Fears Of New Taxes On VCs May Be Overblown

Court Tells Cingular It Can't Deny Lawyers Chance To Make Money

from the how-dare-you dept

Fri, Jul 13th 2007 5:15pm — Carlo Longino

The Washington state Supreme Court has ruled that a class-action lawsuit against mobile operator Cingular (now called AT&T) can proceed, despite a clause in the contracts it has subscribers sign preventing them from starting such actions. The suit in question alleges that Cingular overcharged some customers in the state for some roaming and long-distance calls, with a lawyer for the customers saying they were overcharged by $1 to $40 per month. Will this help the customers recover the charges and receive compensation in line with the overcharging? That seems unlikely, since all that's really happened is the court's given lawyers a green light to pursue a paycheck.

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Filed Under: class action, overcharge
Companies: cingular

27 Comments

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Anonymous Coward, 13 Jul 2007 @ 7:27pm

So, Carlo, overcharging is OK??

WTF???
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Anonymous Coward, 13 Jul 2007 @ 7:51pm

you really have no problem with them overcharging?
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Overcast, 13 Jul 2007 @ 7:56pm

Well - realistically... If Cingular didn't abide by the terms of the contract - that would make it null and void, correct?
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my 2 cents, 13 Jul 2007 @ 8:28pm

Once again, the lawers are going to be the only winners.
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David, 13 Jul 2007 @ 9:29pm

The story doesn't condone the overcharging, just questions the effectiveness of class action lawsuits in our country.
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Abriel McPierce, 13 Jul 2007 @ 9:35pm

Beans.
The article states in a very clear way that the overcharge is not ok. Apparently all that's happening is that the courts are allowing lawyers to get money, not the people who were overcharged. That's yet to be seen.
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claire rand, 14 Jul 2007 @ 12:06am

"overcharging" as in a company that knowingly sends and incorrect bill, and when this is pointed out refuses to do anything about it.

are the US telcos run by the UK power companies?

sounds a lot like npower, who claim to have a 'policy' of not correcting errors below 500 units, and have an'issue' with my policy of not paying incorrect bills after I have left thier service, i.e. when they can't cut that service off...

as for a lawsuit.. if it comes to it don't pay the incorrect bill, inform them the bill is wrong, in writing, keep the evidence and let them start the court case? if they cut you off sue them for breach of contract?

individually, and claim costs as well. otherwise I can see people maybe getting a credit note on thier accounts, if that. these class action suits can be a good idea for somethings but for stuff like this? nah.
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me, 14 Jul 2007 @ 2:35am

funny enough, joost (the online tv service) also has a clause in the 'license agreement' that denies its users the right to a class action lawsuit against them. Anyone willing to see how that stands up in court when the spyware nature of joost is revealed ?

Look what I was presented in their license a few months ago when i was 'invited' to the beta (and no, i did not agree to that 'slavery' piece of s..t agreement.)

[...snip...]

4.1. You hereby acknowledge and agree that the Joost™ Software may be incorporated into, and may incorporate itself, software and other technology owned and controlled by third parties. Any such third party software or technology that is incorporated in the Joost™ Software falls under the scope of this Agreement. Any and all other third party software or technology that may be distributed together with the Joost™ Software will be subject to you explicitly accepting a license agreement with that third party. You acknowledge and agree that you will not enter into a contractual relationship with Joost or its affiliates regarding such third party software or technology and you will look solely to the applicable third party and not to Joost or its affiliates to enforce any of your rights.

[...snip...]
4.2.3. When installed on your computer, the Joost™ Software may periodically communicate with Joost servers and/or Joost™ Software installed by other users. Additionally, third party software installed on Your computer may periodically communicate with third party servers for the purposes described in the license agreement or privacy policy between you and that third party.

Are you fucking serious ?! Third party software may communicate with third party servers ??
isn't this the core definition of spyware ??

also:

12.8.
Governing Law; Jurisdiction; Waiver of Claims. This Agreement shall be governed by and construed in accordance with the laws of Luxembourg, without regard to conflict of law rules thereof.
[...snip...]
You further agree not to bring claims on a representative, class member basis, or as a private attorney general, and agree not to assert any claims against Joost unless such claims are asserted by you in the forum required by this Agreement no later than one year following the date that your claim or cause of action arose.

