iPhone User Wins $850 in AT&T Throttling Case

By Sarah Mirando | March 9, 2012

Category: Apple Class Action Lawsuit and Settlement News

By Mike Holter

When AT&T started slowing down the data service for its “unlimited data” plans last year, many subscribers were left with painfully slow smartphones and little recourse. AT&T’s data throttling began the same year that the Supreme Court upheld a clause in AT&T’s subscriber contract that prohibits customers form taking their complaints to class action lawsuits or jury trials.

That didn’t stop iPhone owner Matt Spaccarelli from fighting back, however. The unemployed truck driver and student took AT&T — the country’s largest telecommunications company — to small claims court, and won.

Pro-tem Judge Russell Nadel ruled in favor of Spaccarelli, saying it wasn’t fair that AT&T purposefully slowed down his iPhone when he was paying for an “unlimited data” plan. Nadel awarded him $850 — $85 a month for the remaining 10 months in Spaccarelli’s two-year contract. AT&T charges $10 for every extra gigabyte used over 3 gigabytes, so Nadel estimates that’s the amount Spaccarelli could be charged for using additional data.

AT&T has some 17 million customers with “unlimited data” plans who could be subject to the same throttling Spaccarelli experienced. Since AT&T forbids them from consolidating their claims into a class action lawsuit or taking them to jury trial, their only recourse is to take AT&T to small claims court or arbitration.

While arbitration and small claims court cases are cheaper and faster than jury trials, they force Plaintiffs to appear in person and prepare their own statements. Class action lawsuits are often preferred by consumers because all of the dirty work, and expenses, are handled by a law firm.

It will be interesting to see how many AT&T customers will actually follow in Spaccarelli’s footsteps and take on Goliath in small claims court. Spaccarelli was lucky, but it’s often not worth the time and expense for a recovery of a few hundred dollars.