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Judge Cancels Telecom Fee Award

Publication Date: 
December 08, 2008
Los Angeles Daily Journal
Noah Barron

Lecturer in Law Ryan Calo is quoted in an article in the Los Angeles Daily Journal regarding the revision of an award in a telecom early-termination fee case:

A judge in Alameda has revised an earlier award in the closely watched Sprint early-termination fee telecom case and ruled that the company and the phone customers owe each other the same amount of money, $73 million, canceling out both sides' claims.

It's a step forward and a step backward for consumers hoping to collect money Sprint charged them for canceling their cell plans early. For consumers who already paid the fee, as much as $200 to break cell contracts before the set date, they're out of luck. But for customers who were charged and never paid, Sprint is barred from trying to collect.


Lawyers say the ruling makes suits of the kind less appealing because losing potentially means owing your cell carrier money."It does signal that these class actions don't have the same traction. There's the risk that a counterclaim of breach of contract will win out," said telecommunications law expert Ryan Calo at the Center for the Internet and Society at Stanford Law School.

He said that with the big four telecom companies all self-regulating by switching to pro-rated fees, the likelihood of the FCC stepping in to unify state regulations is less than it was earlier this year.

Calo pointed to statements made by FCC chairman Kevin J. Martin at a hearing in Washington, D.C., concerning early termination fees, in which Martin spoke of using federal preemption rather than "a patchwork" of class actions across 50 states.

Calo said that Sabraw, in ruling that the consumers owed Sprint money but couldn't collect, handed down, "in effect, a plaintiff's loss."