GrumpySteen ( 1250194 ) on Friday February 24, 2012 @05:30PM (#39152993)

    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.

  • by forkfail ( 228161 ) on Friday February 24, 2012 @05:31PM (#39153011)

    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.

  • by Mister Whirly ( 964219 ) on Friday February 24, 2012 @05:32PM (#39153023) Homepage
    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.
  • by Anonymous Coward on Friday February 24, 2012 @06:10PM (#39153523)

    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.

  • by eth1 ( 94901 ) on Friday February 24, 2012 @06:27PM (#39153669)

    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.

    Well... that IS in fact what happens when everyone is driving too much... The rental agency is happy to rent you a Corvette for lots of money that can do almost 200MPH, in spite of the fact that most roads are "throttled" to 30-70MPH. And if there are too many people driving, you might only get 5MPH.

  • by HapSlappy_2222 ( 1089149 ) on Friday February 24, 2012 @06:32PM (#39153715)
    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.
  • by neurocutie ( 677249 ) on Friday February 24, 2012 @07:15PM (#39154079)
    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")...
  • by GrumpySteen ( 1250194 ) on Friday February 24, 2012 @07:58PM (#39154507)

    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.

No extensible language will be universal. -- T. Cheatham