The Federal Trade Commission opposes a proposed class-action settlement in phone cramming litigation against Verizon Communications, Inc.
In an amicus brief filed in federal district court in California, the FTC argues the settlement is not adequate, fair or reasonable.
The agency said its major beef with the settlement is that class members who don't opt out of it would be barred from asserting claims against Verizon, billing aggregators and third-party merchants. The settlement notice, the FTC asserts, doesn't reveal this fact.
"These consumers waive any ability to recover their losses despite the fact that they did not obtain financial recovery under the settlement," the FTC wrote in the court filing.
Verizon is aiming to settle a lawsuit that claims the telecom titan allowed billing aggregators and third-party merchants to place unauthorized charges on their phone bills.
Under the proposed settlement, class members can either submit a claim to recover a $40 flat payment or file a claim for full reimbursement of all documented unauthorized charges, according to the FTC.
Daniel H. Weinstein, a former judge, served as a mediator in the litigation pending in the U.S. District Court for the Northern District of California. Weinstein reached a different conclusion than the FTC concerning the fairness of the settlement, and Verizon agrees with that assessment.
"We (Verizon) agree with the mediator involved with the Moore class action case that the settlement 'is not only fair, reasonable and adequate, but is a truly excellent settlement that provides substantial monetary benefits to the class and unprecedented injunctive relief,'" Verizon spokesman Bill Kula said.
The FTC is not a party to the litigation but asked the court for permission to file a brief in light of its experience as a government agency cracking down on phone cramming practices.
