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Frontier Demands $4,300 Cancellation Fee Despite Horribly Slow Internet (arstechnica.com)
Frontier Communications reportedly charged a cancellation fee of $4,302.17 to the operator of a one-person business in Wisconsin, even though she switched to a different Internet provider because Frontier's service was frequently unusable. From the report: Candace Lestina runs the Pardeeville Area Shopper, a weekly newspaper and family business that she took over when her mother retired. Before retiring, her mother had entered a three-year contract with Frontier to provide Internet service to the one-room office on North Main Street in Pardeeville. Six months into the contract, Candace Lestina decided to switch to the newly available Charter offering "for better service and a cheaper bill," according to a story yesterday by News 3 Now in Wisconsin. The Frontier Internet service "was dropping all the time," Lestina told the news station. This was a big problem for Lestina, who runs the paper on her own in Pardeeville, a town of about 2,000 people. "I actually am everything. I make the paper, I distribute the paper," she said. Because of Frontier's bad service, "I would have times where I need to send my paper -- I have very strict deadlines with my printer -- and my Internet's out."
Lestina figured she'd have to pay a cancellation fee when she switched to Charter's faster cable Internet but nothing near the $4,300 that Frontier later sent her a bill for, the News 3 Now report said. Charter offered to pay $500 toward the early termination penalty, but the fee is still so large that it could "put her out of business," the news report said. [...] Lestina said the early termination fee wasn't fully spelled out in her contract. "Nothing is ever described of what those cancellation fees actually are, which is that you will pay your entire bill for the rest of the contract," she said. Lestina said she pleaded her case to Frontier representatives, without success, even though Frontier had failed to provide a consistent Internet connection. "They did not really care that I was having such severe problems with the service. That does not bother them," she said. Instead of waiving or reducing the cancellation fee, Frontier threatened to send the matter to a collections agency, Lestina said.
Lestina figured she'd have to pay a cancellation fee when she switched to Charter's faster cable Internet but nothing near the $4,300 that Frontier later sent her a bill for, the News 3 Now report said. Charter offered to pay $500 toward the early termination penalty, but the fee is still so large that it could "put her out of business," the news report said. [...] Lestina said the early termination fee wasn't fully spelled out in her contract. "Nothing is ever described of what those cancellation fees actually are, which is that you will pay your entire bill for the rest of the contract," she said. Lestina said she pleaded her case to Frontier representatives, without success, even though Frontier had failed to provide a consistent Internet connection. "They did not really care that I was having such severe problems with the service. That does not bother them," she said. Instead of waiving or reducing the cancellation fee, Frontier threatened to send the matter to a collections agency, Lestina said.
Basically, Frontier is letting their copper rot on the ground, but still charging everyone full freight.
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Failure to deliver a useable service should render the contract null & void. Contracts must be equitable.. I get something (internet) and you get something (money).. They don't have to be fair, but they MUST be equitable.
In many jurisdictions based on common law, this would be unenforceable on the basis that it is a "penalty clause"--a contractual clause seeking "damages" out of all proportion to any actual damages. This may be worth looking into.
I once got an ISP to wave the early termination penalty by threatening to force them to invoke the "misuse of services" cancellation. The contract was poorly written and only had an early termination penalty (in the amount of all payments due for the remainder of the multiyear contract) in the event that I cancelled, the only penalty for misuse was "immediate termination of services". Our own legal counsel agreed -- if they terminated our service, we didn't have to pay.
So I called my sales rep to cancel and he said we' d have to pay the early termination penalty. So I told him that we had a client who was ready to use the connection to send spam (which was one of the activities they prohibited), and of course the sales rep said that they'd have to terminate our service and we'd still have to pay the penalty. So I asked him to run it past his own legal department and get back to me - this ISP already had an issue with their customers sending spam.
They let us terminate early without penalty. I never did service with that vendor again, so I don't know if they updated their contracts. They are long gone now, having been acquired (and that company acquired too).
This flat out isn't true everywhere in the US, particularly in small towns.
