AT&T has lost a case against the U.S. Federal Trade Commission over throttling its customers' mobile data plans after a certain threshold.

The wireless carrier offered unlimited data packages, but in reality once the customer went over 3 GB of 5 GB per month, AT&T began to automatically throttle the connection.

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This meant millions of unlimited phone customers were hit by poor service without AT&T even making the customer aware of the throttling. AT&T previously argued it should be allowed to manage its network from unlimited carrier contracts, but has since claimed that due to common carrier laws the FTC cannot investigate.

The argument was overruled by U.S. District Court Judge Edward Chen in Northern California earlier today, saying the FTC has the right to prosecute AT&T regardless of common carrier status.

Chen also claimed that AT&T was not defended by common carrier in the wireless business, since it still has not been reclassified by the Federal Communications Commission. The reclassification -- which affects broadband and wireless providers -- will go into effect 60 days after it's been entered into the Federal Register.

FTC Chairwoman Edith Ramirez praised the decision and stated the commission will continue to build the case against AT&T. The end result might see AT&T send millions out to customers as partial payment for the throttling that's been occurring for years now.

"We are gratified that the court concluded that the common carrier exemption does not insulate AT&T's conduct from FTC enforcement action," Ramirez said.

"We look forward to proving that AT&T's marketing of its 'unlimited' data plans was unfair and deceptive and returning money to the millions of consumers who were harmed by AT&T's action."

FCC has added bans to throttling by wireless or broadband providers, apart from times where the network needs to be managed. As the move to common carrier continues, the FCC will maintain more command over these companies, making sure they stay in line with the new rules.

AT&T did not comment on the decision, but has said it will continue to fight for its innocence.

TagsFTC, AT&T, Throttling, Net Neutrality