AT&T's New 2,500 Page Contract 'Directly Violates' The Law

Do you want to know if AT&T boosts your rates? Maybe you want to pay only for services you ordered or explicitly authorized. Tough! AT&T’s new 2,500 page “guidebook” is the latest spawn of California’s failing experiment with deregulation, one that is in “direct violation” of the law, according to the Public Utilities Commission.

Witteman said a key problem with AT&T’s service agreement is that the company doesn’t list all the terms and conditions that apply to customers. Rather, AT&T says customers must review a separate “guidebook.”

That guidebook is available only online, Witteman said, and runs about 2,500 pages. “What consumer is going to slog through that?” he asked.

Moreover, the service agreement says AT&T will “generally” provide written notice of price increases at least 30 days in advance, except when such notice isn’t “commercially reasonable.”

Witteman said the online guidebook and ambiguous notification policy appear to violate a California statute requiring that consumers “be given sufficient information to make informed choices.”

AT&T’s service agreement is written in dense legalese and essentially gives the company as much latitude as possible — while limiting customers’ ability to seek redress.

[..]

An analysis of the agreement prepared for PUC staffers found fault with a variety of AT&T’s provisions, including this one: “You also agree to pay for all charges for services provided under this agreement even if such calls were not authorized by you.”

The analysis said this “is in direct violation to cramming laws,” which protect consumers from having unauthorized charges placed on their bills.

Under the provision, the analysis concluded, “AT&T, or any other billing agents, could impose unauthorized phone calls on a consumer’s bill.” It said consumers would have “little chance in both avoiding and fighting against this type of fraud.”

Unlike mandatory binding arbitration agreements—which are included in the guidebook—you can’t simply opt-out of these new terms. “If you do not agree with the provisions of this agreement, your sole option is to cancel your services . . . within 30 days after receipt of this agreement.”

Go free market, go!

AT&T buries customer rights in 2,500-page ‘guidebook’ [The Los Angeles Times]
(Photo: jetsetpress)

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  1. JustThatGuy3 says:

    “You also agree to pay for all charges for services provided under this agreement even if such calls were not authorized by you.”

    As I read it, this provision is designed to deal with the “I didn’t make 300 minutes of calls from my home phone to Zimbabwe, it was my maid – I’m not paying for them!” Without the context, it’s hard to know if it was poorly drafted, appropriate, or genuinely overbroad.

    • Sudonum says:

      @JustThatGuy3:
      And in the next paragraph:
      “The analysis said this “is in direct violation to cramming laws,” which protect consumers from having unauthorized charges placed on their bills.”

      I guess the “context” would be whatever AT&T’s interpretation is, since they wrote it.

      The bottom line is that they de-regulated the industry to foster competition and now the industry is pissing on the consumers leg and telling them it’s raining. In your example, if AT&T can prove that the calls were made from the subscribers phone, and that the phone was in possession of an authorized user, then, yes, they are responsible. If a customer left their wireless phone lying around where a family member or employee could pick it up and use it, then I would say that those were “authorized” calls. However that is not how I read this clause.

  2. TheUncleBob says:

    California’s de-regulation? Isn’t California one of the most regulated business markets in the US?

  3. deadspork says:

    So, if we want to opt out, we cancel our service with them? Can we do that without a contract-termination fee?

    • @deadspork: I’d like an answer to that as well.

      Surprisingly, I’ve never had a problem with AT&T. However, this is something that would surely push me over the edge and seriously make me think about cancelling. So, all mighty Consumerist, please let us know if this new contract will enable us current subscribers to get the hell out of AT&T’s grip.

  4. SabreDC says:

    So, in short, you have 30 days to read 2,500 pages and if you don’t, you agree to abide by it? What a load of BS.

  5. FLConsumer says:

    Too bad they aren’t willing to provide compensation for your legal counsel to review it.

  6. tz says:

    You do no better when you label crony-capitalism or corporatism “free market”. I know it was the lie it was sold on, but repeating it slanders the wrong party. You want every aspect of YOUR life to be controlled? You hate freedom?

    If it were a free market, I could just go in there, write a no-nonsense service agreement which would be fair to all, and start my own phone company. Oh, but they won’t use eminent domain for me to put up towers? Besides, the Government owns the spectrum and has granted it only to those who out bribe, I mean outbid the competition?

