Sprint To Disconnect Early Termination Fees

A Sprint spokesperson confirmed the company's plan and said, "We will be prorating our early termination fees this year (as we committed to last year). We have not yet announced any further details of what the policy will be. It will happen before the end of the year."

Back in November 2007, the Overland, Kansas-based company said it planned to implement a new prorated ETF policy back sometime in 2008, but it has been accused of dragging its feet. The carrier became the subject of a July class action lawsuit in California for trying to thwart subscribers from ending their contracts early by charging them hefty fees.

In the case, Alameda County Superior Court Judge Bonnie Sabraw ruled that early termination fees are illegal. Sabraw said that Sprint had to refund $18.2 million to subscribers who already paid for severed contracts. She also ordered the carrier to cease and desist from its efforts to collect an additional $54.7 million from other customers who hadn't yet shelled out money to pay such fees.

"We're disappointed," Sprint spokesman Matthew Sullivan told The Mercury News. Sullivan said that the ruling was tentative and that the judge needed to give Sprint more time for an appeal.

Sprint has not been alone in its tangles with the judiciary system regarding ETFs. In early July, rival Verizon Wireless agreed to a $21 million settlement in a similar suit. In addition to Verizon, AT&T and T-Mobile now prorate their fees.

In the midst of all the litigation, the Federal Communications Commission began examining ETFs, and tried to determine how it could implement rules to protect consumers in the future.

FCC Commissioner Kevin Martin said that between 2006 and 2007 the agency received over 3,700 complaints about ETFs. He said that customers were not aware of charges until they received their first bill which notified them that a trial period was over, and that they could be subject to ETF penalties of $150 to $200 if they cancelled their plans.