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T-Mobile Pays $135,000 Fine to NYC

December 15, 2005

T-Mobile • Billing disputes • Defective phones • Network problems • Rate disparities --- News • Court Throws Out T-Mobile's Forced Arbitration Clause • California Supreme Court OKs T-Mobile Class Action • T-Mobile Pays $135,000 Fine to NYC • NYC Sues Wireless Phone Companies for Deceptive Advertising • German Parent May Sell T-Mobile • T-Mobile Ranks Highest in Wireless Customer Care Performance

T-Mobile USA, Inc. has paid New York City $135,000 and agreed to fully comply with the city's Consumer Protection Law. The settlement follows the agency's lawsuit charging consumers were misled through deceptive cell phone advertisements.

"We're pleased that T-Mobile has committed to full compliance and done right by consumers," Jonathan Mintz, DCA Acting Commissioner, said. "New York City law prohibits companies from running advertisements that promise great deals in the headlines only to take them away in the fine print. We're another step closer to ensuring consumers purchasing wireless products from all companies will be protected."

The DCA filed suit in July 2005 against three major wireless companies -- T-Mobile U.S.A., Nextel Communications Inc., and Sprint Spectrum L.P. -- in New York Supreme Court for pitching cell phone products and services in deceptive advertisements that misled consumers. Nextel and Sprint have since merged and continue in litigation.

In its lawsuit, the DCA charged that T-Mobile's advertisements were both confusing and misleading. The agency believed the disclosures made in the advertisements contradicted the company's principal offer.

The New York City Consumer Protection Law requires the type size used in print ads to be clear and conspicuous to the reader in order to avoid deceptive and unfair trade practices. It prohibits practices that have the capacity, tendency, or effect of deceiving or misleading consumers.

In 2004, the DCA also pursued claims against AT&T Wireless (since acquired by Cingular Wireless LLC), Cingular Wireless, and Verizon Wireless for deceptive advertising, but those companies settled without litigation and agreed to fully comply with the New York City Consumer Protection Law in their marketing.

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