By Monica Alleven
AT&T says it has obtained final judgments and permanent injunctions against defendants in four more federal lawsuits filed as part of its efforts to go after phone traffickers.
AT&T’s latest wins follow a string by other players in the prepaid industry.
T-Mobile USA has successfully pursued legal action, as well as smaller companies like
TracFone.
To date, AT&T has filed 14 lawsuits against companies and individuals in Texas, Florida, California and New York in an effort to stop people from buying prepaid phones in bulk and re-programming them for sales at jacked-up rates. So far, its lawsuits have resulted in a total of 15 permanent injunctions and final judgments totaling $51 million in damages, the carrier says. AT&T expects to file additional lawsuits.
In order to make prepaid phone service affordable for customers, AT&T subsidizes the cost of certain GoPhone prepaid handset models and recoups the subsidy through the sale of airtime. But that model goes out the window when traffickers scoop up the phones, which are then resold without manufacturer’s warranties, accessories or user manuals.
AT&T says because the phones may still carry AT&T branding, consumers may mistakenly believe they are purchasing handsets still covered by original warranties.
In the four latest cases, AT&T was awarded judgments of $3 million to $5 million in damages.