Sprint To Pay $17.5 Million For Early Termination Fees - InformationWeek
Government // Mobile & Wireless
07:49 PM
Building Security for the IoT
Nov 09, 2017
In this webcast, experts discuss the most effective approaches to securing Internet-enabled system ...Read More>>

Sprint To Pay $17.5 Million For Early Termination Fees

The company has secured preliminary court approval for a settlement regarding early termination fees, and it may help the carrier dodge larger class-action suits.

In a move that may help it move beyond consumer litigation, Sprint Nextel this week said it secured preliminary court approval for a $17.5 million nationwide settlement over the carrier's early termination fees.

U.S. District Judge Jose Linares in New Jersey federal court said the settlement doesn't include the California case where a judge ruled the carrier had to pay $73 million over its cancellation fees. A settlement would potentially derail a nationwide $1.2 billion class-action lawsuit that charges Sprint's early termination fees -- or ETFs -- violate several state laws.

Scott Bursor, the lead attorney in the class-action suit, said he isn't happy with the potential settlement, which would be doled out in cash, credits, and vouchers. He said he may submit a filing with the New Jersey federal court to block the settlement, which would receive final approval in March 2009.

Sprint has recently changed its policy for canceling service before a contract is finished, and the $200 fee now decreases by $10 per month beginning in month six of the contract. The adjusted cancellation fee only applies to new contracts, but existing subscribers can get it by renewing their service agreement.

All of the major U.S. wireless carriers have ETFs, and many of them have faced multimillion-dollar lawsuits over them. These fees remain a contentious issue in the industry, and many consumer advocates say they are overly punitive and limit choice. The majority of U.S. subscribers get their handsets subsidized, and mobile operators argue the cancellation fees are necessary to recoup those costs.

The issue has even caught the eye of the Federal Communications Commission, and outgoing chairman Kevin Martin said he favors a nationwide policy for cell phone cancellation fees.

Comment  | 
Print  | 
More Insights
Newest First  |  Oldest First  |  Threaded View
How Enterprises Are Attacking the IT Security Enterprise
How Enterprises Are Attacking the IT Security Enterprise
To learn more about what organizations are doing to tackle attacks and threats we surveyed a group of 300 IT and infosec professionals to find out what their biggest IT security challenges are and what they're doing to defend against today's threats. Download the report to see what they're saying.
Register for InformationWeek Newsletters
White Papers
Current Issue
2017 State of IT Report
In today's technology-driven world, "innovation" has become a basic expectation. IT leaders are tasked with making technical magic, improving customer experience, and boosting the bottom line -- yet often without any increase to the IT budget. How are organizations striking the balance between new initiatives and cost control? Download our report to learn about the biggest challenges and how savvy IT executives are overcoming them.
Twitter Feed
Sponsored Live Streaming Video
Everything You've Been Told About Mobility Is Wrong
Attend this video symposium with Sean Wisdom, Global Director of Mobility Solutions, and learn about how you can harness powerful new products to mobilize your business potential.
Flash Poll