California Deals Another Blow to Property Rights

[Fox McCloud]

Judge orders Sprint Nextel to pay $73M for contract-termination fees

A Superior Court judge in California on Monday ordered Sprint Nextel Corp. to pay $18.25 million to customers who sued the company for charging them to get out of their contracts early, as well as an additional $54.75 million in credits to those who were charged but never paid the early-termination fees.

The order from Alameda County Superior Court Judge Bonnie Sabraw resolves a 2003 case in which nearly 2 million class-action customers sought to get out of paying the early-termination fees, which Overland Park-based Sprint (NYSE: S) and other telecommunications providers typically charge to customers who interrupt their commitment to the company’s services before their contract expires.

Sprint had argued that state law in California preempted federal laws governing telecommunications rates and further suggested that the early-termination fees counted as rates in state law.

Sabraw’s ruling stated that state law didn’t trump federal law in this case and that Sprint didn’t prove that the early-termination fees count as rates.

According to the judge’s ruling, Sprint charged nearly $300 million in early-termination fees to class members, almost $73.78 million of which it collected.

“We’re disappointed, but this is a tentative decision, and we are focusing now on our response to the court,” Sprint spokesman Matt Sullivan said in an e-mail.

Sprint ranks No. 1 on the Kansas City Business Journal’s list of area public companies.

This is ridiculous--it's Sprint's service and when you use their network you have to agree to their TOS in the contract; if you break the TOS in any way, then you have to abide by the penalties of voiding the contract-in Sprint's (and other telecom's) case it's an early termination fee.

This is a bad precedent set in California (especially if other States do this, or the Federal government does it), as it puts forth the idea that you can't be charged for voiding a contract (which, you know, kinda voids the whole point of a contract).

As long as Sprint isn't fraudulently terminating people to collect money from the ETF, then there shouldn't be any problem--it's Sprint's property, and therefore they make the rules.

*sigh* sometimes I hate this government.

[Kalifornia]

This is ridiculous--it's Sprint's service and when you use their network you have to agree to their TOS in the contract; if you break the TOS in any way, then you have to abide by the penalties of voiding the contract-in Sprint's (and other telecom's) case it's an early termination fee.

This is a bad precedent set in California (especially if other States do this, or the Federal government does it), as it puts forth the idea that you can't be charged for voiding a contract (which, you know, kinda voids the whole point of a contract).

As long as Sprint isn't fraudulently terminating people to collect money from the ETF, then there shouldn't be any problem--it's Sprint's property, and therefore they make the rules.

*sigh* sometimes I hate this government.

Then perhaps you should hate the government for granting an oligopoly of the public airwaves. The telcos are not in a private market, they knew that going into it, so I have no problem with them getting their asses handed to them on a regular basis.

[Fox McCloud]

I'm no fan of the Telco's and cable-co's either, primarily due to the FCC helping them become what they are (plus local and State governments do not help).

That said, why wouldn't air-waves be private property as well?

Just because a company breaks the laws of liberty doesn't mean that we should break the laws of liberty against them--if you use that logic then we should be able to do any number of immoral and illegal activities without punishment.

[Nanerbeet]

Agreed



What if I had been planning to start a new phone company that didn't charge early termination fees? There goes my competetive edge.


This is also why I argument against net neutrality; if the major providers really start blocking traffic to web-sites, wouldn't that create a need for a new startup to fill that need? Whats the point of having a competetive free market if the government just forces the corporation to give the customer what he demands???

People are going to fall for net neutrality and they're going to fall for fair tax. Fair tax is scary because there aren't any statutes on the books for income tax; its all "voluntary compliance." Well... the fair tax movement is a clever delivery mechanism to get taxation on the books and make it legal. I fucking fear it.



Its getting pretty fucked up out there and Commufornia is leading the charge.

[sratiug]

That said, why wouldn't air-waves be private property as well?



Because air waves are not private property.

[H Roark]

As a former Sprint customer, who waited for my contract to terminate I am happy that they suffered a loss. I'm surprised that the class-action lawsuit wasn't based on falsely added charges, which I had to wrangle with them to get them taken off my bill.

I don't think its as clear cut as you may think, there is no doubt that Sprint has not lived up to its own end of the contract with some customers.

[Fox McCloud]

As a former Sprint customer, who waited for my contract to terminate I am happy that they suffered a loss. I'm surprised that the class-action lawsuit wasn't based on falsely added charges, which I had to wrangle with them to get them taken off my bill.

I don't think its as clear cut as you may think, there is no doubt that Sprint has not lived up to its own end of the contract with some customers.

as a current Sprint customer, I share your pain of what Sprint has done...that said, the only reason this judge is doing this is because, according to her, the ETF is "illegal"--it has nothing to do with the reason or Sprint's actions, it's merely an attack on the ETF.

[JosephTheLibertarian]

This is ridiculous--it's Sprint's service and when you use their network you have to agree to their TOS in the contract; if you break the TOS in any way, then you have to abide by the penalties of voiding the contract-in Sprint's (and other telecom's) case it's an early termination fee.

This is a bad precedent set in California (especially if other States do this, or the Federal government does it), as it puts forth the idea that you can't be charged for voiding a contract (which, you know, kinda voids the whole point of a contract).

