Californians may get a break from their cell phone companies – a big one. Late last month Judge Bonnie Sabraw, a Superior Court Judge in Alameda County, ruled that cell phone carriers that charged customers early termination fees for canceling their contracts did so in violation of state law.
In a class action lawsuit against Sprint Nextel that challenged the charging of early termination fees on contracts, the judge rules that the practice was against the law and ordered the company to pay over $18 million to Sprint customers in California.
Of course, Sprint plans to appeal the ruling but if it stands, it could be the beginning of a nationwide consumer revolt. There are other such lawsuits across the country that challenge the fees and this ruling, while only a preliminary one, invites more of the same.
Cell companies do not like this at all. In fact, they are heavily lobbying the Federal Communications Commission to regulate the fee and protect cell phone carriers from future lawsuits. FCC Chairman Kevin Martin has already publicly proposed an initiative to prorate the fees during the period of the service contract.
Sprint Nextel claims the charges are reasonable and necessary to offset the cost of the cell phones offered in contract, which they maintain are sold to users below cost. However, the popular opinion among cell phone users and apparently, that of the judge herself, is that the fees are in place to discourage users from dropping the service and switching to another carrier.
I despise cell phone service contracts and I think they are very bad for consumers. If you are stuck with a carrier that doesn’t deliver services to your satisfaction, you are stuck. I wouldn’t mind paying more for a cell phone if it would mean I am a free agent and can fire the company and hire another one to serve me anytime I want without penalty.
This is also why I don’t own an iPhone. When I purchase a cell phone – or any tangible product – I want the freedom to choose when and how it will used. I don’t like to be told to pay a premium for a mobile device and told who my carrier will be. I don’t appreciate being locked into a contract at overpriced rates just to have a pretty phone. If I like the phone but I don’t like the service, I want to be able to switch to a service that I feel serves my needs. If I can’t, the phone isn’t worth the money that created it.
If the sole reason for early cancellation fees is to offset the cost of the phone, there’s a simple solution: sell the phone for what it’s worth and ditch the fees. So, what If you BYOP (Bring Your Own Phone) and order service? Are you offered open monthly service or a contract without cancellation fees? Apparently not, or at least not that I could locate when I searched the Sprint Nextel web site.
I did find one thing. Included in their Terms and Conditions, which is located behind links buried within the individual service plans listed on their site, is a clause stating that by signing the agreement, Sprint Nextel customers waive the right to pursue or join a class action lawsuit.