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Mobile phone service to pay settlement for deceptive practices

When companies compete fairly and according to the applicable laws, we all benefit: customers get the most for their money and companies can reap the financial rewards. Further, competition can spur innovation as companies create new products and services to capture the marketplace. Yet, this whole system becomes undermined when companies employ deceptive trade practices in order to lure customers.

Recently in San Francisco, a $45 million settlement was approved by a federal judge in a class action lawsuit brought against TracFone, a mobile service provider. The suit was based on allegations that TracFone made false claims pertaining to a number of its unlimited data plans.

According to the class action, which was filed in part under Florida's Deceptive and Unfair Trade Practices Act, the company used deceptive advertising to entice consumers to make purchases on a variety of prepaid plans. However, the suit states that after acquiring the plans, customers found their service severely impeded or suspended after reaching a 30-day data limit.

The Federal Trade Commission is authorized to distribute $40 million of the settlement among eligible TracFone customers. The rest of the money is earmarked for legal fees and other expenses.

When a company misrepresents its wares, both consumers and competing companies suffer. The money customers give to deceptive companies is taken away from companies who choose to do business the right way. Additionally, the customers do not receive what they believed they paid for.

If your business is ever harmed by the deceptive practices of another company, either by creating unfair competition or by failing to deliver a good or service as promised, you may wish to take legal action. An experienced Florida business litigation attorney could possibly represent your interests.

Source: Courthouse News Service, "TracFone Pays $45 Million for Deceptive Ads," Philip A. Janquart, July 8, 2015

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