Verizon Wireless Settles with New York, Will Reimburse EV-DO Customers

This afternoon, New York Attorney General Andrew Cuomo's office announced that Verizon Wireless had reached a settlement with the state, which had earlier accused it of wrongfully terminating about 13,000 accounts of customers of its "Unlimited" nationwide Internet service, for excessive usage.

A nine-month investigation by the A-G's office determined that Verizon Wireless had actually instituted a monthly usage cap for its "NationalAccess" and "BroadbandAccess" service tiers, without disclosing that cap to its customers.

Bandwidth caps were also found to be in place, throttling customers' use of high-intensity services such as streaming and gaming. Those limitations apparently were disclosed within the company's Terms of Service, but apparently not in a conspicuous location that customers might actually be able to locate.

"Your National Access and/or Broadband Access service is scheduled to be disconnected on the above mobile number on mm/dd/yy," read one notice a customer received via e-mail. "Please contact Verizon Wireless immediately at 866-221-xxxx...Unusually high data activity may indicate misuse of service."

As one user of the EV-DO Forums wrote, "I live out in the country and so of course I use this for my primary ISP. And like many of you, I have it set up to share with six other computers. So of course I have high data activity, but the last time I checked that's why I am on the supposed unlimited plan, which apparently is not unlimited."

"This settlement sends a message to companies large and small answering the growing consumer demand for wireless services," stated Attorney General Cuomo this afternoon. "When consumers are promised an 'unlimited' service, they do not expect the promise to be broken by hidden limitations. Consumers must be treated fairly and honestly. Delivering a product is simply not enough - the promises must be delivered as well."

The company reportedly terminated those accounts between 2004 and April 2007. It has agreed to reimburse those customers as much as $1 million, which adds up to $76 and change per customer impacted.