Is Sprint Going To Get Into A Class-Action Suit Over Its Merits In Subscribing To The GSM Industry Group?
Sprint sued AT&T over its usage of 5G E branding for phones which are just now hitting the markets. The Sprint lawsuit claims AT&T is being dishonest with consumers by using this technology for their phones. They say it’s not clear what the company intends to do with the service, whether it will become popular or not. In January, new 4G LG phones began showing off 5G connectivity, and it allegedly began appearing on Apple iPhones a few days later. A representative from Google confirmed to the Associated Press that iPhone and LG phone users can connect to the internet via a connection via AT&T’s GSM cell phone network.
AT&T says it has a legitimate agreement with LG over the use of the technology.
It says that the two companies have signed an agreement for the distribution of mobile devices. But Sprint contends that the sale of the cards with the use of the 5G wireless network was only part of a wider plan to introduce the service to consumers. The company further says that this is the first major phone manufacturer that is adopting the more advanced technology. It says that it still needs to secure agreements with other phone manufacturers to offer the service to its customers.
It’s not surprising that this lawsuit is generating a lot of buzz in the wireless industry because of the potential profitability of the deal. Many large carriers, like AT&T, Verizon, and Sprint, are struggling with declining profit levels and are making large-scale consolidation moves. Such moves are usually bad news for independent wireless network operators who compete with large carriers for subscribers. But this lawsuit doesn’t seem to indicate any wrongdoing on AT&T’s part.
There are many reasons why this lawsuit is likely a sideshow instead of a real issue.
The lawsuits have obvious commonalities – the two wireless carriers are attempting to use exclusive rights to introduce the new technology into the market. And they also have one major thing in common. They both want to control the rapidly growing mobile communication market with their technologies. So the fact that both AT&T and Sprint are trying to establish their virtual network is not particularly surprising.
But there’s something really strange about Sprint’s lawsuit against AT&T.
It seems to involve a bunch of technical and legal jargon, but the lawsuit doesn’t make clear what it is that Sprint wants from the deal. For example, it says that AT&T committed “a variety of anti-competitive actions and agreements” in violation of patents held by the two former employees. It further claims that these activities amount to “a willful violation of the right of the United States.” What is meant by that?
The lawsuit doesn’t explain what the alleged anti-competitive actions or agreements were, or what they have anything to do with Sprint’s low-income or free wireless services. Nor does the attorney general explain what rate plans were misrepresented to customers. All the attorney general is doing is repeating a statement by a former AT&T wireless executive, who said that the company would “accentuate” low-income and free services to draw more wireless customers. (AT&T later denied this claim.)
But now the attorney general has stepped in again, claiming that the original statements were wrong and that Sprint broke the law by attempting to impose rates that made it impossible for low-income families to afford the service. (The original agreements said that subscribers would pay for the first year at a flat rate, then the rates would gradually increase.) But the attorney general isn’t entirely correct when he says that the original rate plan was illegal, either.
The Federal Communication Commission tried to intervene between the companies and make a ruling, but that decision was denied by the court.
So now Sprint faces a possible class-action suit from all of its customers because the FCC did not act properly in trying to stop the company. While the class-action lawsuit might not succeed, the Sprint lawsuit may go ahead and could result in a significant judgment against Sprint. So, either way, it looks as if Sprint may be headed for some major trouble. And, if the class-action suit does go ahead, it looks as if Sprint will not be able to fight back against the wireless carriers, which are clearly in cahoots with the wireless carriers.
