Sprint loses class action suit in battle over early termination fees

As the legal pendulum continues to swing away from cell phone carriers' early termination fees [ETFs], a judge in California this week ordered Sprint to pay $18.3 million to customers who launched a class action suit over fees charged for ending their contracts early.

Sprint must also credit another $54.5 million to customers who were charged the fees but haven't paid them yet, under the court ruling.

Although financially struggling Sprint isn't as well positioned to carry the freight, Verizon Wireless didn't fare well either in settling a similar case in California last month for $21 million just as proceedings got under way.

While the court actions in California will have no direct impact on wireless customers in other states, the Federal Communications Commission (FCC) is now considering a variety of federal proposals around what to do about ETFs. Some telecommunications companies have lobbied the FCC to protect wireless carriers from class action suits filed in state court.

At an FCC hearing in July, however, FCC Chairman Kevin Martin raised the possibility of a plan calling for all carriers, including Sprint, to reduce ETFs over the life of the contract. Some carriers -- including industry leaders Verizon Wireless, AT&T, and T-Mobile -- do so already.

As previously reported in BetaNews, at an FCC hearing in June, Martin discussed other proposals, including the prospect of levying "variable fees" based on the cost of the wireless handset.