A settlement has been reached in a class action that alleged that T-Mobile engaged in the unfair, deceptive and misleading business practice of overcharging its cellular telephone customers for calls dialed to/from their cellular telephones while their customers (and their cellular telephones) were outside the United States. The settlement, which was approved by both the San Diego Superior Court in December 2006, requires the Defendant to pay benefits to the class members valued at approximately $4,448,000 as set forth in more detail below.
CASE NAME: Behar International Counsel v. T-Mobile USA
TYPE OF CASE: Class Action
JUDGE: The Honorable Jay Bloom – San Diego Superior Court
PLAINTIFFS REPRESENTED BY: Robert A. Curtis of FOLEY BEZEK BEHLE & CURTIS, LLP; J. Paul Gignac of ARIAS OZZELLO & GIGNAC, LLP; R. Craig Clark of CLARK & ASSOCIATES
DEFENDANTS REPRESENTED BY: Christopher Hockett and Thomas Hixson of BINGHAM McCUTCHEN
FACTS: Before March 2003, Plaintiff entered into a standard Service Agreement for cellular telephone service from defendant T-Mobile USA, Inc. (“T-Mobile”). In or around March 2003, Plaintiff noticed that its T-Mobile telephone bill contained two roaming charges of $4.99 each for numerous one minute telephone calls allegedly placed to Plaintiff’s cellular telephone while Plaintiff and Plaintiff’s cellular telephone were outside of the United States – calls which Plaintiff never made or received. As alleged in the complaint in this action, Plaintiff contacted T-Mobile several times regarding this matter but never received any explanation or a cash refund for the $4.99 charges.
As a result, Plaintiff sought the help of Foley Bezek Behle & Curtis, LLP and Arias Ozzello & Gignac, LLP, who together with the help of San Diego counsel R. Craig Clark, filed a class action lawsuit against T-Mobile in the San Diego Superior Court alleging, inter alia, that T-Mobile engaged in the unfair, deceptive and misleading business practice of billing its cellular telephone customers for calls dialed to/from their cellular telephones while their customers (and their cellular telephones) were outside the United States, even though their customers never received/made the calls for which they were billed. The class action complaint sought damages for Violation of California’s Unfair Competition Law, Breach of Contract, Unjust Enrichment and Declaratory Relief.
T-Mobile immediately moved to strike Plaintiff’s class action on the grounds that the contract that Plaintiff had entered into contained a clause that prohibited class actions and also sought to move the case to arbitration based on an arbitration clause in the contract. Judge Bloom of the San Diego Superior Court denied T-Mobile’s motion to strike the class action allegations on the grounds that such waivers are unconscionable under California Law but ordered the matter to class arbitration in front of the American Arbitration Association. Robert Brent of the American Arbitration Association was appointed the arbitrator.
After completing discovery and surviving a motion to dismiss in the class arbitration, T-Mobile approached Plaintiff with the possibility of mediation. After several exchanges of data and meetings of experts to assist in determining the class size and potential damages, the parties mediated their dispute before the Honorable Robert Altman (Ret.) of ADR Services, Los Angeles.
RESULT: The settlement reached on behalf of the entire class, which was approved by both the San Diego Superior Court and the Arbitrator pursuant to the AAA’s class action rules in December 2006, required the Defendant to pay benefits to the class members valued at approximately $4,448,000. The reaction of the members of this class to this settlement was extremely positive as only 57 of the more than 248,000 class members opted-out of the settlement and not a single class member objected to the settlement at the final approval hearing.