On behalf of Wolf Popper LLP
Large corporations that offer consumer products and services have a lot of power over consumers. Almost always, consumers are at a disadvantage in negotiating the terms of agreements and have to trust that the company is going to do right by them and deliver on their promises. Of course, businesses do not always deal fairly with consumers, and this is particularly evident in the area of cable and Internet services.
Here in New York, Attorney General Eric Schneiderman filed a consumer fraud lawsuit earlier this month against Internet company Time Warner Cable (TWC), which is now owned by Charter Communications and operates under the brand Spectrum. The company is accused of defrauding and misleading Internet service customers by promising Internet speeds and reliable access to online content it knew would be unable to actually deliver.
As part of this scheme, the suit alleges, TWC leased equipment to customers that was unable to support the quality of Internet connection that TWC promised and advertised. The suit alleges that this occurred over a period of at least five years, earning the company an estimated $108 million per year in fraudulent revenue from up-charging for Internet services.
On top of that, TWC is accused of misleading the Federal Communications Commission by representing that TWC would replace subscribers' substandard cable modems. What the cable company actually did was to replace subscribers' hardware and make adjustments to their modems to provide temporarily for additional bandwidth for faster Internet service. The company's own internal memos apparently admit this. Internal memos also apparently include recommendations that the cable company advertise, based on the temporary increase in Internet speed, that they actually deliver faster speeds than they promise.
In our next post, we'll continue looking at this lawsuit, and the importance of consumers working with an experienced attorney to protect their rights and represent their interests against businesses who engage in consumer fraud.