Birmingham News (AL)
INTERNET CELL-PHONE VENDOR SUED OVER REBATES CLASS ACTION SOUGHT
IN CASE FILED IN BIRMINGHAM
Date: January 17, 2007
Section: BUSINESS
Page: 1-D
Article Written by: RUSSELL HUBBARD, News staff writer
THE COURTS
A disgruntled cell phone user has filed a lawsuit in U.S.
District Court in Birmingham, saying one of the largest Internet
sellers of wireless devices failed to follow through on promised
rebates.
Tom Vincent of Hattiesburg, Miss., said in his suit filed last
week that Washington, D.C. based InPhonic Inc. routinely refuses
to send promised rebates after customers buy phones or services.
The case was filed in Alabama because InPhonic, which sells via
Internet Web sites, did business in the state. Vincent is
represented by the Birmingham-based Belt Law Firm.
At the heart of the dispute is a $150 rebate Vincent says he was
promised for buying a new
Motorola Razr V3 phone and calling plan. He bought both from an
InPhonic Web site called
CellularChoices.net. After almost one year and two attempts to
get the rebate money, Vincent
has gotten nothing but aggravation, the suit says.
“InPhonic has knowledge of statistics that prove after one or
more failed attempts to claim a rebate, customers will
eventually give up and stop their pursuit,” Vincent’s suit says.
“Instead of honoring its obligations as promised, the defendant
has chosen to make the process of claiming a rebate so
time-consuming and frustrating that consumers give up.’
Spokesman Trip Donnelly acknowledged the fast-growing InPhonic
has faced challenges over rebates, and said the company has
reduced its use of them, settled a lawsuit over them with the
District of Columbia attorney general and hired more people to
monitor rebate compliance.
Inphonic sells phones at a discount in cooperation with wireless
providers and manufacturers through its Websites, which include
Wirefly.com, Wireless-World.com and Cellular-one.com. The suit
says it’s common for the company to offer a rebate if correct
forms are sent within a specified time. Collecting them is the
problem, lawyer Keith Belt said.
“They have these onerous requirements and they just never pay,”
Belt said.
The suit is seeking class-action status. Belt said that as many
as a half million people might have never gotten their rebates.
“That kind of money doesn’t go unnoticed on the balance sheet,”
he said.
Donnelly of InPhonic said the company has hired a new company to
process its rebates, and that it’s offering far fewer of them.
‘We have already worked through this with the D.C. attorney
general,” he said. “It’s unfortunate, but the rebate provider we
had been using just couldn’t adapt to our growth.”
Donnelly said publicly traded InPhonic has grown from $500,000
in sales in 2000 to $400 million in 2006. “We were named the
fastest growing company by Inc. magazine two years ago,” he
said.
