Verizon Communications Inc. has agreed to pay $64.2 million to settle a class action claiming it improperly billed Family SharePlan participants for overtime minutes and in-network and in-family calls. U.S. District Judge Jose L. Linares, a New Jersey federal judge, is being asked to approve the settlement. Payments pursuant to the settlement include a $36.7 million cash payment from Verizon. Also that will be $27.5 million in “calling units” that will be accessible via personal identification number. The proposed settlement — which was reached after multiple mediation sessions facilitated by retired U.S. District Judge Layn Phillips — calls for the certification of over 2 million settlement class members. Class members can obtain PINs allowing them to make free phone calls in an amount to be determined by a court-appointed claims administrator.
Pursuant to the notice plan, potential settlement class members will be notified by way of Facebook, Internet banner ads and an ad in People Magazine. The litigation goes all the way back to 2006 and involves Verizon’s alleged undisclosed billing practice of charging Family SharePlan customers for overtime minutes resulting from calls made on the primary line at a higher rate applicable to calls made on the secondary line. It also involves the company’s allegedly improper practice of charging customers for in-network or in-family calls it had promised would be free.
It was alleged in the suit that Verizon initiated a nationwide marketing plan in 2001 to promote its Family SharePlan, which advertised a monthly allotment of minutes that could be shared among up to four phones for a single fixed monthly charge. But the suit claimed the company failed to disclose that it would charge overtime minutes at a higher rate associated with the plan’s secondary phones, as opposed to the additional minute rate associated with the primary phones, even if the overtime minutes were made on the primary and not on a secondary phone.
It was alleged that Verizon was aware that its overtime minutes billing practice was inadequately disclosed to and that the customers didn’t understand the practice. Family SharePlan customers. A deadline of Feb. 27, 2015, was requested for objections to be filed to the proposed settlement. A final approval hearing was requested to be held on March 20, 2015.
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