California Appellate Court Revives Lawsuit Regarding Rounding Up of Cell Phone Minutes

by Mike Mintz on September 17, 2012 · 1 comment

in Litigation

Ever wonder why your cell phone bill is so high? Ever think the minutes recorded on your cell phone bill do not reflect your actual usage time? Well, you’re probably right on both counts, and an appellate court recently revived a lawsuit regarding just these issues entitled Tucker v. Pacific Bell Mobile Services, California First Appellate Court.

Plaintiffs alleged in a lawsuit first started in 2003 that defendants’-cell phone companies’ advertisements and other promotional materials misrepresented or did not sufficiently disclose their policy of rounding up the usage minutes in violation of California’s Unfair Competition Law (“UCL”) and False Advertising Law.   The lawsuit was brought against Cingular Wireless and Pacific Bell Mobile Services.

Plaintiffs had repeatedly sought to have a class certified of all customers of the defendants who subscribed to a term contract for wireless services for a specified period of time. The complaint sought monetary damages, restitution and injunctive relief.  The lower court declined to certify a class, noting that individual issues predominated over common questions of facts and law.  The plaintiffs then filed the instant appeal.

The UCL provides for three types of unfair competition: practices which are unlawful, unfair or fraudulent.  Plaintiffs presented claims under all three types of “unfair competition”.  The first cause of action was for unlawful business practices, the second for unfair business practices and the third for fraudulent business practices.

The UCL defines unlawful business practices according to its commonly understood meaning- as anything that constitutes a business practice and is also forbidden by law.  A fraudulent business practice is one where the public is likely to be deceived.  The UCL fraud provision is different from common law fraud because the UCL fraud cause of action does not require proof of deception, reliance and injury.  The catch is that under the UCL, no monetary relief is allowed, only equitable relief including injunction and restitution.

A class action for a fraudulent business practice claim under the UCL requires that the defendant have engaged in uniform conduct against the class which is likely to mislead all of them.  If issues of materiality or reliance vary from consumer to consumer, i.e. plaintiff to plaintiff, then the issue cannot be subject to common proof and the action cannot be certified as a class action.  The court concluded that whether members of the proposed class were aware of the defendants’ policy of rounding up minutes and whether the proposed class members were misled by the association of a certain number of minutes to a rate plan requires separate inquiries to be made of each individual potential plaintiff.  The court could not find that there was an inference of common reliance of the proposed class on the defendants’ alleged misrepresentations.  The proposed plaintiff class also encountered a stumbling block regarding its relief for restitution.

The proposed class could not avail itself of a claim for restitution because such a claim requires the return of a measurable amount of money that inures to the plaintiffs. Here, no such amount existed.

However, the court did conclude that plaintiffs’ claims for injunctive relief could go forward since the UCL does allow for the imposition of such equitable relief. The court left it up to the trial court to determine whether the claims for injunctive relief could be decided as a class action lawsuit—that issue was not before the appellate court.

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California Appellate Court Revives Lawsuit Regarding Rounding Up … | Pro Phone Cards
September 17, 2012 at 12:18 pm

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