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State AGs tout settlement with 5G providers over misleading ads
Ads about 'unlimited' data, 'free' phones and other promotions sparked attorneys general from all 50 US states to pursue $10.25 million in civil penalties against AT&T, T-Mobile and Verizon. #pressrelease
May 10, 2024
3 Min Read
Minnesota Attorney General Keith Ellison today announced he has joined all 50 states in settlement with AT&T Mobility, LLC, T-Mobile USA, Inc., Cellco Partnership, d/b/a Verizon Wireless, Cricket Wireless, LLC, and TracFone Wireless, Inc., which resolves the state attorneys' general investigations into the carriers' deceptive and misleading advertising practices. As part of the settlement, Minnesota Attorney General Keith Ellison filed Assurances of Discontinuance against AT&T, T-Mobile, and Verizon Wireless.
"AT&T, T-Mobile, and Verizon Wireless spread deceptive and misleading advertisements that tricked consumers into believing that they were obtaining better deals than the company was actually offering," Attorney General Ellison said. "AT&T, T-Mobile, and Verizon Wireless baited consumers with deceptive claims about 'unlimited' data, 'free' phone offers and incentives to switch, only to switch the offer and not deliver on their advertised claims. Today's settlements put an end to these fraudulent advertising practices."
The settlements address the common misleading advertising practices of the Wireless Carriers, including misrepresentations concerning: (1) "unlimited" data advertisements, which failed to clearly and conspicuously disclose material limitations; (2) "free" phone offers, which failed to clearly and conspicuously disclose material conditions; (3) monetary incentives to "switch" wireless networks, which failed to clearly and conspicuously disclose how the monetary incentives would be provided; and (4) wireless carrier plan comparisons, which failed to disclose material differences.
The settlements will, among other things, require the Wireless Carriers to:
make all future advertisements and representations truthful, accurate, and non-misleading;
refer in marketing to "unlimited" mobile data plans only where such plans do not set any numerical limits on the quantity of data allowed during a billing cycle and clearly and conspicuously disclose any restrictions on data speed, as well as the triggers of such restrictions;
offer to pay for consumers to "switch" carriers only where they clearly and conspicuously disclose the type of fees and amounts that they will pay consumers, the form and schedule that such payment will take and all material requirements that consumers must satisfy in order to qualify and receive such payment;
offer wireless devices or services for "free" or similar terms only where they disclose clearly and conspicuously all material terms and conditions that the consumer must meet in order to receive the "free" devices or services;
make offers to lease wireless devices only where it is made clear to the consumer that the consumer will be entering into a lease agreement;
make representations that a consumer will save money by purchasing its products or services only where it has a reasonable basis to do so based on comparisons with the prices of comparable goods or services of other providers, or where any material differences between those goods or services are clearly and conspicuously disclosed; and
appoint a dedicated employee to work with the attorneys general to address ordinary complaints filed by consumers;
train their customer service representatives who speak with consumers to comply with these terms and implement and enforce a program to ensure compliance with these terms.
The settlement also ensures the companies will pay approximately $10.25 million in civil penalties to the 50 states, including approximately $146,000 in civil penalties to Minnesota: approximately $35,000 from AT&T, $69,000 from T-Mobile, and $42,000 from Verizon Wireless.
Read the press release here.
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