A federal appeals court in California on Monday dismissed a U.S. Government lawsuit that accused AT&T of deception for reducing Internet speeds for customers with unlimited mobile data plans once their use exceeded certain levels.
The U.S. Court of Appeals for the Ninth Circuit said it reversed a lower court’s denial of AT&T’s motion to dismiss the “data-throttling” lawsuit, which was filed in 2014 by the Federal Trade Commission.
The FTC sued AT&T (T) on the grounds that the No. 2 U.S. Wireless carrier failed to inform consumers it would slow the speeds of heavy data users on unlimited plans. In some cases, data speeds were slowed by nearly 90 percent, the lawsuit said.
The FTC said the practice was deceptive and, as a result, barred under the Federal Trade Commission Act.
AT&T argued that there was an exception for common carriers, and the appeals court agreed.
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An FTC spokesman said the agency had not yet decided whether it would appeal the decision. “We are disappointed with the ruling and are considering our options for moving forward,” FTC spokesman Jay Mayfield wrote in an emailed comment.
AT&T did not immediately reply to a request for comment.