AT&T Consumer Opposes Arbitration Bid in GoPhone Class Action

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An AT&T customer is opposing the prepaid cell phone provider’s motion to compel arbitration, stating that because he never activated his GoPhone, he never agreed to arbitrate his claim.

Plaintiff Eric Zatt asked a California federal judge last Friday to reject AT&T’s request to arbitrate a proposed class action lawsuit that accuses the company of a “classic bait and switch” by offering a 10-cent per minute plan for all domestic cellphone calls, even though it has no such plan.

Zatt sued AT&T in June 2016 after purchasing an AT&T GoPhone in a package labeled “Your plan — your choice,” offering a 10-cent per minute plan for any call within the United States.

“Under the heading ‘Your plan – your choice,’ the packaging, for the cellular phone purchased by plaintiff Zatt features a $0.10 per minute plan for calls within the United States,” the AT&T prepaid GoPhone class action lawsuit states. “Despite this representation … AT&T offers no such plan, instead only allowing GoPhone purchasers to choose other, substantially more expensive calling plans. This tactic or practice constitutes a classic ‘bait and switch.'”

However, in response to AT&T’s motion to compel arbitration, Zatt contends that while attempting to activate the GoPhone, he discovered that AT&T was actually charging usage rates exceeding $0.10 per minute.

Because of this alleged misrepresentation, Zatt chose not to activate his GoPhone.

“Once plaintiff recognized that AT&T had misled him with respect to the rates for usage of the GoPhone, he declined to activate the phone, and per force, did not accept AT&T’s proposed binding arbitration terms with respect to the GoPhone,” the motion said. “Defendants cannot dispute this.”

According to the motion, once AT&T recognized Zatt never agreed to arbitrate claims relating to his 2016 GoPhone purchase, AT&T focused their argument on Zatt’s “unrelated” 2009 purchase of an LG CE110 cell phone and associated service through AT&T wireless.

Zatt purports that AT&T attempted to apply an arbitration clause from this since terminated account to this case.

“Plaintiff did not agree to or accept some open-ended, omnipresent, immortal binding arbitration agreement that would forever and always bind him to any dispute that may one day develop between he and AT&T, even with respect to tortious conduct that has absolutely nothing to do with the 2009 AT&T purchase and service plan or billing respecting that ‘above number,’” Zatt said.

Moreover, Zatt states that no where does the GoPhone Plan Terms recite that anyone who previously purchased a different phone and/or previously agreed to AT&T’s wireless service agreement for a non-GoPhone need not accept and agree to separate and independent GoPhone Plan terms.

“Of course, that would be silly since the GoPhone is a unique and different device and service,” the motion said. “Indeed, AT&T knew this — that is why it requires GoPhone users to accept the stand-alone GoPhone terms, irrespective of any prior wireless service agreement.”

Zatt seeks certification of a nationwide Class and California subclass, and damages for fraud, negligent misrepresentation, unjust enrichment, false advertising, and unfair competition.

The plaintiff is represented by Stephen R. Basser and Samuel M. Ward of Barrack Rodos & Bacine.

The AT&T Prepaid GoPhone Bait and Switch Class Action Lawsuit is Eric Zatt, et al. v. AT&T Corp., et al., Case No. 3:16-cv-01323, in the U.S. District Court for the Southern District of California.