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Or never sign a contract without reading it. Does anyone really believe the contract does not stipulate the exact early payment penalty? Of course it does.
Pleading ignorance of a contract you (or in this case, your business) is pathetic. Also, going out of business over a measly four grand is pathetic. This is nothing but a sob story trying to get a gofundme or Kickstarter or some shit like that.
One cannot help but remember the South Park episode about cable TV.
Every time some idiot yammers about how the free hand of the market will correct things, remember stories like this. Without regulation, every company will put abusive contracts in place that will force you to pay a fortune to end a contract in order to make it as difficult as possible for you to be able to choose.
Internet, meet capitalism.
Capitalism, meet internet.
What did you expect, Libertarian paradise?
My own experience is that favorable results are usually forthcoming right after telling a difficult vendor/provider that the next phone call will be to the state attorney general's office.
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To be fair, she inherited the business from her mother, so she wasn't involved. She did read the contract but it didn't specify the cancellation fee.
The story mentions that a normal consumer does have protections but that State has a rather shitty set of laws for businesses.
Or never sign a contract without reading it.
Even if you did read it, if the previous company had an effective monopoly on a service essential to your business, your choice may be to sign or close your business.
Even the courts recognize that sometimes terms of a contract are unconcionable, especially when the contract is signed out of necessity/effectively under duress.
Knowledge is how to play a game, intelligence is how to win, wisdom is knowing what game to play.
There is no doubt that the contract stated exactly what the penalty for cancellation would be. The lady didn't read it.
It's not complicated to get out of a contract when the service is unreliable. You just have to consistently take the time to report your problem. The ISP sends a truck out to the house at their expense. The problem persists, so you call in and complain and get another truck . Repeat a few more times, get a few more trucks. Eventually the problem will be fixed or it will become apparent to the ISP that they're paying more for trucks than you're paying them for service. Then you've got good grounds for cancellation with the penalties waive. You can even ask the tech to leave a note on your file that the problem is unfixable; they're the authority on the matter.
If you sever your service before you've allowed the ISP what they consider sufficient opportunity to fix the problem, then they'll stick you every time.
Note, I call this entity Citizens as that is the bulk of past and future business, although they did buy the remnants of the old Rochester Telephone business (which had been renamed Frontier Communications), but not before the interesting parts had been spun off including their internet and cell phone components -- leaving just the old local land line business -- the buggy whip part of the communications space. After acquiring Frontier, they assumed the newly acquired entity's name as their own. Needless to say, "new" Frontier brought their mostly rural landline business to the party, and have been acquiring additional tradional land line businesses frequently in rural areas -- mostly because no other communications company want anything to do with this part of the space. After all, running new copper POTS based lines, in mostly rural areas with mostly an older, poorer clientele just seems so 70's... Additionally, young people are largely mobile focused and more affluent folks are looking for faster, more reliable cable or fiber based internet services. Lastly, as people got rid of their 2nd POTS lines decades ago when dial-up internet went the way of the dodo, and gave up the only related POTS landline for a mobile phone number or maybe a cable provided VOIP line, the old POTS infrastructure is used less and less, which means no "investment" in this antiquated technology base (kind of like the abandoned railway lines with the old telegraph signaling wire, with the old cute glass insulators -- and none of which is in use anymore). So therefore, Frontier is now in the business of riding the buggy whip part of the communications business into the ground -- and DSL might as well be ISDN -- too slow, not reliable (literally running on 50+ year old copper). They have no presence in the mobile/cell part of the market, they are not a cable company nor have they made any significant investments in fiber. So they are truly "dead man walking", and if someone "attempts" to force then to make the necessary investments to bring their "plant" up to date, without a significant increase in rates (or government subsidies), they will just go bankrupt.
"I transferred the fee using my Frontier Internet connection.
What? You didn't get it?
Maybe you should look into that; your service seems pretty unreliable."
It must have been something you assimilated. . . .
Except there was no monopoly as she switched providers before canceling. And I addressed the inherited piece later in my post with parentheses and everything.
