Verizon Faces $100 Million Payout, Eligible Customers Can Claim Up to $100

The company has proposed a compensation agreement without admitting wrongdoing.

Commuters look at their mobile phones as they wait for a subway train in New York on June 10, 2021. Ed Jones/AFP via Getty Images

Verizon has agreed to pay $100 million to settle allegations of deceptive practices in a class-action lawsuit.

Eligible customers seeking a cut of the payout will be able to submit a claim for up to $100 each as part of a proposed compensation agreement reached between the customers and Verizon to resolve the lawsuit on a class-action basis.

The lawsuit claimed that Verizon customers were subjected to an administrative charge as part of what was described as a “deceptive scheme.”

The company is accused of promoting its wireless services with monthly rates lower than the actual charges incurred by customers.

The actual charges include an administrative charge it allegedly “imposes each month on every line purchased by its post-paid wireless service customers.”

The eligible group that can submit claims comprises all Verizon customers, both current and former, in the United States.

Verizon customers claimed that the company charged unfair and inadequately disclosed monthly charges to its post-paid individual consumer wireless service account holders.

The charges in question include Administrative Charge and/or Administrative and Telco Recovery Charge.

The customers covered in the lawsuit received postpaid wireless or data services between Jan. 1, 2016, and Nov. 8, 2023.

Postpaid phone plans involve a contractual agreement with a phone provider, with monthly billing based on usage, in contrast to prepaid plans.

Those qualifying for compensation should have received a notice by mail or email.

Despite reaching the compensation agreement, Verizon denies any wrongdoing and maintains that the lawsuit lacked merit, according to the settlement website set up for affected customers to submit their claims.

To claim their payout, individuals need the ID and confirmation code from the settlement notice and must submit a claim online by the deadline of April 15.

The final payout for each person remains uncertain, as is typical of class action lawsuits, as it depends on the number of approved claims.

The $100 million fund may be shared among millions of Verizon customers.

The proposed settlement noted key dates for customers in the class action other than the April deadline for submitting a claim for payment.

The deadline for opting out and preserving the right to independently sue Verizon is Feb. 20.

Objections or comments on the settlement terms can be submitted until Feb. 26.

The crucial Fairness Hearing, the court’s final opportunity for evaluating the proposed settlement, is set for March 22.

According to a fact sheet published by the company last year, Verizon reported 92.7 million “wireless retail postpaid connections” in its consumer division and 29.5 million in its business division.

While the minimum payment for eligible members is expected to start at $15, it will increase by increments of $1 based on the duration of a customer’s association with Verizon, with a maximum payout of $100 per customer.

Upon approval and finalization of the settlement, payments will be disbursed via check or electronic payment.

Although Verizon intends to continue charging the contested administrative fee, it has agreed to amend its customer agreement to enhance disclosure.