California consumers stand to gain.
Blawgletter just got back from trying a class action case for five weeks against AT&T in Kansas City, Kansas. The federal jury didn't find that AT&T conspired to fix prices but that AT&T did breach its contract with California residential long-distance customers. The eight-person panel unanimously awarded the class $16,881,000. With prejudgment interest, the award would grow to about $26 million.
Per the Associated Press (by way of Houston Chronicle):
KANSAS CITY, Mo. — A federal jury has ordered AT&T Inc. to pay almost $17 million for overcharging customers in California when passing along a federally mandated phone fee.
But in the verdict reached late Wednesday, the Kansas City, Kan., jurors determined there wasn't enough evidence showing the telecommunications giant conspired with Sprint Nextel Corp. or then-competitor MCI to overcharge customers nationwide for the Universal Service Fund.
"We're gratified that the jury correctly found no evidence of antitrust activities," Michael Coe, a spokesman for Dallas-based AT&T, said in an e-mail. "We're studying our options on the breach-of-contract ruling involving California residential customers, and continue to believe we acted properly."
Barry Barnett, a lead attorney for the plaintiffs, said his side was "very pleased" with the decision regarding the California customers and would ask the judge to add up to $10 million in pre-judgment interest to the award.
Barnett said U.S. District Judge John W. Lungstrum hasn't yet decided how much of the award will go to attorneys fees, and they haven't determined how the award will be paid out to the class members.
He said the plaintiffs were deciding whether to appeal the decision on the antitrust accusations.
The antitrust case consolidated dozens of class-action lawsuits filed across the country and covered customers who paid into the Universal Service Fund between Aug. 1, 2001, and March 31, 2003.
The fund subsidizes the cost of running phone service to rural areas, low-income customers and public facilities, such as schools, libraries and rural hospitals.
Carriers are required to contribute to the fund a percentage of their gross revenue from interstate and international calls. The Federal Communications Commission sets the contribution rate.
AT&T described the fee on its bills as a "Universal Connectivity Charge."
After a five-week trial, jurors agreed AT&T had violated its contract with its California residential customers, a subset of the class-action members, and awarded $16.9 million.
Sprint was a co-defendant in the case. But the Overland Park, Kan.-based company agreed in September to settle its involvement for $30 million.
We've now gone to trial in three class cases. And we can't wait for the next one.
