Class action lawsuit calls out AT&T for aiding cellphone thieves for profit

Sunday, April 29, 2012 by: J. D. Heyes
Tags: cell phones, thieves, lawsuit

(NaturalNews) A class action lawsuit filed against AT&T alleges the telecom giant aids and abets cell phone theft by reactivating phones that have been stolen, in addition to fraudulently informing customers the company cannot block calls to and from their stolen phones so they will have to buy new ones.

Papers filed in Superior Court in Sacramento, Calif., April 11 say the company does that "in order to make millions of dollars in improper profits, by forcing legitimate customers [...] to buy new cell phones, and buy new cell phone plans, while the criminals who stole the phone are able to simply walk into AT&T stores and 're-activate' the devices, using different, cheap, readily available 'SIM' cards (computer chips)."

The suit, filed by three Californians, alleges that AT&T committed conspiracy, fraud, breach of contract, accessory to theft, unfair trade and other improper practices.

In court papers they allege that, "on a regular daily basis in California and elsewhere, the cell phones, Apple Computer Corporation 'iPhones' in particular, are stolen by criminals from lawful purchasers and users."

Deception - for years

The plaintiffs say in their complaint that today's cell phone technology is such that it makes them easy to identify who they really belong to, making it difficult to understand why AT&T would reactivate phones reported as stolen. Unless, of course, it's all about the bottom line.

"Each such cellular device is identifiable, as a handheld cell phone, by the IMEI imprinted on same, and said serial number is readily visible to, and apparent to, any and all stores, businesses, and defendant employees when the device is activated or a new cell phone usage plan is turned on by defendants," says the complaint.

"Nevertheless, for years, defendants have actively and without reservation aided, abetted, and assisted thieves, i.e., possessors of stolen cell phones, in earning illegal theft profits, by turning back on, or 're-activating' said stolen phones."

The plaintiffs said they were "told by AT&T representatives that they will not, and 'cannot,' block and effectively kill usage of such stolen cell phones by thieves and criminal organizations[;] however, such representations are false and fraudulent."

The plaintiffs said AT&T has engaged in such deception for years, forcing customers to buy new phones and new plans, letting the thieves off easy by allowing them simply to reboot the stolen booty with a new SIM card.

Other suits target AT&T

The cell phone scandal, so to speak, is far from the only litigation the telecom giant is facing. A team of attorneys filed suit against the company last year after an investigation by a private consulting firm found AT&T was overstating data usage on some customer's plans by an average of 7-17 percent, and in some cases more than 300 percent.

"We were stunned to discover that AT&T billed for a phone which was left untouched for 10 days, incurring 35 data transactions totaling almost 3,000 KB during that period," Barry L. Davis of Thornton, Davis & Fein, P.A., an Indianapolis firm, told a local Fox television affiliate. That case was also filed in California.

The complaint says that AT&T reported a 27.4% increase in data usage during the fourth quarter of 2010. Attorneys in the case said a significant part of that increase is because of phantom charges by the company.

Not all court cases are going against the nation's biggest telecom. A U.S. Supreme court ruling in April 2011 said AT&T, along with any other company, could block class-action suits from customers in favor of forcing them into binding arbitration instead. That case stemmed from a California couple (trend here?) that had been charged sales tax on mobile phones that AT&T had advertised as "free." The couple believed that instance constituted a fraudulent business practice.

Sources for this article include:

http://www.courthousenews.com/2012/04/12/45547.htm

http://www.fox59.com

http://arstechnica.com