Verizon Wireless Lawsuit

Verizon Wireless has filed a complaint in U.S. District Court in Phoenix, detailing an ongoing scheme in which it engaged in fraudulent conduct, namely, utilizing bulk SMS campaigns to fraudulently charge its customers and the carrier for services it never received. The complaint further details Verizon’s efforts to thwart attempts by the FTC to investigate the charges. Verizon Wireless is one of the largest wireless phone service providers in the United States. The company recently acquired Yahoo! Answers, a Web-based service designed to give people help with technical questions.

Verizon Wireless Complaint

The case was brought to the attention of the attorney general by Verizon Wireless’ consumer protection division. According to the complaint, Verizon Wireless engages in “systemic mispricing” in violation of the Federal Trade Commission Act. “Systemic mispricing,” according to the attorney general, is “the manner in which a company satisfies its consumers by charging them for services it did not provide.” Such behavior, according to Verizon Wireless, is deceptive advertising, known as “caveat emptor.” The attorney general further notes that the actions of Verizon Wireless “pose a substantial and potential threat to consumers who receive or may receive text messages from their cellular phone.”

According to Verizon Wireless, it is not able to determine how many accounts Verizon Wireless has under billing at this time nor is it able to determine how those accounts will be calculated.

Verizon Wireless also requests that the Court limit the Complaint to one pending litigation against only one carrier. The Parties submit case schedules to the Court indicating how many Verizon Wireless accounts are being blocked, how they were blocked, the dates of when the account was blocked and if any damages have been assessed. Also attached to the schedule is the fax number used to contact the subscriber to notify them that the account is being blocked. The Parties submit additional information to support their positions.

The Parties will also be required to submit discovery templates to assist in the determination of whether legal action should be pursued.

Discovery is a process where a party requests information from another party. Discovery is usually the initial step in a lawsuit. The Federal Rules of Civil Procedure allows a party to discovery all matters which are relevant to the subject matter of the action. This includes all statements made by the opposing parties, all documents, correspondence and any other items which contain statements or information pertinent to the subject matter of the Action. In the case of a Verizon Wireless lawsuit, Verizon Wireless has been unable to receive testimony from an expert witness whose opinion would have significantly changed the outcome of the lawsuit.

The complaint states that Verizon Wireless’ anti-spam efforts were inadequate; however Verizon Wireless failed to conduct meaningful internal controls that would prevent the incidence of overcharging or abusive blocking of consumers’ accounts.

Furthermore, Verizon Wireless failed to obtain an acceptable waiver from its customers prior to blocking their accounts. Finally, Verizon Wireless did not instruct its personnel to block accounts when they were not enrolled in the program. The complaint further states that Verizon Wireless failed to follow the proper procedures required when pursuing a valid consumer arbitration claim, such as a written notice of complaint and an opportunity for the customer to be heard.

As per the complaint, Verizon Wireless was not a party to the complaint when it was filed in the federal district court. Accordingly, the complaint was not a party-lawsuit within the meaning of Fed.R.P.A. Fed.E.D.C.

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