Issue: False Advertising

Lieff Cabraser served as co-lead counsel in a nationwide class action against TracFone Wireless alleging that TracFone falsely advertised that its StraightTalk, Net10, and Simple Mobile cell phone plans provided “unlimited” data. Contrary to this misrepresentation, plaintiffs alleged that TracFone implemented internally established data usage limits that it purposefully failed to disclose to consumers, and regularly “throttled” (i.e., significantly reduced the speed of) or terminated customers’ data plans pursuant to the secret limits. Plaintiffs’ legal claims included breach of contract and violation of California’s and Florida’s unfair competition and false advertising laws.

In 2015, the parties reached a class settlement, pursuant to which TracFone agreed to pay $40 million to reimburse consumers and to make changes to its disclosures. The settlement was approved by the Court in 2016.

Under the settlement, TracFone and its brands can no longer state in their advertisements and marketing materials that any plan provide “unlimited data” unless there is also a clear, prominent, and adjoining disclosure of any applicable throttling caps or limits.