Verizon Wireless Settles with N.Y.

It turns out that Verizon Wireless $59.99 broadband plan wasnt so unlimited after all. Admitting the plan actually only covered Web browsing, e-mail and intranet access, the nations second-largest wireless carrier agreed Oct. 23 to pay $1 million to customers for wrongful account termination and to halt the deceptive marketing of its Internet usage plans.

The settlement ends a nine-month investigation by the New York State Attorney Generals office into Verizon Wireless marketing of its “unlimited” laptop broadband customer plans. The probe revealed Verizon Wireless did not disclose to users that video downloading and online game playing were not part of the plan.

As a result, the carrier terminated the service of some customers for exceeding an undisclosed monthly usage cap. From 2004 until April 2007, Verizon Wireless terminated more than 13,000 consumers nationwide for “excessive” use of its “unlimited” Internet access plans.

The customers were subsequently unable to use their Verizon Wireless cell phones and modems to connect to the Internet.

“This settlement sends a message to companies large and small, answering the growing consumer demand for wireless services. When consumers are promised an unlimited service, they do not expect the promise to be broken by hidden limitations,” N.Y. Attorney General Andrew Cuomo said in a statement. “Consumers must be treated fairly and honestly. Delivering a product is simply not enough—the promises must be delivered as well.”

New York-based Verizon Wireless agreed to reimburse all terminated consumers for the cost of wireless access cards or cell phones bought by the consumer as a part of the companys wireless Internet service. The company estimates the total amount of restitution to be about $1 million nationwide.

Verizon Wireless also agreed to pay penalties and costs of $150,000 to the state of New York and revise its wireless Internet marketing plans.

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