FTC launches petition against AT&T ruling

James Pearce
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Regulator wants to challenge ruling which impairs its oversight of telecoms and internet service providers

The Federal Trade Commission has trying to regain powers over the common carrier exception after launching a petition to have the case against AT&T reheard.

The original case dates back to 2014, when the regulator filed a lawsuit accusing AT&T of misleading practices over throttling customer data on its unlimited plans.

The lawsuit accused AT&T of failing to adequately disclose to customers that throttling on the unlimited plans could occur, or that it could have a drastic impact on the experience of using your phone.

AT&T successfully argued against the charge, claiming it was exempt from FTC regulation due to being a so-called “common carrier” – one that provides services or goods to any company or person. Common carriers are exempt from the FTC’s regulator authority.

Originally, a judge backed the FTC stance, but following a reclassification of broadband and wireless data as a common carriers – brought in by the FTC to push through its net neutrality rules – the Court of Appeals overturned the decision.

The ruling left AT&T under the umbrella of the Federal Communications Commission instead. However, the FTC claims that if it is prevented from suing AT&T, then all phone and internet providers will be able to perform “deceptive” business practices.

While the FCC can bring actions against phone companies for alleged bad practices, it does not have the power to seek refunds for wronged customers, something the FTC can enforce.

In its most recent petition, which was filed earlier this month, the FTC claimed this gap in powers is a key flaw in the ruling and leaves “no federal agency able to protect millions of consumers across the country from unfair or deceptive practices or obtain redress on their behalf.”

“Many companies provide both common-carrier and non-common-carrier services—not just telephone companies like AT&T, but also cable companies like Comcast, technology companies like Google, and energy companies like ExxonMobil (which operate common carrier oil pipelines). Companies that are not common carriers today may gain that status by offering new services or through corporate acquisitions. … The panel’s ruling calls into question the FTC’s ability to protect consumers from unlawful practices by such companies in any of their lines of business.”