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Canadians File Class Actions Over Incoming SMS Fees

Posted by kdawson on from the unilaterally-changing-the-locked-in-contract dept.

dontmakemethink writes "CTV reports that over the last couple of weeks class-action lawsuits have been filed against two major Canadian cellular service providers, Bell and Telus, for imposing fees on incoming text messages. While there has been very vocal opposition to the introduction of the fees, those who cannot change providers due to binding contracts feel the situation is actionable in court. Some of those not bound by contract, such as myself, have given their service provider notice that they will charge the provider for having to contact them to have charges reversed for unsolicited texts. Because service providers are aware of the volume of unsolicited texts, we feel they are liable for the inconvenience to their clients for preventing spam charges, and more importantly under no circumstances should service providers profit from spam. We also feel that requiring us to buy text bundles to avoid the inconvenience of reversing spam charges constitutes extortion. They can charge me for texts when they stop the spam."

16 of 292 comments (clear)

  1. Rather unjustifiable reactions? by William+Ager · · Score: 5, Interesting

    I can understand how this might be a breach of contract issue for customers with binding contracts, and I would certainly expect many customers, even without binding contracts, to cancel their service over this. However, I really can't see how a customer can consider themselves justified in arbitrarily billing a company for their time just because the company makes changes that they dislike, no matter how horrible those changes may be.

    1. Re:Rather unjustifiable reactions? by William+Ager · · Score: 5, Interesting

      If the matter is breach of contract, then it should be dealt with accordingly. There are mechanisms in society to deal with these sorts of issues, and they don't involve billing people without legal justification.

    2. Re:Rather unjustifiable reactions? by William+Ager · · Score: 2, Interesting

      People being held liable for unsollicited traffic they cannot control is criminally absurd, and if their regulatory bodies refuse to crush it in the womb, then I say billing phone companies for their time is an excellent proactive demonstration of, and against, that absurdity.

      And how, pray tell, is the sending of such bills going to change anything? The company doesn't need to pay them, and the customers are still paying just as much; there really isn't anything to motivate the companies to care about the bills at all. If the customers were deducting the amounts from their phone bills, it might make a bit more sense as a form of protest.

    3. Re:Rather unjustifiable reactions? by Anonymous Coward · · Score: 2, Interesting

      Er, prisoner's dilemma shouldn't work like that. Instead, it indicates that one company should snitch and capture a larger market at the expense of its co-inmates.

      I suspect that an action as absurd and anti-customer as this being implemented by two companies at the same time indicates collusion, something the Prisoner's Dilemma doesn't allow.

      Of course, collusion is possible through the action itself. The first company to do it could find themselves vulnerable to class-actions from stockholders though, for having not acted to increase profits.

    4. Re:Rather unjustifiable reactions? by HadouKen24 · · Score: 4, Interesting

      Actually, that is how the Prisoner's Dilemma works.

      There are basically two versions: one in which it only happens once, and the iterated dilemma, in which the prisoners are going to have to deal with dilemma over and over again.

      In the iterated version, altruistic strategies tend to work much better. That is, it will tend to your benefit NOT to screw over the other guy. Assuming that all prisoners act rationally, there will usually be relatively few confessions, though this only works if the exact number of iterations is unknown to the prisoners.

      The iterated version much more closely resembles telecom competition. The companies are going to have to "compete" for some time. It's to their benefit to behave most of the time in ways that look like cooperation, even if there is no actual collusion. If both companies adopt strategies of cutthroat competition, then they'll get much slimmer profits than if they don't. Given that they both understand this, and they are both (relatively) rational actors, they will be reluctant to set off a cycle that might lead to drastically lower profit.

    5. Re:Rather unjustifiable reactions? by Anonymous Coward · · Score: 5, Interesting

      Your responses suggest this is yet another case of the Land Of The Fee making some people more equal than others.

      When issuing a complaint to a firm in the UK, giving them a price list and then billing them for each letter you send (time to write, cost of postage) is well-known technique. If it comes to taking the firm to (usually) small claims court, these amounts may then be awarded as part of your win. And, contrary to all the "oh but they'll never pay" negativity, once you've won your case, if they don't cough up, the court gives permission to send bailiffs round and adds the cost of debt collection and wasting the court's time to the amount they owe. What often happens, if you're claiming a small amount and it's a big firm, is that they don't even turn up and you win by default - if the big guys refuse to swallow their pride and pay up immediately, it's instant tabloid press fodder.

      So anyway, it's all part of increasing the risk for the firm if they fight you. It increases the likelihood that they acquiesce, content with the 95% who bend over and take it. Surely Canada, more recently severed from the motherland, gives its subjects similar recourse?

    6. Re:Rather unjustifiable reactions? by Anonymous Coward · · Score: 2, Interesting

      Allow me to chime in about The Netherlands, being blissfully ignorant of the legal situation in Canada: if a company/partner unilaterally changes the terms of contract, the contract can be declared void through the regular judicious channels (you do have to file for that, it is not an automatic cancellation).

      However, any costs you incur through said changes are 100% recuperable, up to the point where you can send the company an invoice for billable hours.

