Courts Reject Tech Corporation Bans on Class Action Suits

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.'"

Comments

Taking advantage of the non-tech savvy?

[shutupkevin]

Too many companies nowadays are taking advantage of the vast amount of population that pay money for a service that they don't completely understand. How many people actually know what all of those surcharges on their cellular/telephone/isp bills are for? I hope this ruling occurs eventually in New York as well.

Just a reminder...

[DogDude]

Just a reminder, kids. Just because you put something in a "contract" doesn't make it legal or enforceable. No need to get your panties in a bunch over the fine print in cell phone contracts, EULA's, etc.

Re:Do class action suits ever benefit the consumer

[Gman14msu]

Well while class action suits are about benefiting the customers who were wronged, it`s also about punishing the companies that are misbehaving. While each individual consumer may not gain a great sum of money, the sum for the whole group may make the company change policies.

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

[camperslo]

When the class gets paid in vouchers, the lawyers should be paid in vouchers.

Unfortunately, this is very common

[StandardCell]

Many contracts limit your ability to sue in a real court. They exist in everything from vehicle purchase contracts to fitness club contracts. The best thing consumers can do is to read the contracts, know their rights, reject contracts where such provisions can't be removed and tell the salespeople why this isn't acceptable.

Any business that forces a customer into binding arbitration in a contract can't be trusted.

Re:Anyone who gets overcharged for anything

[Shakrai]

Is either a fool or a coward.

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:

1. Cancel and pay the $175-$200 fee. Pay the overcharges or dispute them.
2. Cancel and refuse to pay the $175-$200 fee. Buckle down for a fight over your credit report that you will probably lose and higher interest rates for the next seven years.
3. Sue them.

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!