Summary says,
Note the words "newly available"
https://en.wikipedia.org/wiki/Inverted_totalitarianism
the fee is still so large that it could "put her out of business," the news report said
Since Candace Lestina essentially "inherited" the business, and the crappy service, that sounds like the service is actually in the business's name, not an individuals. So -- fold.
The Pardeeville Area Shopper declares bankruptcy from early termination fee -- but first it sells all its assets off to a new company. Company B licences/rents those same assets back to the original company to use. The bankruptcy of course means that arrangement ends. Assets are now the property of Company B. Employees (being one person) get laid off. Frontier is left holding the empty shell of the previous company, Ms Lestina moves on to the new company and starts up again under the new name.
If they failed to reasonably provide their provision of the contract, notify them as per the contract (or in any reasonable manner) and say so. Say that you don't consider the contract fulfilled, and will be terminating based on their failure to fulfil it.
Give them a reasonable time, etc. Keep telling them. Keep telling them it's not adequate.
Then... cancel the contract. If the contract was never fulfilled, then it's as if it never existed, thus any "agreed" cancellation fee never was agreed at all. They didn't hold up their side, so you don't need to hold up yours at that point.
However, you have to have notified them (just because the contract says a certain way doesn't mean it *has* to be that way, but it's best to play their game... imagine if you went to court and had to explain how you did things... "Not only did I go through their cancellation forms online, your honour, but I also wrote them a registered-delivery letter which I have proof they received, got no reply, joined into a web-chat which I have provided a transcript of, telephoned them for 45 minutes which I have the phone bill here to prove, and still I was unable to cancel the contract".
You don't *need* to go to court... it's far too petty for that. But you act as if you were gathering evidence for a court. Any court will take steps to side with the party that was being reasonable, expressing their concerns, trying to do things properly, trying to make sure they didn't get into trouble, trying to give the other side a decent chance to rectify.
And because you operate like that, the right people at the company - when it gets escalated to the very-real threat of a court case (i.e. a summons to court) - they will look at how you have been doing things, realise that they stand no chance, and likely settle.
Even before that, though, most senior people in a complaints department have an ear for things like that... they can tell the ones who *are* prepared and are keeping every correspondence and will more likely pay to keep those people away while batting away all the "I'LL SUE YOU! GIVE ME MY PRODUCT FOR FREE AND A YEAR'S CREDIT OR I'LL SUE YOU!" idiots.
If they haven't provided a reasonable interpretation of the product/service they said they would, and haven't rectified that despite being given more than enough chance, then you notify and cancel. They'll say you can't, and all kinds of things. But, fact is, if they haven't reasonably complied with their end of the contract, the contract is null and void. Not only that, if it's *never* been fulfilled, you can most likely get all the money back that you've ever paid them. Even "non-returnable deposits" and things like that.
No delivery, no contract. No contract, no cancellation charge. No cancellation charge, no debt to them.
Seek advice if you're not good at these things.
[[I've never needed to and though I don't do stuff 100% official, I'm sure, I research and I always get a decent outcome and have variously been threatened with court (dozens of times), bailiffs, and all kinds - and yet never once had any of those things even started, and in fact had people pay me "not to take it to court, right?" because they were so far in the wrong they didn't even realise until I presented the evidence to them. Insurance companies, telecommunications providers, landlords, letting agents, banks, ... all kinds of companies have come unstuck when they just go through the "standard procedure" and I actually have a genuine grievance that they don't handle.
I've had money for an entire contract term forcibly ripped back out of their accounts going back months (have to love UK Direct Debit law... I got a very polite phone call literally two minutes later...), I've had insurance companies mess up so bad they begged for me to not take them to court, I've turned "We're going to take you to court" into "Oh.... sorry... no, that's absolutely our mistake, here's a cheque" (often a few days after I say "No problem, I have copies of
The AT&T breakup dealt with the long distance phone monopoly (MCI was using microwave transmitters to send voice over the long distance leg, turning a long distance call into two local calls plus their microwave hop; hence their name - Microwave Communications Inc). It didn't touch the government-granted local phone monopolies. Each region still had just one phone company which owned the lines and provided service. The AT&T breakup just made it so most long-distance calls went between two different phone companies, instead of within a single company.
