iPad and iPhone Users Sue AT&T for Overbilling Customers

Categories: Business, Tech
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Small phone, huge bill
iPad and iPhone users might want to take a quick look at their phone bills -- they could be getting ripped off.

In a class action lawsuit filed last week in San Francisco, millions of iPad and iPhone users are suing AT&T for overbilling customers and overstating web traffic by as much as 14 percent and in some cases more than 300 percent. This means users are paying for more service than they used or service they never used at all.

So if a iPhone user downloaded a 50 KB Web site, AT&T would overstate the traffic as 53.5 KB, according to the lawsuit.

In addition, plaintiff Patrick Hendricks, who is representing the class in the lawsuit, claims that the company is also billing for "phantom traffic," which means AT&T is claiming a customer is downloading data when in fact they are not. 

"AT&T's billing system for iPhone and iPad data transactions is like a rigged gas pump that charges for a full gallon when it pumps only nine-tenths of a gallon into your car's tank," the lawsuit states.

An independent consulting firm retained by the plaintiff, discovered the overbilling. The extra charges have "a modest effect" on customers' bills, yet give the company's bottom line a huge boost, the lawsuit says.

The consultants discovered this when they conducted an experiment. They bought a iPhone from an AT&T store, disabled services, made sure there was no e-mail account configured, and closed all the applications, and let the phone sit unused for 10 days.

During that time, AT&T billed the phone's account for 35 transactions, which is like "the rigged gas pump charging you when you never even pulled your car into the station," according to the complaint.

AT&T has 92.8 million customers and reported an increase of more than $1.1 billion in wireless data revenues in the fourth quarter of 2010. A major portion of that increase was due to the "rigged" billing system, the claim states.

Previously, AT&T has been sued for charging customers for downloads they never made and it reneged on billing plans while charging customers for services it never delivered, according to the lawsuit.

Hat tip: Courthouse News Service

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6 comments
I Hate ATT
I Hate ATT

THANK GOD!  I hope ATT pays big!

SFist
SFist

This pleases me.

P P
P P

I have called & complained about phantom data usage. @ 3am when im home on wifi. large chunks of data are being used. Att blamed it on apple. I called apple who bridged in at&t to notify at&t to stop blaming apple. at& t talked in circles & could not explain in clarity where the usage was comming from. Apple instructed me to turn off the 3g & cellular data to stop the phanthom usage. Once i did that i was able to control my data usage. It sucks because i do not get mms messages when it is off & i have to keep turning it on & off.

Marlenee
Marlenee

At&t has done the blame game to me as well. Here's how to get get even: After moving to my dream apartment, I started paying for a service is practically null in my neighborhood. When I tried to fix the problem, AT&T offered me sales solutions that cost me more money (mini cell phone tower and other ridiculous solutions). To cancel my contract would cost 200 bucks. So for fun, I simply call AT&T to talk about the problem, then claimed I can't hear the operator because the phone was breaking up.... even though I hear every shout and cry and repeated ironic "can you hear me now?" It annoys them to no end, waste AT&T's time, money and an evil way makes me feel really good. If every annoyed AT&T customer did this once a month, I bet they would change their ringtone.

JohnQPerson
JohnQPerson

I had the same issue on my phone, I was getting late night charges and even during the day when I was on wifi networks. What I did was dispute that it never happened because the phone did not record these data transfers, only At&t did. My phone said I had 46mb total and At&t recorded +150mb. Apple told me there was NO way for the phone to transmit data without recording it with the At&t rep on the phone so I had solid ground to stand on.

Keep resetting your phone data every billing cycle and screenshot the usage. They yielded when I presented all this info and eventually even admitted the problem.

John
John

That is totally ridiculous! I'm going to assume you're not on an "unlimited" plan?

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