Four customers of Frontier Communications have filed a class action lawsuit against the broadband and digital voice provider over a US$1 to $1.50 mystery charge on their monthly bills.
Frontier customers Clint Rasschaert, Ed Risch, Pam Schiller and Verna Schuna allege that Frontier is illegally taxing them for broadband service, even though state and federal laws prohibit most broadband taxes. The so-called HSI surcharge is not authorized by government agencies, even though Frontier tells customers that all surcharges are required or authorized by the government, said the lawsuit, filed Tuesday in U.S. District Court for the District of Minnesota.
The surcharge "is merely a junk fee that Frontier imposes on customers," Michelle Drake, the lawyer for the plaintiffs, wrote in the complaint. "The fee bears no relationship to any governmentally-imposed fee or regulation, and is nothing other than an effort by Frontier to increase prices above advertised prices under the false and misleading guise of governmental authority."
The surcharge is listed under state taxes and other charges on customers' bills. "Any reasonable customer would believe its a state fee," Drake said.
Drake, from the Nichols Kaster law firm in Minneapolis, said customers shouldn't have to check the sales tax calculations on their bills or know what government charges are acceptable on broadband bills. "This case is the result of a toxic combination of corporate greed and laziness," she said. "We shouldn't need to sue just to get big corporations to truthfully bill their customers."
Some Frontier customers posting comments at DSLreports.com and Stopthecap.com have complained that the HSI surcharge is $1.50 a month on some bills. Frontier has alternatively explained the charge as a federal government charge, a charge for high-speed Internet service and a charge for customers out of contract, according to posters at those sites.
The fee is not included in the advertised price for Frontier broadband service, Drake said. The plaintiffs would be less upset if Frontier simply included the charge in its advertised price, she said.
"They can charge whatever price they want," she said.
Frontier, in a statement, said it wouldn't comment on the allegations in the lawsuit. "We take all litigation claims and customer complaints seriously and will carefully evaluate and respond to the lawsuit at the appropriate time," the company said. "Frontier values its customers and we believe our charges and practices are consistent with applicable state and federal law."
Frontier, based in Stamford, Connecticut, offers broadband, digital voice, and satellite television service. The company has about 3.3 million residential customers, 333,000 business customers, and 1.7 million broadband customers across 27 states, according to its first quarter financial report.
Grant Gross covers technology and telecom policy in the U.S. government for The IDG News Service. Follow Grant on Twitter at GrantGross. Grant's e-mail address is firstname.lastname@example.org.