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Nextel Settles For $750,000

LOS ANGELES, CA -- A Superior Court judge has approved a $750,000 settlement
between Nextel Communications Inc. and customers, putting an end to a
six year-old lawsuit over charges for paper bills.

Los Angeles County Judge John Shepard Wiley Jr., filling in for Judge
Anthony J. Mohr, approved the settlement Thursday. Mohr is currently
sitting by designation on the California Court of Appeal.

After subtracting court costs and attorneys' fees, affected consumers
should receive about $20 per person beginning in approximately two
months, said Todd M. Foreman, a staff attorney at Santa Monica-based
Consumer Watchdog. Foreman, who, along with Leigh A. Parker, a
principal at Weiss & Lurie in Los Angeles, represented the
plaintiffs in the lawsuit.

The suit alleged it was illegal for the company to charge customers to
see their itemized bills sent through the mail. Settlement papers
revealed Nextel "expressly" denied all liability in the case.

Current Nextel customers will receive credits in their billing
statements while former subscribers will get cash compensation,
according to court documents.

More importantly, consumers won the right to see their bills for free, Foreman said.

"You can't squeeze out extra nickels and dollars from customers by
charging them to read their own bill," said Doug Heller, executive
director of the non-profit Consumer Watchdog. "We've been able to
change practices at this company."

Dominic Surprenant, a partner at Quinn Emanuel Urquhart Oliver &
Hedges in Los Angeles, who helped represented Nextel, was unavailable
for comment.

The $20-per-person settlement amount is roughly half of what each
consumer actually paid, which constitutes "a really great victory in
terms of settlement," Foreman said, adding it usually takes a
successful trial victory for plaintiffs to achieve that large of a
percentage.

The October 2003 suit accused Nextel of failing to credit subscribers
for its spam text messages. The class included Nextel consumers who
paid the fees between September 2003 and October 2006, court papers
state. Marlon Campbell v. Nextel Communication Inc. BC304559

The plaintiffs accused Nextel of violating California's consumer
protections laws by engaging in unlawful, unfair and fraudulent
practices.

During the course of the litigation, tort reform altered the lawsuit to
a degree. In 2004, California voters approved Proposition 64, a ballot
initiative that restricted private lawsuits against a company only to
plaintiffs who had suffered an actual injury because of the alleged
unfair business practices.

The Nextel lawsuit, whose original plaintiff was Consumer Watchdog -
then known as The Foundation for Taxpayer and Consumer Rights - was
dismissed after the trial judge ruled Prop. 64 applied retroactively.

An appeals court reversed the lower court and instated the lawsuit. The
complaint later was amended to include Nextel subscriber Marlon
Campbell as plaintiff.

Contact the author at: ciaran_mcevoy@dailyjournal.com