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US: Cingular Accused of Deception

by Jolayne HoutzThe Seattle Times
July 7th, 2006

Wireless pledged to "raise the bar" for 22 million AT&T Wireless customers it acquired when the two companies merged in 2004 — better coverage, same rates and phone no service interruptions.

Instead, customers have faced excessive fees, poor service, dropped calls and a network that has not been maintained, part of a campaign to push former AT&T Wireless customers to switch to Cingular, a lawsuit claims on behalf of those customers.

The suit, which seeks class-action status, was filed Thursday in U.S. District Court in Seattle.

Cingular, now the biggest U.S. cellphone company, purposefully dismantled AT&T's network and downgraded subscribers' service, the suit claims.

As service deteriorated, former AT&T Wireless customers were left with three choices, the lawsuit alleges:

• Move to Cingular, which in some cases involved an $18 transfer fee, purchase of a new phone and an $18 chip to enable it to operate, and a new service contract with less-favorable terms.

• Pay an early-termination fee, usually $175, to cancel service before the AT&T contract expired.

• Stay on as an AT&T Wireless subscriber to fulfill the contract but receive poor service.

The lawsuit charges that Cingular engaged in deceptive advertising, breached contracts and violated consumer-protection laws in all 50 states. It covers everyone who was an AT&T Wireless subscriber on Oct. 26, 2004, when the merger with Cingular was completed.

It names Cingular, AT&T Corp. and AT&T Wireless, formerly based in Redmond, as defendants.

"AT&T promised a seamless transition," Seattle attorney Michael Withey, representing the plaintiffs, said Thursday at a news conference. "AT&T failed to deliver. They put their profits ahead of promises."

Cingular executives were still reviewing the lawsuit and could not comment, spokeswoman Anne Marshall said. Cingular spent $6.5 billion on network integration and upgrades last year, she said.

The lawsuit seeks punitive damages against Cingular and the repayment, with interest, of fees customers paid to terminate, upgrade or transfer service.

Architect Amy Frerker, one of seven who sued on behalf of all customers, said she started noticing dropped calls during her commute from Green Lake to Leschi after the merger.

Cingular told her it was a temporary maintenance issue or perhaps a problem with her phone. But dropped calls and system-busy signals persisted

Frerker tried to get out of her contract and was told it would cost $175 for each of the two phones on the account. She decided to get a new phone, but Cingular said it no longer carried the phones she wanted.

Last week, Frerker said Cingular finally agreed to terminate her contract without charging her.





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