Say what ?? Any lawyer around that actually has a license to practice in Luxemburg ?? not many i think, thus lawsuits there are VERY expensive. and double WTF ... no class action lawsuits are allowed? are they nuts ?

Practically what they say is that they could install any software that claims to show a license to the user and would not install if the user says no... now where did i hear that before?? right... a ton of junk 'helpers' out there claim to behave like this but in reality they don't.

And then Joost says it's not their fault if the software they installed turns to be...let's suppose..a keylogger...

Also, that 'forum' mentioned in the license is only accessible if you agree to the 'slavery' license agreement. There is NO WAY to post messages on their so-called forum unless you agree to the stupid license agreement first, when you install the joost executables.
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Douglas, 14 Jul 2007 @ 4:52am

Re:
NO! A contract is not void because of breach! > ?
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Robert, 14 Jul 2007 @ 6:17am

Class Action
Class action lawsuits are a valuable tool when used for fighting the corporate giants. If a corporate powerhouse wants to cheat 1,000,000 consumers out of $20.00 each, the class action case will punish and/or stop them. Why do you think that the Bush sheepeople, what few there are left, HATE class action lawsuits?
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Steve R. (profile), 14 Jul 2007 @ 6:38am

Re: Class Action
Unfortunately, as Techdirt has been pointing out, class action lawsuits seldom restore the damages incurred by the consumer. Most of the time the consumer seems to get a discount coupon towards a future purchase. This is absurd because it "forces" the consumer to continue to have a business relationship with an unethical company. If the consumer stands on principle and refuses to deal with the unethical the consumer never gets reimbursed for their damages. The unethical company still keeps the money. (Might as well through in my SPRINT bad comment as I could not get a $15 credit for SPRINT's improper billing practices as we had dropped our phone service with them.)

As Techdirt is pointing out, only the lawyers really benefit.
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Steve R. (profile), 14 Jul 2007 @ 6:50am

EULAs should not be considered legal contracts
Carlo Longino wrote for this post: The Washington state Supreme Court has ruled that a class-action lawsuit against mobile operator Cingular (now called AT&T) can proceed, despite a clause in the contracts it has subscribers sign preventing them from starting such actions. While this post concerns class action lawsuits, his post also points to a bigger legal issue, the legality of EULAs. To many people, unfortunately, seem to blindly accept EULAs as being legally valid even though the effect is to strip you of all your rights. I hope that we will see more courts finding that EULAs are not valid legal documents.

PS: I am not a lawyer so my opinion is from the lay perspective.
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dicus, 14 Jul 2007 @ 7:30am

Re:
That would be nice. However, contracts like this generally include a an arbitration clause that does not allow you to sue them. You have to take your case to arbitration.

I was just included in a Belkin class action for a wireless router they overstated the throughput on. What do you think the damages were? A coupon? Nope, money back for the router. Class actions are a valuable tool when big business ripes off customers and someone catches them. This is especially true when you are forced to arbitrate your dispute. You may end up paying more in arbitration costs than the damages you get from the arbitrator. This also means you cannot go into small claims court, unless you want to try and fight the clause up to the supreme court, spending hundreds of thousands of dollars. Class actions make this feasible, because otherwise no one would be able to challenge such clauses.

The lawyers on cases like this are spending hundreds of thousands of dollars taking the case up through the appeals courts. So the customers in this case may only get a coupon, but this is important for everyone. At least in Washington state, there is now precedent for class action clauses to be invalid. That is very important. It's these types of cases that further consumer protection and advance consumer interest. Frankly, we need more of these challenges, as companies have been stretching the boundaries of contract drafting for awhile now.
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frederick092, 14 Jul 2007 @ 8:24am

Coupon arguments are a red herring
Coupon settlements are a thing of the past: under the CAFA Act, if lawyers get fees b/c they got thier clients coupons, they only get those fees in proportion to the value of the coupons which are actually redeemed. (See the 1712 in the link!!) Carlo clearly has a bug up his a** about lawyers making money. That's fine, everybody hates lawyers, but 1) class actions are a way of punishing the defendants fraud (like here, nobody can defend Cingular for overcharging its customers) and 2) the lawyers do all the work and don't get paid unless they win. People forget for every $1 Million dollars lawyers get in a case, they might lose two or three cases, so they end up working pretty hard for that money.
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Anonymous Coward, 14 Jul 2007 @ 9:20am

Re: only the lawyers really benefit
If money paid to the consumer is the only benefit that would satisfy you, then you won't be satisfied.

