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Cellphone Termination Fee Cases: Difference between revisions
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The customers demanded a new trial. | The customers demanded a new trial. | ||
|issues=Can the presumption against a liquidated-damages provision in a consumer contract be overcome without evidence that the proponent conducted an analysis attempting to match the damages to its actual losses? | |issues=Can the presumption against a liquidated-damages provision in a consumer contract be overcome without evidence that the proponent conducted an analysis attempting to match the damages to its actual losses? | ||
|arguments=Sprint argued that it made a reasonable endeavor to calculate is ETFs. | |||
|holding=No. The presumption against liquidated-damages provisions in a consumer contracts can't be overcome unless the proponent shows it conducted an analysis attempting to match the damages to its actual losses. | |holding=No. The presumption against liquidated-damages provisions in a consumer contracts can't be overcome unless the proponent shows it conducted an analysis attempting to match the damages to its actual losses. | ||
|rule=Judge Bruiniers: A liquid-damages (penalty) clause in a '''consumer contract''' is presumed void under California law. | |rule=Judge Bruiniers: A liquid-damages (penalty) clause in a '''consumer contract''' is presumed void under California law. | ||
Revision as of 13:02, August 30, 2023
| Cellphone Termination Fee Cases | |
| Court | California Court of Appeal for the First District |
|---|---|
| Citation | 193 Cal.App.4th 298 |
| Date decided | March 3, 2011 |
Facts
Sprint Corporation charged early termination fees (ETFs) for its cell phone clients.
Sprint offered cell phone contracts lasting 1 or 2 years. ETFs could be $200.Procedural History
Sprint customers filed a class-action lawsuit.
The jury found that Sprint had collected over $73 million dollars in ETFs from the class members. These early terminations had in turn cost Sprint $225 million in damages.
The trial judge found the ETFs Liquidated Damages (a penalty).
The trial court enjoined (prohibited) Sprint from collecting additional early termination fees (ETFs); Sprint was ordered to cough back $73 million in restitution. At the same time, the $225 million damages were to be offset in Sprint's favor. To sum it, the court announced that neither party would be allowed to recover anything.
The customers demanded a new trial.
