A former legal counsel with AT&T has accused the company of deliberately overcharging poorer schools for internet service contracts, the Washington Post reported. The dispute involves a government program, called E-Rate, a decades-old initiative that pays telecommunications companies to connect schools and libraries to the internet. Companies that take part in the program can receive billions of dollars of subsidies but, at the same time, are required to charge the educational institutions the "lowest corresponding price" for its services. There are no specific rules as to what this means, but, generally, it's the lowest price the school or library can pay.

The attorney became involved after he was asked to review a suit filed against the company by an educational consultant who said some of his clients were paying far more than others for essentially the same services. After reviewing the case, the attorney concluded that the plaintiff had a point, saying that AT&T had not been complying with the lowest-price rule and that it had misled federal investigators about it. He noted, for example, that workers were not even trained to mention the rule until years after the program launched. His own review of the situation, in 2009, found that several employees who had spent more than a decade working on E-Rate deals for schools and libraries had no knowledge of a lowest-price rule, believing pricing was the responsibility of a different department. The attorney was alarmed because he had relied on the company's representations that it was in compliance with the rule, and now feared those representations were false.

The attorney has since left the company and sued. AT&T, for its part, says the case has no merits and added that he had a negative performance review right before he left, but the attorney suggested it was retaliation for raising his concerns. The case itself, said the Post, will hinge on whether he is viewed as a whistleblower or as an attorney who violated his duty to a former employer.