Librarian Takes Sprint Nextel & Wells-Fargo To Small Claims Court And Wins

Last December, Theodore Karantsalis received a letter from Sprint, where he was a customer, telling him that someone who banks with Wells-Fargo—where he’s not a customer—was presented with his invoice and personal data when they logged into their Wells-Fargo Checkfree account. The customer contacted Sprint, and Sprint contacted Karantsalis. Karantsalis decided that he’d deal with the issue on his own instead of bringing a lawyer into it or throwing his hands up in frustration, so he took both companies to small claims court.

Neither company bothered to send a lawyer to the hearing—although the day before the hearing, they contacted him with a settlement offer if he agreed not to discuss the case with the media—and last week Karantsalis won damages plus court fees for a total of $756.80.

Okay, so that’s clearly not enough money to hurt either company—Sprint easily spends 50 times that every day giving lobotomies and tongue-bobs to Customer Service new hires—but we’re impressed with Karantsalis’ DIY approach to legal justice. As Evan Schuman notes in a related article, there are lots of ways you can define “winning” in a situation like this, but few of them can beat the odds of wrapping up a small claims case quickly and in your favor:

Is the objective to make the consumer whole, in the sense of getting them to the point financially where they would have been the data privacy booboo never happened?

Is it to make it much more likely that the wrong will never be repeated, sparing other consumers of the headache? Is it to make money for the consumer? Is it, dare I say, to make moneys for the law firms?

The recent TJX lawsuits, for example, could be said to have failed for their consumer plaintiffs on all of those objectives, other than making money for the law firms and even that money was rather paltry.

Schumann wistfully describes a mass consumer uprising, where everyone foregoes class-action lawsuits and uses small claims court instead to seek reasonable damages—for instance, Karantsalis came up with his figure by tripling the cost of a year of data encryption services.

With this settlement publicized, will tens of thousands consumers now take these frequent breach notification letters and drive to their local small claims court? The onerous nature of a retailer having to defend against literally tens of thousands of virtually identical accusations was precisely the kind of situation that class-action lawsuits were supposed to eliminate. But the civil demands for financial losses create a crack for these cases to slip into.

Theodore Karantsalis as a Small Claims Court Johnny Appleseed! Small Claims FTW! Oh, wait… we signed all those damned arbitration agreements.

(Thanks to econobiker!)

“The Librarian Wins In The Data Breach David Vs. Goliath Battle” [StorefrontBacktalk]

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(Photo: Getty)

Comments

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  1. humphrmi says:

    The article isn’t fully clear, but I think he has won a default judgment. Which is usually good enough, except that most companies usually appeal default judgments (I know, I’ve been through it). It’s not that he’ll lose, but he might have to spend more time in court. Worst case, they throw out the judgment and make him go to trial again. Actually, that’s not the worst case. The worst case is, they get a biz-friendly judge to throw out the default judgment, then they demand a jury trial, and before he goes back into court he has to learn how to write jury instructions.

    But hey, if it holds, good for him! :)

  2. Laffy Daffy says:

    Not really sure what is going on here; it’s really confusing and poorly written. In Illinois at least small claims is limited to actual damages only, so this tactic won’t work everywhere.

  3. jeffjohnvol says:

    It looks to me like it was an honest mistake by Sprint and not only did they correct it, but they sent the letter to inform the customer.

    I think the customer was a little overly litigious IMO.

  4. balthisar says:

    The summary and the FA are both kind of disjointed. What was the loss here? Why triple the price of the PGP package? PGP won’t help this guy. Was damage done? Heck, the guy that could have stolen the “personal information” let Wells-Fargo know there was a problem.

    A librarian that also works for Customs and Immigration sounds like some underemployed dude that’s just hunting for money.

  5. deweydecimated says:

    A librarian who worked for, not also works for….

    And all guybrarians are as hott as the pic. Really.

  6. hey that’s the most inspiring story i’ve heard all week. Companies need to be held accountable. There’s nothing wrong with using the courts that we the people pay for with our own tax money.

  7. Adam Hyland says:

    @deweydecimated: Liberador. Not guybrarian.

    And…I’m REALLY confusd as to what they story is. Someone got his invoice and their bank sent it to sprint and sprint did the right thing by telling him about it?

    I can guess that the problem might be the error that both companies made in allowing his personal information to get to another customer. That’s understandable, but it took a few reads. The summary should really be clearer.

    All in all….ummmmm…ok. People go to small claims all the time. This site has posted plenty of how-to’s on it, but that doesn’t mean that it is a good idea for people to forsake class action lawsuits for small claims actions.

