Time Warner Cable faces class action suits over modem rental fee

time warner cable faces class action suit over modem rental fee tripleplayA month after Time Warner Cable started sending out notices to New York customers that they would have to start paying a monthly fee to “rent” equipment that was already installed in their homes, the company has been hit with not one, but two, class action lawsuits fighting the decision and describing the fee as an extortion attempt.

Customers across the New York area were informed in early October that, starting October 15, they would have to pay a $3.95 monthly charge to “lease” the modems necessary for its Internet services, despite the fact that the devices were already placed in the customers’ homes (Prior to the October 15 deadline, the modems were included as part of the basic service package cost paid by customers with no specific value attached to them). If they chose to, customers were permitted to buy their own modems as replacements, but TWC pointed out that only specifically approved devices – all of which turned out to be Motorola models that were more expensive than the devices that TWC was looking to lease.

Another problem with any replacement device that customers may have looked to purchase themselves – and something that TWC did not see fit to inform customers of ahead of time – is that no alternative device can handle TWC’s “Triple Play” offering, meaning that any other modem would mean that customers would have to relinquish the phone service offered by the company in order to keep using internet and cable.

No surprise, then, that class-action lawsuits against the new charge have been filed in both New York and New Jersey courts, with customers claiming that the fee is actually illegal because it’s not covered in existing customer agreements and that they were not notified of any rate increase with the mandatory 30-day notice window. Additionally, TWC is being dinged for using “paltry postcards” to inform customers of the change.

Talking to the New York Daily News, Steven Wittels – an attorney for one of the class action suits – described Time Warner’s move as “just a scam to increase revenue,” a charge that is admittedly hard to disagree with considering the known facts. Another lawyer involved in the suits, Richard Roth, added that “You can’t do this to the little guy,” one of those things that may sound more true than it actually is. In this case, however, he may have the law on his side; TWC is being sued for breach of customer contract and consumer fraud in making this particular move, with one of the two lawsuits describing the modems as devices that the company had “typically [written] off as worthless years ago.”

When contacted about the lawsuits, a spokesman for Time Warner Cable said that the company had no comment.