Verizon will pay up to $64.3 million in cash and phone credits to resolve a long-running class action lawsuit that accuses the phone giant of cheating subscribers to its Family SharePlan, which offered a way for members to share minutes and call each other for free.
According to a proposed settlement filed last week in New Jersey, Verizon subscribers who belonged to a family plan between 2001 and 2006 will begin receiving notifications once the judge approves the preliminary arrangement.
The underlying lawsuit claims that Verizon over-billed plan members in one of two ways: 1) by charging plan members for “in-network” minutes that were supposed to be free; 2) by charging the addition phones included in the Family SharePlan 45 cents a minute for exceeding an allotted monthly allowance, rather than the 25 cents that was charged to the primary phone in the plan.
The settlement calls for [company]Verizon[/company] to pay $37.5 million into a fund that will be distributed as cash or phone bill credits to both groups. It also calls for the company to supply members of the “in-network” group with PIN numbers that can be used for domestic or international calls, and are valued at $27.5 million dollars under the deal.
Verizon declined to comment on the settlement.
The proposed payout is just one of a recent spate of “phone companies behaving badly” stories. This month, [company]AT&T[/company] agreed to pay $105 million over claims it crammed customer bills with bogus text charges, while the FTC filed an unrelated lawsuit on Tuesday against AT&T that accuses it of illegally throttling the data speeds of certain customers.
Here’s a court filing, spotted by Top Class Actions, that describes the settlement. (You can find most of the relevant details on page 63.)