    Class actions are great vehicles to lower transaction costs for large numbers of plaintiffs. If we all faced <10 dollars worth of harm (or say <25, which is ~ the filing or serving fee for a class action suit ), why would we file suit? We wouldn’t. But if a company fucked thousands of people over to the tune of 24.99, they could make lots of money. The solution to that? Class action law suits. My transaction cost is low, I just need to send some forms or something, but the suit gets filed and people get protected.

  8. Chris Walters says:

    One more time, though if you’re confused you may just want to skip this whole post: Karantsalis is a Sprint customer. He’s not a Wells-Fargo customer. Some stranger–we’ll call him X–who IS a Wells-Fargo customer logged into X’s own Checkfree account on the Wells-Fargo site to pay his own Sprint bill. Sprint somehow served X Karantsalis’ Sprint invoice via the Wells-Fargo site. Do you see why it’s confusing? Because it makes no sense! Sprint had a glitch of some sort and gave out Karantsalis’ personal information on a totally unrelated (to Karantsalis) bank website to a total stranger–and Sprint wouldn’t have caught it if X hadn’t told them. It doesn’t matter whether or not any “harm” was done — Sprint had a data breach and opened Karantsalis up to possible risk of ID theft and loss of privacy.

    Just read the links if you’re still confused. There’s even a PDF of the original Sprint letter in the second “related” article. Some summaries defy skimming or easy A-B-C narratives.

    *grumble* poorly written my ass *grumble*

    The problem with class actions, as we note here frequently, is they often do little to penalize the company and sometimes do almost nothing to compensate the participants. Too often–Netflix and TJX come to mind–the final settlement is offensive in the degree to which is screws over the consumer while netting the lawyers a tidy sum and only slapping the hands of the offending corporation.

  9. brennie says:

    @humphrmi: I’ve only done small claims once, but the fact that the other party didn’t show resulted in one bang of the gavel and a check for me from the third party rep they sent. No default judgement. No appeal. Sounds like this guy had the same experience.

  10. doctor_cos wants you to remain calm says:

    @Chris Walters: Thanks for clearing that up.
    And +100 on the class action comments. These do nothing for the members of the class but must certainly be rewarding for the legal team.

  11. Black Bellamy says:

    @brennie: you describe a default judgement then say no default judgement

  12. humphrmi says:

    @brennie: A default judgement is when the defendant doesn’t show. They are easy to appeal in some jurisdictions.

  13. chocoruacal says:

    Good luck collecting! Winning in small claims court is often no great challenge. Collecting from a company this size is going to prove nearly impossible.

  14. failurate says:

    What damages did he say he incurred? Are we able to sue for potential damage?
    I could see him being awarded a lifetime subscription to a credit monitoring service of some sort.

    How important is it to shred cell phone bills?

  15. northernplateguy says:

    Maybe this guy can get a job with the legal department at weddingdepot.com. [consumerist.com]

  16. Amy Alkon says:

    I think the customer was a little overly litigious IMO.

    Companies need to be held accountable — and the only way they can be is in the only way it hurts: financially. I think the customer was fanastic.

  17. shadow735 says:

    Who cares if people dont know by now that Sprint sucks major Ass then its their fault that they are still a customer.

  18. Jean-Baptiste Emanuel Zorg says:

    @humphrmi:

    A default judgement is when the defendant doesn’t show. They are easy to appeal in some jurisdictions.

    That’s a key point. When it comes to many (if not most) consumer issues, the rules vary wildly from state to state. I don’t know about Florida, but in New Jersey, Small Claims verdicts can only be appealed on the basis of disputes of law, not fact. Given proper service I suspect that a no-show is not enough for an appeal here. Then again, IANAL.

  19. apotheosis says:

    The writing might not have been spectacular overall, but “Sprint easily spends 50 times that every day giving lobotomies and tongue-bobs to Customer Service new hires” was worth a chuckle. So, there’s that.

  20. dlow_g says:

    This guy is not your typical librarian. Has anyone read the article in the Washington Post about him suing the government to locate his friend’s body overseas? [www.washingtonpost.com]

  21. delphi_ote says:

    WTF is this encryption service damages BS? What good does it do to encrypt data that was already leaked? In what way is a subscription to an encryption service compensation for the identity theft risk he was exposed to and the violation of his privacy?

    This is stupid in so many ways I don’t even know where to start. This is “hero consumer” clearly has no idea WTF he’s talking about.

  22. tommcaulliffe says:

    The end result is the key here. The guy won. And I’ne never read a story like this where the little guy wins against two big companies by using his brains. Delphi, why don’t you continue on with class-actions and wait a few years for your $5.00 coupon. I’m betting with the librarian and will roll my dice in small claims court. THE BEST ARTICLE I’VE READ IN A LONG TIME!

  23. ms_sassy_pants says:

    He’s cute!!! [www.flickr.com]