How many of us have felt like we were in a bad, inescapable relationship with our cell phone company? So many times, I’ve sat on hold fuming, then labored to speak calmly and politely to the customer service representative who is just as blameless as the next guy for my whack, bootleg phone and its no-reception having, call-dropping, sorry-excuse-for-a-piece-of-technology self. How many of us have gotten our phone bill at the end of the month and thought, “But I work all day, how could this be correct?” And just when you think you’ve hit that boiling point and are ready to call it quits, it’s-not-you-it’s-me-style, the voice of wisdom tauntingly reminds you: “It’s cheaper to keep’er.”
There’s the early termination fees (ETFs); then there’s the fact that you might have to purchase a new phone to get new service; and then there’s the fact that switching to a new carrier is essentially a stab in the dark anyway. Who knows if the new company will provide better, worse, or equally bad service as who you’re with now? One thing that the whole industry has in common is the practice of imposing mandatory arbitration agreements (yes those lovely MBAs are back again). So, what’s the point of shopping around if there’s nothing to shop for, i.e., the right to be legally protected against a bad product?
Well, a California court made a good call for disgruntled customers, finding the arbitration agreement they had with T-Mobile to be unconscionable and unenforceable, and thus giving them the go-ahead for a class action lawsuit against the phone company.
Customers say that the company used unfair business practices in its rules surrounding early termination fees and its practice of cell phone locking. The early termination fees (ETFs) of up to $200 are applied at a flat rate (no pro-rating) and apply even to customers who have made numerous unsuccessful requests to correct problems with their service. The cell phone locking is a program in the hand set that prevents it from recognizing anything but T-Mobile Network SIM-cards, thus preventing the use of the phone with other service providers.
T-Mobile requested that the plaintiffs be forced to go to arbitration, in a motion to compel arbitration, but the trial court denied this request. The appeals court’s agreement with the lower court means that customers will now be able to take this case to a court of law as a group. The difference between the two options is often crucial, as we have seen that arbitration companies often strive to be “repeat-players” with the corporations who hire them, and so face lucrative incentives to find in favor of the company.
Things certainly could be better in the judiciary (did someone say Louisville/Seattle?) but at least some folks over in California will get to have their day in court.