TracFone Users Urge Judge to OK $40M Class Action Settlement

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Last Wednesday, plaintiffs in the class action lawsuit accusing TracFone Wireless Inc. of falsely advertising “unlimited data use” on their phone plans argued that the proposed $40 million settlement should proceed over the voices of objectors.

Lead plaintiffs accuse TracFone and WalMart of offering allegedly unlimited data plans that were actually subject to a number of limitations not adequately disclosed to consumers, resulting in the suspension of data services.

The TracFone class action lawsuit stemmed from a complaint made by the Federal Trade Commission over TracFone’s alleged “throttling” practice, where the company falsely promised customers “unlimited” data service on $45 prepaid plans, but then drastically reduced or entirely cut off their mobile data after they had exceeded certain fixed limits during a 30-day period.

In January of this year, TracFone agreed to pay $40 million as a part of a settlement agreement to end the class action lawsuit and the Federal Trade Commission announced it had reached a settlement with TracFone that will provide refunds to consumers.

Objections were filed by five Class Members who argued that the settlement was inadequate because it was too much of a burden on Class Members to apply and the payout was too low for Class Members to put in an effort. The objectors said that customers would not likely be willing to put effort into making a claim of as low as $2 to $6.

Last week, representatives for the Class Members filed arguments in response to the objections saying that the $2 to $6 estimates given by the objectors assumed a 100 percent take rate and were therefore low. According to the class representative, actual payouts should be approximately $16 for users who had their service throttled, $25 for those who had their service suspended and $65 for those who were terminated. The class representatives also pointed out that if the case went to litigation, there is a chance TracFone would win and then not have to pay nothing to the Class Members.

“These scant numbers, particularly in light of the remarkable number of claims, demonstrates both that the overwhelming majority of the class approves of the settlement and that the settlement is fair, reasonable and adequate,” the plaintiffs argued in response to the objections.

The deadline to file a claim for the TracFone class action settlement is June 19, 2015.

The Class Members are represented by Michael W. Sobol and Nicole D. Reynolds of Lieff Cabraser Heimann & Bernstein LLP, Daniel M. Hattis of Hattis Law and Cornelius P. Dukelow of Abington Cole.

The TracFone Unlimited Data Class Action Lawsuit is Hansel, et al. v. TracFone Wireless Inc., et al., Case No. 13-cv-03440, in the U.S. District Court for the Northern District of California.

UPDATE: The TracFone class action settlement received final approval on July 2, 2015.

UPDATE 2: According to the settlement administrator, the Tracfone class action settlement will become effective on Aug. 1, 2015 and checks will be mailed by Oct. 20, 2015.

UPDATE 3: Settlement checks were mailed out to Class Members starting on Mar. 22, 2016 through Mar. 29, 2016. According to the settlement administrator, Class Members must cash their refund checks no later than July 20, 2016.

UPDATE 4: On Mar. 26, 2016, Top Class Actions readers have started receiving settlement checks! If you filed a claim for the TracFone “unlimited” data class action settlement, keep an eye on your mailbox because checks are on the way!