As long as Sprint isn't fraudulently terminating people to collect money from the ETF, then there shouldn't be any problem--it's Sprint's property, and therefore they make the rules.

*sigh* sometimes I hate this government.

I thought you supported state's rights, sir :) Oh, only when it goes your way? ok. The contract is another matter. They signed a contact with a termination fee attached? That's their problem.

[ewizacft]

This sounds like something that happened to my friend. He had at&t(I think) and sprint bought at&t or someone bought someone. So the carrier that was bought out was the one he had. He was charged for termination of the contract and an activation fee for the new company. He told me he had to activate with the new company because of his contract with the old company. I don't remember all the details, but it seemed unfair at the time. I wonder if this is what the lawsuit was about because they were charged to get out of a contract when they were forced out. Not just canceling and then complaining about the fees.

[JosephTheLibertarian]

This sounds like something that happened to my friend. He had at&t(I think) and sprint bought at&t or someone bought someone. So the carrier that was bought out was the one he had. He was charged for termination of the contract and an activation fee for the new company. He told me he had to activate with the new company because of his contract with the old company. I don't remember all the details, but it seemed unfair at the time. I wonder if this is what the lawsuit was about because they were charged to get out of a contract when they were forced out. Not just canceling and then complaining about the fees.

Yeah. I'm not sure if they can morally transfer an obligation from and to different companies. That's iffy imo. But I tend to lean with the consumer as much as possible. We should always take up on opportunities to side with the "little guy."

[noxagol]

Because air waves are not private property.

only because the government controls it. Take the government out of it and amazingly they really are private property eminnating from the radio tower.

[Cinderella]

i have sprint and they SUCK!!!!! their customer service sucks as well.....they like to add years onto people contracts and when u think ur contract is up they tell u u still have another year...im going thru it now...my contract was supposed to be up with them aug of 2008....when i called them to make sure everything is all set bcuz i want to move to verizon they tell me i have another year!!!!!! ive been their customer for 7 years and im sick of the abuse and their lies....if they expect me to pay some ealry termination fee there in for a surprise!!!

[JosephTheLibertarian]

i have sprint and they SUCK!!!!! their customer service sucks as well.....they like to add years onto people contracts and when u think ur contract is up they tell u u still have another year...im going thru it now...my contract was supposed to be up with them aug of 2008....when i called them to make sure everything is all set bcuz i want to move to verizon they tell me i have another year!!!!!! ive been their customer for 7 years and im sick of the abuse and their lies....if they expect me to pay some ealry termination fee there in for a surprise!!!

Sorrry to hear that, darling. Get a pre paid

[acptulsa]

only because the government controls it. Take the government out of it and amazingly they really are private property eminnating from the radio tower.

Should mineral rights go with property rights? They were divorced because back when coal and minerals were about all that we cared about below the ground, mines could tunnel under land and extract minerals from it without affecting activities on the surface. As soon as we got infatuated with oil, which at least was only accessible with vertical drilling, it became "you're destroying my farm" vs. "you're trying to keep me from my minerals".

The signals are private property, but the electromagnetic spectrum is only so big and, as with air traffic, overcrowding and a lack of assignments and cooperation produces no communication, only static. Not as bad as mid-air collisions between airplanes full of people, but completely counterproductive nonetheless.

That said, why would early termination clauses be illegal? So they can't afford to give phones away with the contract any more? This is an advantage to someone?

[JosephTheLibertarian]

Should mineral rights go with property rights? They were divorced because back when coal and minerals were about all that we cared about below the ground, mines could tunnel under land and extract minerals from it without affecting activities on the surface. As soon as we got infatuated with oil, which at least was only accessible with vertical drilling, it became "you're destroying my farm" vs. "you're trying to keep me from my minerals".

The signals are private property, but the electromagnetic spectrum is only so big and, as with air traffic, overcrowding and a lack of assignments and cooperation produces no communication, only static. Not as bad as mid-air collisions between airplanes full of people, but completely counterproductive nonetheless.

That said, why would early termination clauses be illegal? So they can't afford to give phones away with the contract any more? This is an advantage to someone?

Mineral rights believer, eh? Mineral rights is just a weasel move by greedy people to screw the "little guy" time after time. No one has an inherent right right any underground mineral.

[acptulsa]

Mineral rights believer, eh? Mineral rights is just a weasel move by greedy people to screw the "little guy" time after time. No one has an inherent right right any underground mineral.

According to Native Americans no one has a right to claim ownership of any part of Mother Earth. Refreshingly simple, but will it still work?

[sratiug]

only because the government controls it. Take the government out of it and amazingly they really are private property eminnating from the radio tower.

You are talking about electromagnetic waves. They may be private property, and sound waves may be private property, but that doesn't mean I'm paying anybody to listen to their bullshit. The airwaves are all the frequencies that electromagnetic waves may use, they are no more private property than the air itself.

[JosephTheLibertarian]

According to Native Americans no one has a right to claim ownership of any part of Mother Earth. Refreshingly simple, but will it still work?

Solution is that gov does not enforce property ownership rights, unless the land is being used. Only personal property is fair game imo.