However, there are other benefits:
- Paying lots of money (even only) to the plaintiff's lawyers can deter bad actions in the future. That is a benefit to all their customers.
- The bad publicity can affect their future sales - another deterence.
- Perhaps the government will investigate them if enough stink is made over the lawsuit.

I could go on; but the points are that:
1) Individual consumers have zero leverage/power to affect their own treatment. Going to another supplier may get the same bad treatment - if one can even be found.
2) Doing nothing just encourages more unethical treatment.

I am not a lawyer. I am a citizen that does not like to be maltreated.

Everyone hates lawyers - until they need one. Without lawyers, who would we go to for help?
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Anonymous Coward, 14 Jul 2007 @ 9:34am

Contingency Fees
As Frederick092 says "they don't get paid unless they win".

The Contingency Fee system gives anyone, even the poorest people, access to the courts. Without it, corporations would run wild in their greed.

The Contingency Fee system also has the benefit of preventing many - but not all - bogus cases from going forward, since the lawyer can't spend his time/money on a sure loser.

The only problem is that if the case is good but the amount of the potential award is small, it's very hard to get a lawyer who will take the case for a contingency fee.

Justice for all!

(I'm not a lawyer.)
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Anonymous Coward, 14 Jul 2007 @ 9:46am

Tort reform
Tort reform = limit damages to corporations so they can keep ripping people off.

That's why big business, malpractice and other insurors, and big pharma spend so much to get it passed.

If they don't want to be sued, they should do what's right before, during and after problems happen. It's possible, you know.

Most people - even today - aren't out to sue anyone. They just want to be treated fairly, and with some level of dignity. You'd be amazed at how little it can take to clear up a bad situation. Look how well the Tylenol situation was handled, when someone poisoned some bottles. I don't remember a single lawsuit. (just my memory here)
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scate, 14 Jul 2007 @ 3:40pm

"Court Tells Cingular It Can't Deny Lawyers Chance To Make Money"

Apparently Tech Dirt thinks that companies should be free to rip off consumers as long as that theft is under the amount that would justify an individual lawsuit.

While it is true that successful class action suits can make lawyers a ton of money it is also true that companies can make a ton of money by ripping people off with impunity. Class action lawsuits are a way to hold companies accountable and the fear of them helps keep companies honest. Allowing companies to simply declare themselves above the law, as they do by mandating arbitration and then setting the rules of the arbitration (no class actions), does not encourage them to treat customers fairly or even legally.
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bay area guy, 14 Jul 2007 @ 6:54pm

corporate justice
Pray tell how many ways are there for companies to be brought to justice? Lawyers may be no better than bounty hunters but at least they are a deterrent.
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Willton, 15 Jul 2007 @ 11:49am

Re: corporate justice
Hear, hear! As a law student, I know that there can be some unscrupulous lawyers out there, but class action lawsuits do serve a good purpose: they allow non-wealthy individuals access to the courts to assert their rights. There are certainly many instances where the members of the class receive a nominal award in damages, but they can certainly serve as a deterrent to those companies that might think about swindling their customers.
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sehlat, 15 Jul 2007 @ 12:24pm

Let's see...
1. Write and impose terms of service that differ very little in their effects from the "employment" structure for immigrants from sub-Saharan Africa in the pre-1860 Southern United States.

2. Stealing a few bucks at a time from their customers, so it's not as if anybody's being *really* harmed.

3. Profit!

Do I understand your argument correctly?
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Adam, 16 Jul 2007 @ 5:29am

Re: Re: corporate justice
Yeah, every time there is a class action lawsuit that I'm a beneficiary, I get a discount coupon, or a chance to get $5 or $10 check after filling out outrageously complicated legal forms, that are obviously made this way purposely to discourage people while a bunch of layer walks away with millions of dollars. That's the good purpose I guess. I understand that they do hurt the companies involved and may serve as deterrent but I'd feel much better if the rewards for the "non-wealthy individuals" were grater and easier to claim and if the lawyers earned a lot less money on those class action lawsuits. If they make millions defending some reach jerk caught sniffing coke, that's cool with me.