    It is free enough to go with other services. If AT&T wishes to be evil, and there are alternatives, go with them.

    Instead of taking your business elsewhere – where they might appreciate it – you prefer to have the corporate fat cats and political fat cats come up with a 250,000 page document regulating what they can and cannot do with a PUC that has a phone tree worse than anything you’ve seen so far.

    Before you blame the free market, just see if you could start a competitive business. If you can’t, the market is not free.

    • PurplePuppy says:

      @tz: I agree. We haven’t had 100% “free” markets since around the civil war. We frogs have been boiled alive and now we don’t even notice that it’s not free. Virtually anything that isn’t as bad as the USSR is considered “free market”. What we really have is the worst of both worlds: socialism for corporations and the uber-rich, and survival-of-the-fittest for the poor, middle-class, and even moderately wealthy. I’m beginning to think that we’re going to have to go pure socialist for about 50 years or so in order to re-discover free markets in a pure form, without the class-war BS we have now.

    • ELC says:

      @tz: Excellent and right on point. There are too many markets that aren’t really free – there are oligopolies or actual monopolies (airline, phone, cable, utilities, etc).

  7. Judge_Smails says:

    Wow, check out page 1383:

    “Customer agrees that AT&T has the right to sell the customers body for medical experiments.”

  8. whitefang2000 says:

    breaking the law is breaking the law. The problem is not deregulation if the laws are being broken.

  9. reiyaku says:

    what the piss?!? seriously, it wasn’t this bad BEFORE the governator took over… local state govt (aka CA pre governator era) were on these things like ants and dismantels/correct these type of issues… now its pretty much were eating corporates crap! even state finances are screwed! and students are left to burn… come on californians… when are you guys going to take a hint that something needs to be done and not by being silent and passive about these things?

  10. Trai_Dep says:

    Verizon does the same thing: your agreement refers to an online TOS page, which is both voluminous and fluid. Then when you discuss the clear-cut terms in your agreement (extending a contract under the same terms, as the agreement explicitly says is allowed), Verizon’s CS reps tell you to refer to their online TOS site. That is, anything your agreement contract says can be changed on their side whimsically by citing their TOS; any commitment on yours is ironclad.
    If it’s not illegal, it should be.
    I (cough) submitted this as a possible Consumerist story but I guess it was too legalistic for them to cover, but it looks like it’s a widespread practice that all the telecoms do in one form or another.
    I hope the PUC looks into Verizon’s flavor of this scam as well – it seems one-sided and unfair.

  11. chris_d says:

    at&t thinks it can violate the law and get away with it???? Where could it POSSIBLY have gotten that idea?

    • dweebster says:

      @chris_d: I dunno, but the beautiful pamphlet they sent out a month or so ago says they can violate the law, spy on customers, violate privacy, and do a whole lot of other things to us that the worst KGB agent would never have dreamed of. Talk about ballsy, that bribery that they gave the Dems and Republicans sure paid off in spades if they can be so blatent in an election year with their evil shit.

  12. dumblonde says:

    Meh. If the contract is “in direct violation” of law then the first time it goes to court it will be declared null and void. The first rule of contract law is that any contract that goes against the law is null. Of course that’s why they try to intimidate you into not taking them to court. assholes.

    • johnnya2 says:

      @dumblonde: There are usually clauses in contracts that say if any section is considered null, it only pertains to that section, NOT the entire contract.

      • Kicken says:

        @johnnya2:
        If the entire contract is rendered null, that includes the section stating only that section is rendered null.

        Remember, no policy or contract can trump the law. (Thus why you find policies and contracts having to be enforced by taking the issues to court.)

    • silver-bolt says:

      @dumblonde: And mandatory arbitration prevents it from going to court, on top of what johnnya2 said

    • dweebster says:

      @dumblonde: Oh, but you’ll be talking to their paid “arbitrator” according to their new terms. AT&T is outside the law and a law unto themselves (again).

  13. HalOfBorg says:

    2,500 pages??!?!!! What are theses guys, Ferengi??

  14. HalOfBorg says:

    ‘theses’…….so wish there was an edit button…..not complaining though.

  15. fisherstudios says:

    The worst are companies that put in “and you agree that we may update the contract at any time”.

    You might as well just sign a blank piece of paper.

