Cell Phone Carrier Settles Lawsuit

Washington, DCAbout 70 million current AT&T mobility customers will soon receive notification that they may be eligible for a refund as part of a class action lawsuit settlement. According to Jay Edelson, lead counsel for the plaintiffs, AT&T customers will soon be able to claim refunds on charges to their cell phones between January 1, 2004 and May 30, 2008.

On June 6, the settlement received preliminary approval and a final approval hearing is scheduled for this December. Next up, Edelson is hopeful that other carriers, specifically Verizon Wireless, Sprint Nextel and T-Mobile will settle.

AT&T, the nation's top phone company's wireless unit, has stepped up to the plate by recognizing that customers should not be charged for unauthorized third party services; in this case, mobile content providers. This is how it works: mobile content--from ringtones to weather reports; from games to sports scores-- is sold by countless small companies that provide mobile content to consumers through their cellular telephones. The charges for such products appear on the consumers' cell phone bills as separate line-item charges. The carrier, such as AT&T, keeps some of the fee and passes the rest to the content provider. Many mobile content providers do not obtain consent from the consumer.

AT&T now requires customers who sign up for third-party services with recurring fees to confirm by replying to a text message. It also requires the content providers to send monthly reminders with instructions on how to unsubscribe from such services.

Meanwhile, Canadians are mad as hell with telecommunications companies in general and some MPs aren't going to take it anymore. The government recently introduced a bill to abolish the system access fee charged by cellphone providers and enact more rights for customers of telecommunications companies in general. "We're talking 21 years and billions of dollars in misleading payments. My bill will end fictitious surcharges on cellphones," said Liberal MP David McGuinty.

McGuintay first went on the cellphone warpath when his daughter's cellphone bill had more than $50 of extra charges for text messages—which she did not authorize. McGuintay then read the fine print and found the extra-charge provision in her contract and tried to end the service, to no avail. Instead, he discovered outrageous cancellation fees and on top of that, his daughter's expensive phone wouldn't work on another carrier's network. Does that sound familiar?

This Canadian bill, also known as the Telecommunications Clarity and Fairness Act, proposes the conditions of holding cellphone spectrum licences be changed "to include a prohibition against the levying of any additional fee or charge that is not part of the subscriber's monthly fee or monthly plan rate." Cellphone providers would also be required to make available with each service contract a fact sheet that discloses every service being provided and any associated costs.
Sounds like the US might want to follow suit.