June 04, 2008

By By Antony Bruno, Denver

Following a similar settlement earlier this year in Florida, AT&T Mobility has settled a class action lawsuit in Georgia targeting the company's involvement with placing unauthorized content charges on subscribers phone bills.

The complaint stems from the marketing practices of third party or "off-deck" content providers -- companies that sell content like ringtones, games and graphics outside of the operator's on-phone menu, but who charge for the service via a billing relationship with the operator. Many customers are duped into paying $10 or more in monthly content subscription charges when signing up for what they thought was a free ringtone.

According to the suit, AT&T did not provide customers with sufficient protection against such unauthorized charges. The company agreed to pay $4.3 million in legal costs, plus an undisclosed amount to cover refunds.

It is the first such nationwide settlement for such complaints. Other wireless operators like Sprint, T-Mobile and Verizon Wireless are all facing similar suits.

In March, AT&T settled with the Florida Attorney General's office over a similar complaint, paying a $2.5 million fine, up to $45 million in customer refunds, and dedicated $500,000 to a customer education campaign.

Mobile operators are not the only entities targeted by the third-party content backlash. In April, Google found itself the target of a similar lawsuit, complaining that the company won't ban advertising from fraudulent mobile content providers. Lawyers for the plaintiff are seeking class actions status.

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