Jacobs Kolton, Chtd., David Schachman & Associates, P.C., Keller Grover LLP and Lieff Cabraser Heimann & Bernstein, LLP announced today that a class action settlement has been reached that will make it possible for Verizon landline customers to receive 100% refunds for unauthorized third-party charges. The settlement, preliminarily approved by United States District Court Judge Saundra Brown Armstrong, comes in a suit alleging that Verizon billed its landline phone customers for charges from third-party companies that were not authorized by the customer (a practice known as “cramming”), in violation of federal and state law.
Verizon denies any wrongdoing. Both sides have agreed to settle the lawsuit to avoid the cost, delay, and uncertainty of litigation. The settlement was negotiated under the supervision of retired judge Daniel H. Weinstein.David Schachman, one of the lead counsel for the class, commented, “This is a truly excellent result for the class. Verizon is to be commended for demonstrating its commitment to protecting its customers from unauthorized third-party charges and providing a make-whole remedy to those who paid unauthorized third-party charges.” Fellow Class Action Lawyer Jahan C. Sagafi, of Lieff Cabraser Heimann & Bernstein continued, “Unfortunately, cramming is widespread today because people often don’t even realize that they have been billed. Many consumers have been billed for months and even years for these third-party charges without even knowing it. That is why it is so important for customers to get the free billing summaries that this settlement provides so they can check to see if, in fact, they paid third party charges and determine whether they authorized them.” Class Action Lawyer Bryan Kolton added: “Some settlement class members may have a claim for hundreds or thousands of dollars in refunds under the settlement.” Kolton added that one of the significant benefits available to the class is Verizon’s agreement “to provide summaries of all third party charges, for free, and in customer-friendly fashion, to any Class Member that requests the summary.” According to Kolton, this will help customers find out if they paid these charges and, if so, will make it easy to obtain a refund of 100% of any unauthorized charges.
As part of the proposed Settlement, Verizon has also agreed to require various specific changes to billing practices that are designed to prevent cramming in the future. John Jacobs, one of the lead counsel for the class added, “It is difficult to overstate the credit that is due Verizon for its commitment to fixing the third-party billing system as it relates to Verizon customers. By this settlement, Verizon has committed to extensive and unprecedented changes that we believe will go a long way toward eliminating cramming and will change the industry.” For example, under the settlement, “for all new landline customers, most third-party charges can be included in the customer’s phone bill only if the customer first explicitly agrees to permit third-party charges on their bills.”According to Class Action and Consumer Protection lawyer Jeffrey Keller, “Everybody associated with this settlement worked hard to reach this remarkable result. We are all extremely proud of the benefits this settlement will provide to Verizon’s customers.”
Refund Procedure Verizon landline phone customers nationwide (including individuals, businesses and local governmental entities) who were billed for third-party charges from April 27, 2005 through February 28, 2012 will be able to recover 100% of all money they paid in unauthorized third-party charges during that period by submitting a “Full Payment Claim” or recover a refund of $40 by submitting a “Flat Payment Claim.”