Yeah they allowed local phone competition, but all the competitors had to use the monopoly phone company's phone lines. The monopoly company exploited this to drag service and repair requests for competing companies out for days, even weeks. And the customer would get mad at the competitor they were using, instead of at the monopoly phone company who owned the lines. I had to deal with this BS when setting up T1 service at a business. The service was with Speakeasy, but they leased the line from Verizon since Verizon was the monopoly phone provider in the area. The line had problems every time it rained. Speakeasy would take my service request immediately and submit a repair ticket with Verizon. Verizon would drag it out for a week, and when they tested the line a week later (when it was no longer raining), miracle of miracles! The line would test just fine and they would close the ticket. This went on for years until while upgrading service I just happened to get a call from Speakeasy and the Verizon service rep wiring the new line while it was raining. I immediately asked him to test it, and sure enough it was drowning in static. That got them to finally admit the line was faulty and send someone out to find the problem and fix it.
That's what's going on here. Frontier is the government-anointed monopoly service provider for the area. Because they own the lines, when their service quality sucks because of poor line quality, every DSL provider's service sucks equally because they're all using Frontier's lines. So Frontier has no incentive to repair or upgrade their lines. It doesn't impact the competitiveness of their business, and fixing things would just cost them more money The government agency regulating their monopoly (your state's public utilities commission) is supposed to make them behave, but they're largely ineffectual.
The way the local phone service should be done is like gas or electric service. You don't want a rat's nest of lines like India, so you do want only one company installing lines. That monopoly company installs and maintains the gas and power lines, but they're prohibited from selling gas or electricity. Instead, you can buy your gas and electricity from dozens/hundreds of companies selling those products. They all pay a transmission fee to the monopoly company, all of them paying the same fee. The fee is regulated by the PUC who looks into the monopoly company's financials each year to guarantee they're making only a certain percentage profit.
The failure of government regulators to set up phone service this way makes this squarely a failure of government regulation. If you were willing to have the rat's nest of lines and followed the Libertarian model allowing competing phone services, any company not maintaining and upgrading their lines would be committing economic suicide, and would die off. Only the companies which maintained their lines would survive.
Her business should sue in Small Claims. First try the ISPs arbitration process. Judges don't like parties not trying anything and just going to court. If the limit isn't small like in some states ($2500!?!); add in the travel and court and lost business expenses. Also have all the times the service was out and you called in about it. If you haven't kept that, start collecting for a month and then sue.
Before the court date, the company lawyers will try to settle. And if it goes to court, she will probably get pushed to the court's arbitration where her company will get a fare shake. If that doesn't work out, considering she is a one man shop, the judge will treat her business almost like an individual. It really comes down to how well she presents her story.
She probably will still have to pay $1-2k thou. Unless the ISP shows that they invested $1k+ putting down a line just for her on the idea that it's a 3+ year contract; they won't get the full amount just because of the contract. There is no harm to the ISP to justify the fee so the judge will cut it down. But expect that the judge won't give you anything for the travel, time lost, and business damage from poor service.
Instead she chose to call customer service and then whine to the news.
There are certain companies, and certain entire lines of business where calling customer service just doesn't work. Airlines are notorious for this, and so are cable companies. So in such cases you can only get justice by shaming them on social media.
Often not possible with doupolies, you want internet you choose between two evil options.
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We have two choices for internet access (like most Americans). They both suck. Over the years, one will get bad, and the other will improve, so we generally switch ISP's every 3-5 years. Sometimes quicker. We often have a leftover contract. We just let the shitty ISP dangle. The ship it off to collections and ding our credit. I don't really give a shit and just ignore them.
We need internet access regulated by the Feds asap. The current situation sucks.
I don't respond to AC's.
Clearly the take-away is that 'Frontier Communications' are incapable of providing a service worth paying for yet still want to be paid.
One would consider that any enforceable contract would stipulate that both parties receive satisfactory outcomes from their collaboration.
Requiem for the American Dream