Britain’s largest mobile phone companies are facing a class action lawsuit seeking over £3.3 billion ($4.1 billion) in damages after lawyers claimed on Friday that customers had been overcharged.
Vodafone, EE, Three, and O2 are accused of imposing “loyalty penalties,” which result in current customers paying more than new customers for the identical services, according to law firm Charles Lyndon, which brought the lawsuit along with Justin Gutmann, a consultant on consumer legal rights.
The accused responded by refuting the claim and requesting further information.
The issue concerns contracts in which a customer purchased a phone together with airtime services.
It claims that the companies neglected to reduce the overall amount charged once the minimum contractual time expired, despite the fact that customers had paid in full for the phone.
The class action has been launched with the Competition Appeal Tribunal in London, and unless they opt out, all qualifying consumers are automatically involved in the lawsuit for free.
The big four reportedly overcharged on up to 28.2 million contracts, resulting in £3.285 billion in damages claimed.
Gutmann stated that if successful, a consumer who purchased a contract with one of the mobile providers that included a mobile phone and services such as data, minutes, and calls might get up to £1,823.
“I’m launching this class action because I believe these four mobile phone companies have systematically exploited millions of loyal customers across the UK through loyalty penalties, taking over £3 billion out of the pockets of hard-working people and their families,” Gutmann said in a statement.
“These companies kept taking advantage of customers despite the financial crisis of 2008, Covid and now the cost-of-living crisis. It’s time they were held to account.”
Responding, EE said “we strongly disagree with the speculative claim being brought against us”.
Vodafone said it had yet to “have sufficient detail for our legal team to assess”.
An O2 spokesman added: “To date there has been no contact with our legal team on this claim. However, we are proud to have been the first provider to have launched split contracts a decade ago which automatically and fully reduce customers’ bills once they’ve paid off their handset.”