T-Mobile Sued For Allegedly Disguising $3.49 Fees

KEY HIGHLIGHTS:

• 23 plaintiffs sued T-Mobile for allegedly charging customers with hidden fees disguised as government charges already for two decades
• Customers pay $3.49/month for RPTR, which represents a 28% increase over the last eight years
• Verizon faced the same lawsuit last year, paid a $100-million penalty, but continues to charge RPTR

Mobile network giant T-Mobile USA Inc. is facing a class action lawsuit over allegedly charging its customers with hidden fees disguised as government charges.

Reports over the weekend said that 23 plaintiffs filed the lawsuit with the California federal court, alleging that they were being charged for two decades for what the company calls the Regulatory Programs and Telco Recovery Fee (RPTR).

They said the fees were misrepresented as a government charge.

“To conceal these illegal fees, T-Mobile includes the RPTR Fee in the section of their customer’s monthly bill that bundles this fee with ‘Government Taxes and Fees’ to disguise it as a required government charge, passthrough fee, or other regulatory-mandated fee,” the plaintiffs claimed.

“In reality, the RPTR Fee is a concoction designed to increase T-Mobile’s revenue and pad its bottom line,” they added.

The RPTR fee which was introduced in 20024 was said to have already increased by 28 percent over the past eight years. At present, the company charges its customers $3.49 per month for RPTR.

The plaintiffs said the fees were unfair as they were not strapped to any benchmark and can change at the company’s discretion, and were also not mentioned in their T-Mobile Subscriber Agreement.

The plaintiffs attempted to resolve the case through individual arbitration claims through the American Arbitration Association, but T-Mobile allegedly would not participate. They were seeking an unknown amount in damages.

‘RPTR helps defray funding, government programs’

T-Mobile defended the RPTR Fee, saying that it is a common charge among all cellular providers.

According to the company, the regulatory programs component of the fee helps the company defray the costs of funding and complying with government mandates, programs and obligations.

Meanwhile, the Telco Recovery part helps T-Mobile pay for “costs and charges” imposed by other carriers for the delivery of calls, and for network facilities, operations and services.

Even Verizon was slapped with similar charges last year.

While not admitting fault, Verizon paid out $100 million to avoid bringing the case to the courts. However, Verizon still charges customers for RPTR and has even raised it recently.

The recent lawsuit against T-Mobile was filed to shine a light on the company’s potential deceptive pricing and inclination to hide fees. The class action suit could ultimately affect millions of the service provider’s customers. Should the plaintiffs prevail, T-Mobile will need to take a serious look at its pricing structure and its inability to provide clear billing terms.