Several wireless carriers hit with lawsuits over bill charges

On Behalf of | Dec 22, 2014 | Business Litigation |

Along with cellphone advancements comes a new dependency on our mobile devices to give us everything from our email to weather updates. With some third-party services, we can even receive other information such as our horoscope or a joke of the day in the form of a text message. But just like any service, these text messages cost money, which is something many cellphone customers across the nation say they were not aware of until seeing the charges on their bills.

This was the issue the Federal Trade Commission and several state attorney general’s offices addressed in a number of lawsuits that were filed against T-Mobile, AT&T and Sprint recently. As some of our Pasadena readers may have already heard, the lawsuits accused the wireless carriers of cramming, a practice in which a cellphone provider will “add charges to mobile bills from third-party companies without the knowledge or consent of subscribers.”

For carriers such as AT&T and T-Mobile the cost of litigation has been staggering. According to some sources, AT&T has agreed to pay the government $105 million to settle the case against it while T-Mobile is expected to pay $90 million.

Although Sprint agreed in November to stop charging customers for third-party services without their consent, the lawsuit against them does appear to still be pending. The company is fighting back though against the cramming accusations saying that changes to its business practices help protect its customers from fraudulent charges from third-party services by monitoring these vendors and vetting out companies that do add charges to customers’ bills.

It remains to be seen though if Sprint will argue this in court down the road or if the company will decide to settle like other wireless providers have already done.

Sources: Geek Wire, “T-Mobile to pay $90 million over bill ‘cramming’,” Blair Hanley Frank, Dec. 19, 2014, “Sprint faces federal lawsuit over illegal ‘cramming’,” Marguerite Reardon, Dec. 17, 2014

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