Courts Reject Tech Corporation Bans on Class Action Suits 102
Frosty Piss writes "Class action waivers included in cell phone companies' contracts with customers are invalid in Washington State because they violate the state's Consumer Protection Act, the state Supreme Court ruled Thursday. Five plaintiffs accused Cingular of overcharging customers between $1 and $40 per month in roaming and hidden charges. Cingular had an arbitration clause that required individual arbitration and prohibited class action litigation or class action arbitration. From the article: 'In another class action-related ruling issued Thursday, the high court unanimously ruled in favor of a couple that filed a class action suit against America Online, Inc., claiming the Internet provider created and charged them for secondary membership accounts that they didn't want.'"
Taking advantage of the non-tech savvy? (Score:4, Insightful)
Just a reminder... (Score:5, Insightful)
Re:Do class action suits ever benefit the consumer (Score:4, Insightful)
This is not to mention the bad publicity that comes from losing a major class action suit. That's probably where the most harm comes to a company in the long run. In this case the adage that "Any publicity is good publicity" is probably wrong as these are already well known entities. Of course the only "public" that hears about this may only be slashdot, which has the numbers to take down a server, but probably not a Fortune 500.
Re:Do class action suits ever benefit the consumer (Score:5, Insightful)
Unfortunately, this is very common (Score:5, Insightful)
Any business that forces a customer into binding arbitration in a contract can't be trusted.
Re:Anyone who gets overcharged for anything (Score:5, Insightful)
So, if you sign a cell phone contract, with a 14 day return policy, and on day 20 you get your bill and discover that they've overcharged you, you are a coward? Your options are basically:
The game is tilted against the consumer in these scenarios. And I'm glad this ruling came down the way it did. It's not right that a contract can force you to give up your legal right to seek relief in court. And before any wise-ass comes back with "then don't sign it", try living with a cell phone, credit card, phone service, bank account, etc, etc, etc. They are all doing it!
They do, by making companies think twice (Score:4, Insightful)
After all, the companies have massive legal departments, paid 24/7 access to the Congress with the ability to (re)write the laws, they can drag out even the most solidly grounded lawsuits forever through the appeals process and wait for the victim to go bankrupt with all those legal and court fees. Any individual claims that do get through all the way are likely to be small, and will not impact the profit margins at all.
Consequently, limiting class-action suits, along with court-awarded damages and restitution is a horrible idea; corporations would be able to literally kill thousands and still turn a profit!
Re:Do class action suits ever benefit the consumer (Score:4, Insightful)
If the lawyer can shoulder the time and cost, I don't mind them getting a big payout, I wouldn't hope to get much back if I only lost like 50 bucks to the corporation. Hopefully they'll change their policy and that would still help me at least.
Re:Taking advantage of the non-tech savvy? (Score:4, Insightful)
This is why I believe companies should be required to show 'total costs' in any marketing and documentation. Total costs would be described as what the customer pays at the end of the month if they don't knowingly opt-in to extras or stay within the bounds of the base package. Extras whether they are roaming, extra functionality and on should also be described in a manner where the customer does not need a degree to understand. For example:
- base fee, including 200 minutes: $20 (all taxes, and made up taxes are included in this figure)
- additional per minutes charge $0.10, I used 10 extra
- roaming charge per minute $0.20, for area X, I used 0
- total fee would be $21.00
Easy to calculate, easy to discuss. If the companies billing systems are so complicated that even your support can't understand, then there is an issue.
Re:Anyone who gets overcharged for anything (Score:3, Insightful)
Cool, I want to be cell-phone only so I don't have to deal with two numbers. Since it's my primary line, find me a pre-paid plan that's competitive. Counting nights and weekends I use about 2,500 - 3,000 minutes a month. On a post-paid plan of $39.99 (1k peak minutes/unlim n&w on T-Mobile) that's $0.013 a min for 3,000 minutes. Find me a pre-paid plan that's competitive with that.
Oh, that's right, you can't, because the pre-paid offerings are purposefully crippled to make them useless for anything but light use.
Re:Just a reminder... (Score:3, Insightful)
Let us know how that works when you get sued for breach of contract. kthxbye.
Re:Just a reminder... (Score:2, Insightful)
They also probably decided that someone who was going to bother them over every single little aspect of a contract was probably more trouble than they were worth as a customer.