Alltel joins rivals under cloud of ETF class actions

Alltel Communications L.L.C. has been slapped with a class-action lawsuit over levying early termination fees on consumers that left the wireless carrier before the end of their service contracts.
“Through a uniform scheme and common course of conduct, defendant charged plaintiff and other customers ETFs of $200 per handset if they cancelled their wireless service at any time after a trial period but before the end of the ‘service plan,’ regardless of the reason(s) for cancellation, which could include poor or nonexistent service (including, for example, because a consumer is unable to obtain wireless service in certain locations as needed),” stated the 25-page lawsuit filed in U.S. District Court in Atlanta.
The lawsuit is similar to one filed againstT-Mobile USA Inc. in New Jersey federal court last month.
National cellular operators have been ensnarled in massive ETF litigation in California state court, with Alameda County Superior Court Judge Bonnie Sabraw last month ordering Sprint Nextel Corp. to pay $18.25 million to users who paid ETFs and provide a credit of $54.75 million to those who were charged but didn’t pay the fees.
Verizon Wireless settled a class action ETF suit in California Superior Court for $21 million earlier this year. Any objections to that settlement must be submitted to the court by Oct. 7.
Further, the nation’s top cellular carrier, AT&T Mobility, remains under the cloud of a class-action ETF lawsuit in the same court.
Meantime, Federal Communications Commission Chairman Kevin Martin is trying to round up other commissioners’ support for a national framework for ETFs. Such a plan, which the wireless industry strongly endorses, could remove remaining state jurisdiction over a fundamental business practice designed to recover operators’ costs – particularly those associated with subsidization of handsets.
Consumer advocates, state regulators and some lawmakers appear to share Martin’s desire to bring clarity, fairness and consistency to ETFs for many of the 265 million wireless subscribers, but they do not want state powers eviscerated in the process. It is unclear whether the FCC will be able to adopt national ETF guidelines before year’s end without backing from leading consumer groups.
House and Senate lawmakers are working on wireless consumer protection legislation, but bills and draft legislation differs on – among other things – the role of states.
The mobile-phone industry could face greater federal regulation – with limited state oversight kept intact – if Democrats win the White House and pad their majorities in Congress in the fall elections.