FTC files suit against AT&T for 'deceptive & unfair data throttling'

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The U.S. Federal Trade Commission on Tuesday announced that it has filed suit against AT&T, alleging that the wireless carrier's practice of promising unlimited mobile data and then throttling download speeds amounted to unfair and deceptive practices.

AT&T misled consumers by not properly informing them that their download speeds would be throttled, according to the commission. Customers who canceled their accounts as a result of the throttling were still charged early termination fees.

"AT&T promised its customers 'unlimited' data, and in many instances, it has failed to deliver on that promise," FTC Chairwoman Edith Ramirez said in a release. "The issue here is simple: 'unlimited' means unlimited."

The FTC alleges that the level of throttling has been "severe," with speed reductions reaching 80 to 90 percent of the advertised capacity. AT&T is said to have applied the restrictive policy to as many as 3.5 million consumers in the U.S.

Asked about throttling in focus groups, customers "strongly objected" to the idea, the FTC said. Some went so far as to call the practice a "bait and switch."

The complaint was filed in the U.S. District Court for the Northern District of California, San Francisco.