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Court: Verizon Wireless Owes Customers $21M

Attorneys for Verizon Wireless tried to get a $21 million refund the company owed its customers reduced, but it was to no avail. An appeals court in California says Verizon has to pay the entire settlement.

It stems from a class-action lawsuit based on the wireless carriers early-termination fees. Under terms of the settlement, the plaintiffs were to each receive almost $88 in refunds, and the Court of Appeals upheld it yesterday. The participants in the lawsuit challenged the $175 fees Verizon Wireless was charging for breaking a service contract.

Scott Bursor, an attorney representing the Verizon customers, called the settlement terrific and praised the appeals court for deciding not to change it. A Verizon Wireless spokesperson told the Wall Street Journal that this brings to an end any court cases related to its ETFs.

Despite this litigation, both Verizon Wireless and its biggest competitor, AT&T, have raised their early-termination fees on smartphones and other services in the past year, in some cases, double what they were charging before. The carriers justify the fees by saying they pay a steep price for subsidizing smartphones. This California case was originally filed way back in 1999, so dont expect it to have much impact on ETFs that are currently in place.


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