The FCC recently reached a $5.25 million settlement with AT&T to resolve investigations into two 911 service outages that resulted in thousands of failed emergency calls. This edition of Full Spectrum’s series on FCC enforcement discusses the unexpected settlement and its implications on carrier network practices and the FCC’s enforcement priorities. Partner Steve Augustino and

On June 28, 2018, the FCC’s Enforcement Bureau announced a Consent Decree with AT&T Mobility, LLC (“AT&T”) to resolve investigations into two 911 service outages in 2017. The outages lasted for more than five hours and resulted in approximately 15,000 failed calls. The settlement was somewhat unexpected because more than a year had passed since the FCC issued its report on the outages, which did not indicate that enforcement action was coming. The penalty levied against AT&T underscores that improving the nation’s 911 capabilities continues to be a top priority for the FCC and that outages will be met with significant fines.

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On October 13, 2016, the Federal Trade Commission (FTC) filed a petition in the U.S. Court of Appeals for the Ninth Circuit requesting a rehearing en banc of the court’s decision in the FTC’s case against AT&T alleging that the company dramatically reduced – or “throttled” – data speeds for certain customers on unlimited data plans once those customers had used a certain level of data.  A three-judge panel for the Ninth Circuit determined in August 2016 that the case should be dismissed because AT&T was not subject to an FTC enforcement action due to the company’s status as a common carrier.  As we noted in a previous blog post, this case could reset the jurisdictional boundaries between the FTC and the Federal Communications Commission (FCC) with respect to phone companies, broadband providers and other common carriers.

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On Monday, August 29, 2016, the Ninth Circuit Court of Appeals issued an opinion that may dramatically alter the boundaries between the Federal Trade Commission’s (FTC) and Federal Communications Commission’s (FCC) authority over phone companies, broadband providers, and other common carriers.  The Ninth Circuit dismissed a case that the FTC brought against AT&T over its practices in connection with wireless data services provided to AT&T’s customers with unlimited data plans.  The FTC had filed a complaint against AT&T for “throttling” the data usage of customers grandfathered into unlimited data plans.  Once customers had used a certain level of data, AT&T would dramatically reduce their data speed, regardless of network congestion.  The FTC asserted that AT&T’s imposition of the data speed restrictions was an “unfair act or practice,” and that AT&T’s failure to adequately disclose the policy was a “deceptive act or practice.”

The Ninth Circuit’s decision is the latest in a series of actions attempting to identify the jurisdiction over Internet access services and Internet-based services.  As providers and regulators have struggled to identify the proper regulations applicable to such services, the Ninth Circuit’s decision could force significant shifts by both the FTC and FCC for at least a large segment of the industry.


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Modern mobile devicesLate last month, the Federal Communications Commission (“FCC” or “Commission”) released its first enforcement action predicated on the “Lowest Corresponding Price” requirement of its E-rate rules. The LCP rules require a telecommunications carrier to offer schools and libraries communications services “at rates lower than that charged for similar services to other parties.”  The Commission’s Notice of Apparent Liability (“NAL”) proposes to fine Bellsouth (d/b/a AT&T Southeast) slightly more than $100,000 for violations of this requirement.  Surprisingly, this is the first FCC proposed fine for a violation of the “Lowest Corresponding Price” requirement, despite it being a requirement under the program since its inception nearly twenty years ago.  In this post, we take a look inside the order, with an eye toward what the FCC’s approach means for other E-rate service providers.

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iStock_000019536561LargeOn April 8, 2015, the Federal Communications Commission (“FCC” or the “Commission”) Enforcement Bureau (“EB”) reached a $25 million consent decree with AT&T over privacy and data security breaches involving its customers’ proprietary information (“PI”) and customer proprietary network information (“CPNI”) at three of AT&T’s international call centers.  Under the terms of the settlement, AT&T must implement a wide-ranging compliance plan, notify affected customers of the breach (and provide free credit monitoring services), and report any noncompliance or future breaches to the Commission.

As explained in more detail below, this settlement represents the latest in a growing trend in aggressive enforcement of the Commission’s privacy and data security rules.  As the Commission continues to find new ways to apply its rules against carriers—and begins to implement its 2015 Open Internet Order against broadband Internet access service providers—providers should take steps to bring themselves (and their vendors) into compliance.


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Modern mobile devicesOn March 31st, a federal judge in California District Court issued an Order denying AT&T’s motion to dismiss the Federal Trade Commission’s (FTC’s) lawsuit against the company concerning its advertising and business practices for its mobile wireless data plans.  This case presented an increasingly common question concerning the dividing line between jurisdiction of the FTC and the Federal Communications Commission (“FCC”) over activities of telecommunications companies.  With the order, the FTC’s case against AT&T will now move forward on the merits. 
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A Notice of Apparent Liability issued today by the Federal Communications Commission against AT&T for numerous alleged violations of microwave point-to-point license rules after a lengthy investigation by the Enforcement Bureau, but the two Republican Commissioners took the Commission and Bureau to task for failing to provide transparent factual bases and justifications for both the base violations and also the grounds for proposed upward adjustments.  Commissioner Ajit Pai made a point of concurring and Commissioner Michael O’Reilly concurred in part and dissented in part.


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On September 30, 2014, AT&T Mobility (“AT&T”) asked a U.S. District Court judge to approve a settlement agreement that would resolve a class action arising under the Telephone Consumer Protection Act (“TCPA” or “Act”).  In this case, the plaintiffs alleged that AT&T made auto-dialed calls to wireless phone numbers without receiving the prior express consent of the recipients, as required by the TCPA.  Specifically, the plaintiffs’ allegations concerned collection calls made to former customers at the wireless number provided when the account was established with AT&T.  AT&T disputed the plaintiffs’ claims, arguing that the recipients gave consent to receive these calls when they provided their phone number as the “can-be-reached-at” number for calls regarding AT&T customer accounts.  Nevertheless, according to the joint motion submitted to the court, the company has agreed to pay $45 million to settle the dispute.  This is one of the largest TCPA settlements in recent history, and continues a trend of high profile TCPA class actions.
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Earlier this week, the Federal Communications Commission released an order affirming the International Bureau’s 2009 order directing all U.S. facilities-based carriers within the FCC’s jurisdiction to stop payments to Tonga Communications Corporation (“TCC”) for termination of switched voice service (“Stop Payment Order“) on the U.S.-Tonga route. The April 7 Memorandum Opinion and Order affirmed the Bureau’s conclusion that TCC’s significant increase in its rates for terminating traffic on the U.S.-Tonga route – even if ordered by the Tongan government – and its disruption of AT&T’s and Verizon’s circuits to Tonga each constituted anticompetitive conduct that harmed U.S. consumers and were contrary to the public interest. The FCC also rejected TCC’s contention that the Stop Payment Order constituted unauthorized extraterritorial regulation of TCC on the grounds that only U.S. international carriers were subject to the order.
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