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Watchdog wants tough message sent to Sprint

July 12, 2007|James S. Granelli | Times Staff Writer

Cellphone companies are notorious for socking customers with hefty fees if they want to get out of their contracts early. Now, some people believe Sprint Nextel Corp. ought to get a taste of its own medicine.

Sprint's decision to dismiss 1,100 customers for complaining too much prompted Mindy Bockstein, chairwoman of New York's Consumer Protection Board, to ask the company Wednesday to pay $200 in termination fees to each of the customers.

"If someone adheres to a contract and pays for service that carries a termination fee for quitting, it should be a two-way street," she said.

Sprint, the nation's third-largest cellphone carrier, believes that it already has provided adequate compensation: waiving its $175 termination fee and the customers' final monthly bills.

"We just felt we couldn't serve them anymore," spokesman William K. White said. "And we thought that letting them go to another carrier would make them happier. If they continue to call us after six months, they're clearly not happy."

Among those whose contracts were severed, White said, were people who called repeatedly to seek credits, to ask for phone records on another person's account and to get new handsets because the previous four or five didn't work. In many cases, he said, customers repeatedly called on matters that the carrier believed it had fixed or they repeatedly posed questions that the company, by law, couldn't answer.

In a little over six months, the 1,100 users called the customer service line 40,000 times, White said. Sprint fields an average of one inquiry every two months from each of its 53 million customers.

At the end of June, Sprint sent letters to the 1,100 customers saying the number of service calls they made "led us to determine that we are unable to meet your current wireless needs."

Bockstein, whose board has little regulatory authority over wireless carriers, was unsure if the compensation was sufficient.

"While you may feel this action is justified by the behavior of these customers, the [state board] is concerned that ultimately these customers are not being treated fairly," she wrote to the company Wednesday.

In an interview, Bockstein said, "They seem to be cherry-picking customers, and that signals a troubling trend."

Neither her office nor California's Department of Consumer Affairs registered any complaints about the terminations.

The Utility Reform Network, a San Francisco consumer advocacy group, said Sprint should look at its policies to see what might be generating such calls. "We are concerned any time customers are getting a message from their phone company that having questions is not acceptable," said Bob Finkelstein, the group's executive director.

"We would agree that customers shouldn't make nuisances of themselves," he said. "On the other hand, the high price of cellphone plans includes customer service."

One customer who is being bounced isn't happy.

Rene, a 29-year-old Miami resident who complained on an Internet chat site but would not give her last name, said in an interview that she was a Sprint customer for nearly eight years and signed a new two-year contract six weeks ago after buying a $400 Treo handset.

She said the high number of calls attributed to her started about six months ago with a billing issue on a new plan.

"The reps were nice and apologetic, but I believe that although the problem looked solved, the system ... ultimately kept making errors," she said.

In addition, she said, Sprint counted as separate calls every transfer for which she had to enter her number and password again and every call made after one was dropped. Sprint never returned any calls it had promised to, she said, forcing her to make more calls.

White said Sprint thoroughly investigated before making its decision. The high number of calls from them, he said, affected the company's ability to serve the rest of its customers, a term in the contract that allowed the company to take the action.

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james.granelli@latimes.com

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