Materially Adverse Clauses For All Major Cellphones – So You Can Escape Contract Without Termination Fee

Here’s a roundup of all the contract clauses regarding “materially adverse changes” for all the major cellphone carriers. When they starting charging new fees or raise the price of a service, you can use this section to argue that you need to be let out of contract without early termination fee….

(Photo: FastFords)


SPRINT/NEXTEL
When You Don’t Have To Pay An Early Termination Fee
You aren’t responsible for paying an Early Termination Fee when terminating Services: (a) provided on a month-to-month basis; (b) consistent with our published trial period return policy; or (c) in response to a materially adverse change we make to the Agreement as described directly below.

Our Right To Change The Agreement & Your Related Rights
We may change any part of the Agreement at any time including, but not limited to, rates, charges, how we calculate charges, or your terms of Service. We will provide you notice of changes that may impact you in a manner consistent with this Agreement (see “Providing Notice Under This Agreement” paragraph). Except as provided below, if a change we make to the Agreement is material and has a material adverse affect on you, you may terminate each line of Service materially affected without incurring an Early Termination Fee only if you: (a) call us within 30 days after the effective date of the change; and (b) specifically advise us that you wish to cancel Services because of a material change to the Agreement that we have made. If you do not cancel Service within 30 days of the change, an Early Termination Fee will apply if you terminate Services before the end of any applicable

Term Commitment.
The following, without limitation, will generally not be considered changes to the Agreement as contemplated in this provision and will not result in the waiver of applicable Early Termination Fees: (a) changes to our Policies; (b) changes to rates or charges that are not a core part of the rate plan package for which you contracted – for example, incidental, occasional or casual use charges and other options that do not require a Term Commitment; (b) changes to Taxes & Government Fees; or (c) changes to Surcharges, including assessing new Surcharges.

Our Right To Suspend Or Terminate Services
We can, without notice, suspend or terminate any Service at any time for any reason, including, but not limited to: (a) late payment; (b) exceeding an Account Spending Limit (“ASL”); (c) harassing/threatening our employees or agents; (d) providing false information; (e) interfering with our operations; (f) using/suspicion of using Services in any manner restricted by or inconsistent with the Agreement; (g) breaching the Agreement, including our Policies; (h) providing false, inaccurate, dated or unverifiable identification or credit information, or becoming insolvent or bankrupt; (i) modifying a Device from its manufacturer specifications; or (j) if we believe the action protects our interests, any customer’s interests or our network.

T-MOBILE
Changes to the Agreement or Charges. EXCEPT TO THE EXTENT PROHIBITED BY LAW, IF WE: (A) INCREASE THE CHARGES INCLUDED IN YOUR MONTHLY RECURRING ACCESS RATE PLAN, OR (B) MODIFY A MATERIAL TERM OF OUR AGREEMENT WITH YOU AND THE MODIFICATION WOULD BE MATERIALLY ADVERSE TO YOU, WE WILL NOTIFY YOU OF THE INCREASE OR MODIFICATION AND YOU CAN CANCEL THAT SERVICE WITHOUT PAYING A CANCELLATION FEE (WHICH IS YOUR ONLY REMEDY) BY FOLLOWING THE CANCELLATION INSTRUCTIONS IN THE NOTICE. IF YOU DO NOT CANCEL YOUR SERVICE BY FOLLOWING THOSE INSTRUCTIONS, OR YOU OTHERWISE ACCEPT THE CHANGE, THEN YOU AGREE TO THE INCREASE OR MODIFICATION, EVEN IF YOU PAID FOR SERVICE IN ADVANCE. IF THE NOTICE DOES NOT SAY HOW LONG YOU HAVE TO CANCEL, THEN IT IS WITHIN 14 DAYS AFTER THE DATE OF THE NOTICE, UNLESS A LONGER PERIOD IS REQUIRED BY LAW. EXCEPT TO THE EXTENT PROHIBITED BY LAW, CHARGES FOR PRODUCTS, SERVICES, OPTIONAL SERVICES, OR ANY OTHER CHARGES THAT ARE NOT INCLUDED IN YOUR MONTHLY RECURRING ACCESS RATE PLAN (SUCH AS DIRECTORY ASSISTANCE, ROAMING, DOWNLOADS, AND THIRD-PARTY CONTENT) ARE SUBJECT TO CHANGE AT ANY TIME WITHOUT NOTICE, AND IF YOU CONTINUE TO USE THOSE SERVICES, OR YOU OTHERWISE AGREE TO THE CHANGES, THEN YOU AGREE TO THE NEW CHARGES. VISIT OUR WEB SITE, RETAIL LOCATIONS, OR CALL CUSTOMER CARE FOR CURRENT CHARGES.

