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Michigan Challenges One-Sided Cell Phone Contracts

35 Other States Join Michigan Supreme Court Filing

May 22, 2006

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Michigan has opened the latest skirmish in the widening battle to protect consumers from one-sided and unfair cell phone contracts.

Michigan Attorney General Mike Cox has filed a brief asking the U.S. Supreme Court to rule on the issue of permitting states to protect consumers against one-sided cell phone contracts.

Thirty-five other state Attorneys General joined Cox's request.

"States have a constitutional right to protect their citizens from unfair contracts," said Cox. "This case is important to consumers throughout Michigan and the country. States should be allowed to vigilantly protect their citizens from unfair cell phone contracts."

The case, involving Verizon Wireless, arises out of an 8th Circuit Court of Appeals decision striking down a Minnesota law which gave consumers certain rights prior to unilateral changes being made in their cell phone contracts.

The Minnesota legislature had passed a law which required cell phone companies to provide basic consumer protections such as advance notice of rate increases or extensions to their contract length.

One Minnesota resident had testified during legislative hearings that his month-to-month contract had been extended to a one-year contract without his knowledge. When he tried to cancel, he was charged a $150 early termination fee.

In Michigan, cell phone complaints to the Attorney General are up 50% over last year.

The Court will consider the request and decide whether to hear the case in its 2006-2007 term.

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