August 1, 2008

The ruling, by a California state judge, is a major win for class action lawyers who've been seeking to extract large sums from cellphone companies over the long prevalent practice of charging fees to consumers who leave contracts early. Sprint had prevailed in an earlier round of the case decided before a jury, but the judge's ruling invoked a different theory of liability. Declan McCullagh at CNet finds the lawsuit's logic "muddled": "Someone has to pay for the cost of the handset. The customer either pays upfront or, if it's subsidized by the carrier, over time in the form of an early termination fee that--in Sprint's case--was $200."