December 22, 2009
Comcast Corp. (Nasdaq: CMCSA, CMCSK) has agreed to pay up to $16 million to settle a class action suit stemming from its previous use of a network management system that throttled some peer-to-peer (P2P) applications.
Under terms of the settlement, Comcast will pay up to that amount, less settlement costs, to eligible Class members, according to Lexington Law Group and Scott+Scott LLP, two law firms associated with national class actions. (See Comcast Settles P2P Suit.)
The suit alleged that Comcast impaired some P2P file sharing traffic, including some used to transfer movies and audio files. The settlement is currently pending in the United States District Court for the Eastern District of Pennsylvania, according to the firms.
Comcast's old policy, which slowed down some upstream P2P connections during periods of congestion, got the MSO in hot water with consumer advocacy groups. The Federal Communications Commission (FCC) later stepped in with an order requiring the MSO to cease its contested practices by Dec. 31, 2008, or face "an immediate injunction." (See FCC Throttles Comcast.)
Comcast, which migrated all its systems to a "protocol agnostic" network management system by the end of 2008 and started the process before the FCC handed down its order, is trying to overturn the Commission's action, arguing that the FCC overstepped its authority because there was no law to violate. The FCC, under new Chairman Julius Genachowski, is trying to remedy that by codifying a new set of network neutrality rules, which include the Commission's already published Policy Statement on the matter. (See Comcast Fights FCC Net Neutrality Order , Comcast Goes 'Protocol Agnostic' Everywhere , and FCC Sets Sail on Internet Rulemaking .)
Comcast didn't confirm the dollar figure, but said it was "pleased" to reach a settlement that consolidates the class action lawsuits. "Although we continue to believe that our network management practices were appropriate and in the best interests of our customers, we prefer to put this matter behind us and avoid a potentially lengthy and distracting legal dispute that would serve no useful purpose," the MSO said, in a statement.
Comcast ended the third quarter of 2009 with 15.6 million high-speed Internet subs, representing a piece of the business that brought in $1.9 billion in revenues during the period.
Law firms tied to the case are directing eligible Comcast high-speed Internet customers (past or present) to visit this Website to register their claims, noting that they should do so only if they attempted to use Comcast's high-speed Internet services to use the Ares, BitTorrent Inc. , eDonkey, FastTrack, or Gnutella P2P protocols from April 1, 2006, through Dec. 31, 2008, and believe they were unable to share files or that process was somehow impaired. The same applies to those who believe they were unable to use Lotus Notes to send emails from March 26, 2007, to Oct. 3, 2007.
— Jeff Baumgartner, Site Editor, Cable Digital News
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