California Judge Says Early Termination Fees Illegal
Posted by Radimus on 07/30/08 in Business, Cell Carriers, Legal, Sprint
This is only for one State and the appeal in inevitable, but Early Termination Fees are a blight to consumer advocacy. They say it is to subsidize handset prices, while others say it is to lock consumers into a provider regardless of satisfaction and price gouging.
SAN FRANCISCO (AP) — The fees that cell phone carriers charge customers who break service contracts took a big hit in a California courtroom when a judge said such charges by Sprint Nextel Corp. likely violate state law.
The judge, in a tentative ruling issued late Monday, said Sprint will have to pay $18.3 million to customers who sued over the fees and credit $54.8 million to those who were charged but did not pay the fees.
The same judge is considering other lawsuits against telecommunications companies over their so-called early termination fees, which can range from $150 to $225. This month Verizon Wireless agreed to pay $21 million to settle an identical lawsuit just as trial was starting.
Alameda County Superior Court Judge Bonnie Sabraw rejected Sprint’s argument that a state court had no business deciding an issue the company said should be left for federal authorities. And while her ruling isn’t legally binding outside the state, it cut to the heart of an ongoing debate in other state courthouses and in Washington, D.C., over the fairness of the fees.
Who would have believed that a San Francisco Judge would have made a good decision? :-)
(of course it is an anti-business ruling, so perhaps that is why)
Written by Radimus · Filed Under Business, Cell Carriers, Legal, Sprint
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