A>
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BTR1701, 16 Jul 2007 @ 6:21am

Boilerplate
Regardless of how effective class action suits are in reimbursing those injured, it's refreshing to see a court actually tell one of these companies that these spectacularly biased, fine-print, boilerplate contracts (which are so pervasive that there's no way a consumer can avoid them) aren't enforceable.

The Joost example above is a perfect illustration of how ridiculous this crap has gotten. The laws of Luxembourg? Give me a damn break. And that's not even the most extreme example, either. I actually had one software agreement tell me that by using the software, I agree that any disputes I had with the company would be settled under the laws of Liberia. Liberia barely has a working government, let alone a functional court system, and is a country that's pretty much in a continual stage of constant and open armed insurrection. But if I have a problem with the software, I have to go there to sue? Sure. Why not just tell me that my disputes will be settled on Mars?

This the sort of shit these companies rountinely try and foist on the public.
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Nasty Old Geezer, 16 Jul 2007 @ 7:32am

Re: Class Action
Class actions are more about who loses than who wins. I would not sue for $20, and out of a million people maybe 10 would actually sue individually over that amount.

Without class actions, large companies could take their chances on bet that they would make a lot of money. With class actions -- if they lose, it is usually big dollars in lawyers fees (both sides) and big dollars administering the settlement.

Customers rarely win anything of significance, but the risk goes way up for the companies and helps keep them in line.
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Upset to the MAX, 7 Sep 2007 @ 11:39am

Class Actionn suite
I wish we would ban together and do the same in S. FL. After auditing my statement I promptly emailed it to the parties that be and they in turn advised me that they were unable to open my excel spreadsheet. For some strange reason (maybe new math) I've gotten charged for the same minute five times. Trying to resolve a measly $31.50 overcharge on a $510.00 bill did not get me any where. Yes I went over my 700 minutes and was charged .45 for 70 calls, the next month was no different $800.00+). Please let's unite! The reason there are multiple charges for the same minute; is contrary to their advertisement all are essentially dropped calls under 30 seconds. This by the way is their own control figure for the charging a call (as per customer DIS-service). Lucky for me my contract will expire on 10/28/2007 :)
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Anonymous Employee, 13 Jan 2008 @ 8:54pm

Cingular/AT&T Integrity
Nothing Cingular/AT&T Wireless does surprises me. At the beginning of the number portability process, the Cingular portability team was swamped with trouble tickets from customers that had been ported to Cingular that never asked to be ported, and wanted to be switched back to their original carrier immediately.

The development team that put the porting process in place for Cingular was instructed to write code that would allow a customer service rep. to take down information for potential customers inquiring about porting.

The team lead for number porting development objected on several occasions on the basis that it was unethical. The reason that it was unethical was that the inquiry process did not stop there. Hundreds and probably thousands of numbers were ported without permission, due to the FACT that inquiry information was "stored" just long enough for a batch job to run that evening which ported all of the inquiries that had enough critical information to allow a number to be ported. Yes, dear old Cingular capitalized on the confusion and activity of the new porting process to SLAM through the porting process. After the confusion settled, those tickets mysteriously waned to nothing.

I did not sign my correct name is I still work for them.
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Anonymous Employee, 13 Jan 2008 @ 8:56pm

Cingular/AT&T Integrity
Nothing Cingular/AT&T Wireless does surprises me. At the beginning of the number portability process, the Cingular portability team was swamped with trouble tickets from customers that had been ported to Cingular that never asked to be ported, and wanted to be switched back to their original carrier immediately.

The development team that put the porting process in place for Cingular was instructed to write code that would allow a customer service rep. to take down information for potential customers inquiring about porting.

The team lead for number porting development objected on several occasions on the basis that it was unethical. The reason that it was unethical was that the inquiry process did not stop there. Hundreds and probably thousands of numbers were ported without permission, due to the FACT that inquiry information was "stored" just long enough for a batch job to run that evening which ported all of the inquiries that had enough critical information to allow a number to be ported. Yes, dear old Cingular capitalized on the confusion and activity of the new porting process to SLAM through the porting process. After the confusion settled, those tickets mysteriously waned to nothing.

I did not sign my correct name is I still work for them.
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