Alltel Sued Over Content Billing
Thursday, April 17, 2008; 7:00 PM
A class-action lawsuit has been filed against Alltel (NYSE: AT) accusing the carrier of "systematically, repeatedly and without authorization, billing its customers for purchases and services not agreed to by those customers" reports RCR News. "Alltel's decision to continue to charge its customers for mobile content without taking steps to authenticate the representations of the mobile content providers that the customer's authority to be charged was obtained constitutes a deliberate and willful scheme to cheat large numbers of people out of small amounts of money," the plaintiff stated. Alltel has declined to comment on the specific charges.
There are no details given on the particular billing situation being sued about, but the general issue of third party billing has been around for a while, particularly tricking people into signing up for expensive content subscriptions by offering "free" content. AT&T was fined by the Florida AG last month over the issue. Nevertheless, if telcos are held responsible for the actions of third party vendors and the failure of people to read the fine print a fine line will have to be walked. I'm not sure what kind of authentication the plaintiff would require, but if the telco had to check with the consumer every time the system would fall apart the same way credit card payments wouldn't work if banks had to call customers each time they tried to use one. Here's hoping the courts can solve what is a pretty serious problem without throwing the baby out with the bathwater.