      So if my CPP started charging me for the number of texts I receive, and I'd have to phone them to correct the situation, I could send them a legally binding invoice for the following:

      - the amount they overcharged me
      - the phone costs I had to make calling them
      - €35 for every (part of an) hour that I had to deal with their actions
      - interest rates (most judges will agree with interest starting 2 weeks after the first invoice/notice)
      - any legal costs I incur due to their non-compliance

      (side note: look below to see where I posted about the same proceedings apply in the UK)

    7. Re:Rather unjustifiable reactions? by jcrousedotcom · · Score: 2, Interesting

      Actually, self regulation, when there is (apparently - I don't live in Canada, so I am just going on what those that live there are stating) no competition does not work. If the consumer had a choice - they'd tell this company to pound sand and switch to a provider that seemed more interested in their customers.

      I have always used this analogy regarding the local land line provider but in Canada it apparently applies for the cell companies too:

      We don't care, we don't have to. We're the phone company.

      --
      Illiterate? Write for free help!
  2. What a rip by Brain+Damaged+Bogan · · Score: 3, Interesting

    I'm glad this sort of shit doesn't happen in Australia, only the sender of an SMS/phonecall gets charged here

    --
    -- Sex is the antonym of pringles. Once you pop it's time to stop.
  3. Contracts? by p0tat03 · · Score: 5, Interesting

    Correct me if I'm wrong... but aren't contracts breakable without termination charges if the service provider changes the contract? There's a time limit on this, but it's fairly generous. I know people who got out of their Bell/Telus contracts recently precisely BECAUSE of the SMS fee.

    Now, the fact that all the wireless providers in Canada are dirty crooks is another story altogether. Quitting your contract won't help much, you'll just get gouged somewhere else.

    I think Canadian telecom (and to a lesser extent in the US) is proof solid that a laissez-faire approach to regulation and the institution of "free market" principles in an industry where the government GUARANTEES monopoly (via last mile, etc.) simply doesn't work.

    Jim Prentice is a corporate crony who should be kicked out of office, preferably thrown in jail for so blatantly selling out the Canadian people's interests. His broken-record touting of "free market will be best" on the telecom issue is laughably absurd for anyone who's had to pay a phone bill in the last 10 years. What a change the Conservative government has brought us. Now instead of the Liberals selling out the Canadian people little bits at a time under the table, the Conservatives are having a firesale blowout with no regard for public opinion.

    1. Re:Contracts? by Carewolf · · Score: 5, Interesting

      Such a clause in a contract is natually invalid. You can not agree to unspecified or future terms, in a contract you only agree to specified a terms, and specifying unspecified terms is not magic loophole any court accepts.

  4. Yes and no. by Chrisq · · Score: 2, Interesting

    Yes, if you want to change a contract you have to start a new one. This either means continuing the old one for its duration, termination by mutual agreement or more commonly by invoking a "we may terminate any time..." clause.

    Very often in practice however companies lawyers will have put a lot of small print in, saying things like "we can vary our charges and basis for charge at any time". This means that they can change the parameters of an existing contract without terminating.

    The changes may or may not be legally enforceable. Usually changes in line with inflation, etc. are considered OK but in cases like this it is not clear, hence the class action suit.

  5. Time to ditch SMS? by knarf · · Score: 2, Interesting

    SMS has been and will be milked until the cow is not just dry but parched. The difference between actual cost and price of SMS is ludicrous. And as that actual price only goes down, why to they raise the price to the customer (I know, because they can...)?

    Most modern phones can do GPRS or better... which, even though still overpriced, is quite a bit more affordable per bit than SMS. IM clients are available for many phones. Cost per message is radically lower, messages can be longer... What is missing? What would need to be added/removed to turn an IM client into a substitute for SMS so we can finally put that tired old cow to pasture?

      - it needs to start when the phone is turned on
      - it would be nice if the addressing scheme was compatible with phone numbers
      - it would need to keep open a data connection...
      - ...without incurring onerous fees...
      - ...or draining the battery...

    Many people separate their email provider from their internet access provider, the same should be doable with mobile communications. It will be hard to make it as efficient as the provider can but that can not be helped. It is imperative to build something over which the provider has no power - other than the usual contract clauses or IP blocking antics. Those can be ignored, circumvented by using another provider or fought in court if needs be.

    --
    --frank[at]unternet.org
  6. Re:The way around this by Chrisq · · Score: 5, Interesting

    In my experience the best way is just to cross out the bits you don't like, photocopy it before sending it off and send it.

    I have only once had an "I'm sorry we cannot accept your business" response. When the mobile phone provider Orange set me a change in terms and conditions which said that accepting them would tie me in for another 12 months I crossed this out (I had already had a 12 month minimum term on sign up) and enclosed a note saying that I thought a further lock-in was unreasonable. They actually responded saying they accepted my contract on these terms!

  7. Re:(shakes head) by Bastard+of+Subhumani · · Score: 2, Interesting

    You can't be charged for incoming text if text messaging is disabled on an account.

    A rather drastic solution. Applying that logic, you can't be charged for anything if you don't have a phone. Is it really an unreasonable request to be able to recieve genuine messages but not spam - and at my own expense?

    --
    Only three things are certain; death, taxes, and apocryphal quotations - Ben Franklin.
  8. Re:(shakes head) by Skye16 · · Score: 2, Interesting

    Because I can't stand talking to you. Telephones are for emergencies of the catastrophic sort only, e.g. "I'm on fire, please send help", "Wife is in the emergency room with a burst appendix", etc.

    If it's anything less important than that, then you're a dick for using the phone.