Sprint Faces $1.2 Bln Class Action Suit

Sprint is not facing a $1.2 billion class action suit claiming its early terminal fees violate the Federal Communications Act as well as states' laws.

Telecommunications operation Sprint is now facing a $1.2 billion class action lawsuit over allegation that allege the company’s early termination fees violate both the Federal Communications Act and laws in every states. The new lawsuit has been filed by Scott Bursor, the same attorney who spearheaded a case in California against Sprint over unlawful termination fees—and won a $73 million judgement earlier this year.

Every major mobile carrier charges early termination (or cancellation) fees to users who wish to get out from under contractual service agreements before the terms expire—and nearly every carrier is facing lawsuits over the fees. Carrier argue the fees are necessary to recoup costs frm heavily-subsidized handsets used to lure consumers into mobile services. However, consumer advocates have argued for years the fees are far too steep and hinder consumers’ ability to switch between mobile operators.

The Federal Communications Commission has also indicated it might throw its hat into the termination fees arena, commenting this last summer that it was considering a plan that would mandate termination fees be reduced over the lifetime of a mobile contract, so customers ditching a service toward the end of a contract would be on the hook for less money than a user trying to back out after only a short period of service.