    • dweebster says:

      @fisherstudios: Yeah, we just send them a blank signed check nowadays, just in the event they decide that they have increased their rates since mailing us that last bill. Whatever they write on the check will probably be easier to stomach than the days searching their website(s) for term changes on a 1-sided “contract.”

  16. Difdi says:

    So download the 2500 page document, edit it and burn it to CD, all with multiple witnesses (one of whom being a notary public). Then mail a copy of the CD, registered and certified to the legal department of AT&T with a cover letter noting that a contract is between two parties, and here is the amended contract between you and AT&T.

    Basically, edit out or alter all the clauses you disagree with. Include a clause noting that if your service is not terminated by AT&T, that signifies that they accept the contract.

    Do the above as an alternative to canceling your AT&T service. The worst that can happen is they cancel your service, which you would have done anyway. It may even be less work than talking them into really canceling your service, and also evades any possible ETF, since it would be AT&T canceling, not you.

    If your service continues, you can refer to the new contract with AT&T, which probably doesn’t include all those weasel clauses AT&T CSRs hold over your head like the sword of Damocles. If they claim it’s not a valid contract, sue them under a clause you added to the contract allowing you to do so.

    Might be fun to try, for someone who can afford a lawsuit…

    • dweebster says:

      @Difdi: I’d do that in a heartbeat – sounds like a good project for some aspiring lawyers – polish up the contract and post it for download. Those of us who plan to cancel with the scumwads anyway can instead send them a contract for THEM to refuse. Add in some penalties that a local small claims court can award for AT&T’s failure to perform – that’ll keep their crack legal team busy so they can’t keep pulling this sort of shit.

  17. dragonfire81 says:

    Maybe someone here can shed some light on this:

    Cell phone providers reserve the right to change their terms so long as you get proper notice.

    So then we were always that the original piece of paper the customer signed is not necessarily the terms they are currently agreeing to. If a service change has been made and the customer had not contested it, the customer had in effect agreed to a modified version of the original contract.

    Nonetheless I had customers demanding we send them a copy of the original signed contract (which we had no way to do) because they felt we had roped them into something they “hadn’t agreed to”.

    Were the customers right that the original terms were what was legally agreed upon or does the “we reserve the right to change these terms…” provision mean the current version of the agreement is the legally binding one?

    • cerbie says:

      @dragonfire81: if they signed an original contract, and you can’t send them a copy, how is any form of it legally binding, beyond agreeing to the charges on a month-to-month basis? Haven’t there been more than a few cases of Consumerist readers getting out free based on that?

  18. dragonfire81 says:

    And by “service change” I mean for example, an increase in the casual usage texting rate. Or a new surcharge.

  19. loslosbaby says:

    Awesome. “Competition” in the U.S. means “Two companies”.

    I got crammed with 50$ worth of “M Boost” charges that they won’t describe to me. They tell me to call an 800 number to “cancel”. The phone they insist “downloaded content” is an iphone, that doesn’t do custom ringtones or backgrounds via that mechanism…and, can’t “download” that “content” since they don’t support media-SMS.

    OK Atty General, here we go!

  20. vastrightwing says:

    Everyone is calling this an “agreement” but it’s not: you aren’t agreeing to the terms because you don’t know what they are! An agreement is where 2 parties consent and agree to terms. The fact the “agreement” is long and confusing, in my mind, makes the “agreement” not an agreement, but merely a tool for AT&T to take advantage of the legal system. The reason AT&T gets away with this is because they only enforce the their terms when it suits them. They won’t offend the customers who pay them lots of money.

  21. ARVash says:

    What I want to know is, what happens when a few million people decide to download and read this likely PDF document.. at the same time.

    Just sayin’.

  22. ARVash says:

    In all seriousness though, people need to know what AT&T expects people to follow; here are the documents in easily accessible manner. You can click “Open Bunch” to read the documents and cross reference.

    [linkbun.ch]

  23. ARVash says:

    In their defense at least it’s broken into “byte” size chunks. I suspect to reduce server load though, rather than ease of reading.

    Well AT&T I do have your service and I might just read it. ALL OF IT.

  24. Onouris says:

    If that were here in the UK, it sounds like something the government would slap AT&T around the head with the aptly named “1999 Unfair Terms in Consumer Contracts Regulations” for.

    Also, 2500 pages? What? Are they listing every possibility and every outcome of every situation someone could ever face with a mobile phone?