Federal Court Rules Nationwide Lawsuit against Cingular/AT&T for Overcharges, Poor Cell Phone Service May Proceed
A class action lawsuit charging that millions of cell phone users were misled and overcharged when Cingular merged with AT&T Wireless in 2004 may go forward, a federal court ruled on May 26.
In a victory for consumers nationwide, the U.S. District Court for the District of Washington in Coneff v. AT&T struck down a clause in AT&T’s contract that the company argued allowed it to force its customers to bring their claims individually in arbitration proceedings, rather than in a class action in court. The District Court held that without a class action, the vast majority of AT&T’s customers would never obtain justice—and for that reason refused to enforce the contract provision.
Cingular bought AT&T’s cell phone system in October 2004, after assuring federal regulators that the merger would be “seamless.” But, the lawsuit contends, instead of providing the new and improved services it promised AT&T customers, Cingular immediately began dismantling and degrading the AT&T network, forcing AT&T customers to move to Cingular’s network. That meant buying new phone equipment, moving to higher cost plans, and, in some cases, an $18 “transfer” or “upgrade fee.” Some customers who tried to go to another company were hit with “early termination fees” of $175. Others who didn’t want to pay or couldn’t afford the termination fees were stuck with riding out their contract with AT&T Wireless while suffering poor to no reception – and paying an extra monthly fee of $4.99. Cingular ultimately shut down the former AT&T network. Cingular later changed its corporate name to AT&T.
Read the Court’s Decision in Coneff v. AT&T.