New York City is suing T-Mobile over what it described as "pervasive" and predatory sales tactics conducted by dozens of the company's Metro locations, activity the city claims was not just "violent," but also illegal.
A complaint filed in the state Supreme Court in Manhattan and first reported by Reuters, asserted that these sales practices were "lush in Metro stores", and further claimed that T-Mobile and its subsidiary are responsible for activity in 56 stores throughout the city that violates the Consumer Protection Act. Among the charges, the complaint accuses stores of selling used phones pretending to be new, as well as charging customers for unwanted services and enrolling them in pay plans without first obtaining their consent.
engages in a financing offer with a third party company that allows customers to pay off their unit in monthly installments. But the complaint states that consumers can pay in excess of hundreds or even thousands of dollars for the phone's selling price with this system.
The complaint cited one example of a woman who bought a phone for $ 599 through a metro dealer, but was charged between $ 1,592 and $ 2,191 more than the advertised price. (The complaint further alleges that an employee misreported the phone's purchase price as about twice the value of the financing contract, but states that even then the markup would still have been $ 1,041 more than the stated price.
"With this scheme in place, defendants have asked NYC consumers about things as basic as the actual price of the phone for things as complicated as the terms of financing, "the complaint states.
In addition to fees, financing and mistakes about whether a device is actually new, the complaint alleges that Metro is also misleading customers about the right of return, as the complaint states that Metros announced its 30-day warranty is "completely illusory" because the company's online website is set up to require customers to purchase units in the store, but also has in place a seven-day return policy for the purchase of persons.
The complaint alleges that T-Mobile is responsible for at least 2,260 violations and seeks $ 350 per incident, or $ 500 per offense, so it was a knowing breach.
"We take these claims very seriously and continue to investigate so that we can respond to the city," a T-Mobile spokesperson told Gizmodo in an email statement. "Although we cannot comment on the specific allegations at this early stage, what we see here is in complete contravention of the integrity of our team and the commitment they have to taking care of our customers every day."
T-Mobile is also currently facing a multi-state action that seeks to prevent the merger with Sprint in the face of antitrust issues. Attorney Kwame Raoul this week became the 17th lawyer to join the lawsuit. In a statement this week, New York Attorney General Letitia James called the merger "bad for consumers, bad for workers and bad for innovation."