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Material adverse change to contract - Invalid Early Termination Fee
Posted Fri February 24, 2012 8:15 am, by Mark C. written to Sprint Wireless
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I am writing to express my abominable experience attempting to remove the invalid $80 early termination fee (ETF) on my Sprint October 2011 monthly statement for terminating one of four lines on a family share plan on September 10, 2011. I terminated said line because I did not agree with the Administrative Charge increase and Terms & Conditions (T&C) changes effective September 9, 2011, namely, "Administrative Charge Increase & Terms & Conditions Changes for Consumers Effective 9/9/11, the Administrative Charge will increase to $1.50 per line for customers that receive the charge." I followed the terms of the contract and I terminated this particular line within 30 days after the effective date of the changes. Adverse material changes were made to my contract, which permitted me to terminate said line without an ETF according to the T&C of the two-year contract that I signed on May 27, 2010.
The T&C state, "When You Don't Have To Pay An Early Termination Fee
You aren't responsible for paying an Early Termination Fee when terminating Services: (a) provided on a month-to-month basis; (b) consistent with our published trial period return policy; or (c) in response to a materially adverse change we make to the Agreement as described directly below.
Our Right To Change The Agreement & Your Related Rights
We may change any part of the Agreement at any time, including, but not limited to, rates, charges, how we calculate charges, or your terms of Service. We will provide you notice of material changes, and may provide you notice of non-material changes, in a manner consistent with this Agreement (see "Providing Notice To Each Other Under The Agreement" section). If a change we make to the Agreement is material and has a material adverse effect on Services under your Term Commitment, you may terminate each line of Service materially affected without incurring an Early Termination Fee only if you: (a) call us within 30 days after the effective date of the change; and (b) specifically advise us that you wish to cancel Services because of a material change to the Agreement that we have made. If you do not cancel Service within 30 days of the change, an Early Termination Fee will apply if you terminate Services before the end of any applicable Term Commitment."
I have since written to CEO Dan Hesse (no response), Sprint Executive and Regulatory Services, filed formal complaints with BBB and FCC and still there has been no satisfactory resolution despite numerous entreaties.
I would like Sprint to abide by the T&C of the contract and credit the $80 early termination fee and the current associated late fees ($7.50).
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Didn't the fee go from .99 to $1.50 -- so you are actually talking about .51 cents? Right?
Which just over $6.00 a YEAR?!
Your claiming "materially adverse change" on $6 and change a year if I understand this correctly.
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by PepperElf Posted Sat February 25, 2012 @ 7:22 AM
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The problem you're facing is that you may have to actually PROVE 1.50 is actually causing an "Adverse material change" to your budget.
Simply saying, "Adverse material charge!!!" because you don't want to pay the fee does not actually mean it's going to be approved.
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by Mark C. Posted Fri February 24, 2012 @ 9:15 PM
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Effective September 9th, Sprint changed the T&C of the contract by increasing the Administration Fee from .99 to $1.50. They also changed the arbitration clause in the contract to mandate that the company JAMS be used. Both of these are materially adverse changes to the contract with them.
In Cunningham vs. Fleetwood Homes of Georgia, page 611 of the third Federal Reporter, volume 253, the Eleventh Circuit Court of Appeals ruled that arbitration clauses are material terms to a contract.
In addition, Sprint's additional changes in policies are:
1) $0 upgrade fee online raised to $36 for new phone upgrades ($36 for each line)
2) Sprint Premiere ends
3) Return policy goes from 30 days to 14 days
4) Raising admin fees and changing arbitration clause (material adverse that affected me)
5) ETF goes from $200 to $350
6) Charging $1.99/mo for detailed monthly statements
Since September, Sprint has silently added new language to the Terms and Conditions. They now specifically mention an administrative fee range:
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**Monthly charges exclude taxes, Sprint Surcharges [incl. USF charge of up to 14.4% (varies quarterly), Administrative Charge (up to $1.99/line/mo.), Regulatory Charge ($0.40/line/mo.) & state/local fees by area (approx. 5-20%)]. Sprint Surcharges are not taxes or gov't-required charges and are subject to change. Details: Sprint.com/taxesandfees.
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This new language has been added only in the last couple of days, without any notice to customers whatsoever. Sprint is now openly flouting the most elementary principles of contract law.
By the way, this new clause still does not give Sprint the right to change any of these fees without triggering the ETF-free cancellation clause. The cancellation clause clearly states:
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We may change any part of the Agreement at any time, including, but not limited to, rates, charges, how we calculate charges, discounts, coverage, technologies used to provide services, or your terms of Service. We will provide you notice of material changes—and we may provide you notice of non-material changes—in a manner consistent with
this Agreement (see "Providing Notice To Each Other Under The Agreement" section). If a change we make to the Agreement is material and has a material adverse effect on Services under your Term Commitment, you may terminate each line of Service materially affected
without incurring an Early Termination Fee only if you: (a) call us within 30 days after the effective date of the change; and (b) specifically advise us that you wish to cancel Services because of a material change to the Agreement that we have made.
Sprint claims to follow the CTIA Consumer Code. However, the Code says:
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Carriers will not modify the material terms of their subscribers' contracts in a manner that is materially adverse to subscribers without providing a reasonable advance notice of a proposed modification and allowing subscribers a time period of not less than 14 days to cancel their contracts with no early termination fee.
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Sprint has thrown its CTIA Code certification out the window.
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by Back_n_TX Posted Fri February 24, 2012 @ 11:31 AM
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I'd have to see the entire contract to see if it was covered, but I'm betting that Sprint does not consider an additional $1.50 to be a materially adverse change to the contact. I suspect that they classify it as a non-material change.
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by Steve OH (IO) Posted Fri February 24, 2012 @ 10:41 AM
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critical wording of the agreement (at least, the part of it you present). What does the FCC say about it? The fact that you've contacted them and still didn't get the resolution you wanted makes me suspect that Sprint didn't violate any terms of your contract.
It sucks, but big companies like this always dictate contract terms. We little people have to like it or lump it.
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