February 3, 2017

consumer-fraudThe Office of the Attorney General for the State of New York (“NYAG”) has filed a consumer fraud complaint against Charter Communications, Inc. and Spectrum Management Holding Company, LLC (“Spectrum”) for deceptive practices in connection with its wireless Internet services.  The suit seeks, among other relief, disgorgement, restitution on behalf of consumers, payment of civil fines and an injunction prevent Spectrum from engaging in future wireless Internet practices deemed to violate consumer protection laws.

What is the nature of the NY AG’s claims against Spectrum?

The NY AG alleges that Spectrum, the successor entity to Time Warner Cable, systematically made knowingly false claims to consumers concerning the quality of its wireless Internet services.  Specifically, the NY AG alleges that Spectrum marketed wireless Internet services to consumers in different tiered packages, priced in increasing monthly variants depending on the offered downloaded megabyte per second speed.  Spectrum marketed wireless Internet packages to the public by touting its network’s reliability and fast speeds.  However, the NY AG alleges that this was deceptive insofar as Spectrum allegedly knew that the technology supporting its wireless Internet services, including the modems and routers leased to consumers, and the user-related congestion Spectrum allowed on its networks, was of such insufficient quality that consumers would never realize the Internet speeds for which they were promised.  The NY AG alleges that the resulting poor Internet speeds and Spectrum’s overcharging for services that it was not delivering as a result of these practices injured millions of consumers over the course of up to four years.

Protect Against A Consumer Fraud Lawsuit

As we have previously blogged, state attorneys general and federal authorities have been active in investigating and prosecuting companies for consumer fraud violations, specifically in connection with deceptive advertising and marketing practices.   The NYAG’s lawsuit against Spectrum is a reminder that advertisers face a wide range of legal risks in today’s regulatory climate.  Therefore, before undertaking a marketing campaign, it is imperative to engage knowledgeable counsel to ensure that your marketing practices and procedures are fully compliant with all applicable laws, rules and regulations.

If you are interested in learning more about this topic, need to review your marketing practices and procedures or if you are facing an investigation from a state attorney general or other regulatory agency, please e-mail us at info@kleinmoynihan.com, or call us at (212) 246-0900.

The material contained herein is provided for information purposes only and is not legal advice, nor is it a substitute for obtaining legal advice from an attorney.  Each situation is unique, and you should not act or rely on any information contained herein without seeking the advice of an experienced attorney.

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