VERIZON
Our Rights To Make Changes
Your service is subject to our business policies, practices, and procedures, which we can change without notice. UNLESS OTHERWISE PROHIBITED BY LAW, WE CAN ALSO CHANGE PRICES AND ANY OTHER CONDITIONS IN THIS AGREEMENT AT ANY TIME BY SENDING YOU WRITTEN NOTICE PRIOR TO THE BILLING PERIOD IN WHICH THE CHANGES WOULD GO INTO EFFECT. IF YOU CHOOSE TO USE YOUR SERVICE AFTER THAT POINT, YOU’RE ACCEPTING THE CHANGES. IF THE CHANGES HAVE A MATERIAL ADVERSE EFFECT ON YOU, HOWEVER, YOU CAN END THE AFFECTED SERVICE, WITHOUT ANY EARLY TERMINATION FEE, JUST BY CALLING US WITHIN 60 DAYS AFTER WE SEND NOTICE OF THE CHANGE.

CINGULAR (this one probably won’t help you at all)
Changes to the terms and conditions: These terms and conditions may be changed from time-to-time. Cingular will post the most current version of these terms and conditions on the MEdia Net web site (www.cingular.com/medianet) or other appropriate location. Please check these regularly to inform yourself about changes to the terms and conditions, policies, news, etc.

CTIA CONSUMER CODE
Provide Customers the Right to Terminate Service for Changes to Contract Terms
Carriers will not modify the material terms of their subscribers’ contracts in a manner that is materially adverse to subscribers without providing a reasonable advance notice of a proposed modification and allowing subscribers a time period of not less than 14 days to cancel their contracts with no early termination fee.

“Material Adverse” Clauses in Cell Phone Contracts [UCAN]

Comments

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  1. Employees Must Wash Hands says:

    When using the “materially adverse” escape clause, do they simply release you from your contract and take you month-to-month, or do they boot you from the service altogether?

    The Sprint contract has this to say, which is what led me to believe that ending the contract early had the same effect as completely canceling the service:

    You aren’t responsible for paying an Early Termination Fee when terminating Services: (a) provided on a month-to-month basis; (b) consistent with our published trial period return policy; or (c) in response to a materially adverse change we make to the Agreement as described directly below.


    If I remember correctly, there was a similar escape window with Sprint a few months ago. I was afraid to use it lest they cancel the account and my phone number goes away forever.

  2. lhutz34 says:

    Verizon’s contract is pretty clear that the only remedy is to “end the affected service,” i.e., cancel the plan. The few who have successfully escaped report that they will often cancel the service immediately.

    Keeping your number is tricky, but if you tell them you’re porting your number ahead of time, they are required to hold it for you while you change providers, even if you cancel under this ETF escape clause. I don’t trust them to actually do this, but I have not heard any reports of people losing their number, so it seems like they’re following the rules.

    Not that AT&T is much of an improvement over Verizon, but my plan is to use the May 1 hike in Mexican roaming to get out of VZW sometime in June (within 60 days) and pick up an iPhone (released in mid-june) with AT&T, hopefully with the same number. AT&T seems to change their terms pretty regularly as well, so I’m not too concerned about the contract. I may like them just fine, and if not, I can get the phone unlocked and jump to T-Mo the next time AT&T decides to hike some random fee.

  3. forumreader says:

    @lhutz34

    I’m with Verizon and actually would like to do the same thing. My contract is up in December, but I’m getting pretty tired of the V and would love to go iPhone. Hopefully this Mexican roaming charge is a good way out, because people had a hell of time with the text/message increase charge option earlier this year.

  4. GearheadGeek says:

    iPhone iPhone iPhone… I wonder how many people are going to try to end their non-AT&T plans JUST so they can get an iPhone, not because of any actual problem with their current service or plan… and how many of those are going to claim that it affects them adversely that VZW/T-Mobile/Sprint don’t have the gotta-have-it phone this summer.

  5. gwong says:

    When it comes to “materially adverse changes,” who determines that? Is it enough for you to say that it is and the company will accept that or will they try to impress upon you what they feel is materially adverse?

  6. not_seth_brundle says:

    A contract is a contract. Just because Cingular says “we can change these terms any time we feel like it” doesn’t mean they actually can. If you sign up with Cingular for 2 years at $40/month and they decide they want to start charging you $70, heck yes you can get out.

  7. Moosehawk says:

    I hate Cingular with a fiery passion.

  8. crnk says:

    @gwong:
    They try to redefine what materially adverse is, but in reality, a single penny is materially adverse. it does, by definition have value, and any change of a single penny would be materially adverse.
    So no matter what they say, it is a materially adverse change, and ANY court will agree with you, if there is a question.

  9. AskForMore says:

    With regards to T-Mobile, does anyone know how they send you the “NOTICE” if you have signed up for online/paperless billing?
    Specifically, the increase in text messaging takes effect on June 1, and I have not received anything in the mail. Will my next online bill have the notice?
    I don’t want to overshoot the 14 day period, in case I decide to cancel.