SAN FRANCISCO-T-Mobile USA Inc. paid a $135,000 fine to settle a deceptive-advertising claim brought by New York’s Department of Consumer Affairs.
This summer, the department took action against T-Mobile USA, as well as Sprint Corp. and Nextel Communications Inc. charging that while newspaper ads promised cell phone deals, the fine print contradicted the terms of the deal. Sprint has since acquired Nextel, and the case against them is still pending.
“We’re pleased that T-Mobile has committed to full compliance and done right by consumers. New York City law prohibits companies from running advertisements that promise great deals in the headlines only to take them away in the fine print,” said Jonathan Mintz, acting commissioner.
The city’s Consumer Protection Law calls for a maximum fine of as much as $500 per count, with each count based on the newspaper’s circulation, the number of times an ad ran, or other parameters dependent on the court’s rulings. The ads involved in the case appeared in The New York Post, Newsday, Daily News and The New York Times.
The telecom sector is one of the nation’s top advertising sectors, with the seven top cell-phone providers spending $4.7 billion in 2004. In a statement, T-Mobile USA said it “is committed to truthful and accurate advertising, and we believe our advertising fully complies with all laws and regulations. Although T-Mobile strongly disagrees with the New York City Department of Consumer Affairs’ claims, we were pleased to resolve the case and put this matter behind us.”
Alice Z. Cuneo is a reporter with AdAge.com, a sister publication of RCR Wireless News.
