Oregon Department of Justice

Attorney General Hardy Myers today filed an amendment to a 2003 agreement between AT&T Corporation of Morristown, New Jersey and the Oregon Department of Justice. The amendment to the year-old settlement concerned a new monthly fee that was allegedly tacked onto consumers' established pay-per-call plans without giving proper notice. The Assurance of Voluntary Compliance amendment was filed in Marion County Circuit Court and admits no violation of law.

"No system is perfect when it comes to notifying customers of service or rate changes but when 200 Oregonians filed complaints with Justice and the Public Utility Commission (PUC) about improper notice from AT&T, it wasn't a minor problem," Myers said.

"Through this cooperative effort with the Attorney General's office, I'm hopeful consumers will be satisfied with this outcome," said Commission Chairman Lee Beyer.

Both the PUC and Justice began receiving consumer complaints in late January 2004 concerning a $3.95 monthly fee that had been added to their AT&T Basic Rate Long Distance Plan that previously contained only charges for long distance telephone calls placed. At that time, approximately 77,000 Oregonians were associated with the Basic Rate Plan.

Most of the 200 consumers complained that they were totally surprised by the charge because they had either terminated their AT&T service or thought that they had never been associated with AT&T long distance service in the first place.

Many former customers later discovered that they had to terminate with both AT&T and their local telephone company in order to permanently remove themselves from the service. Some contacted AT&T and others their local telephone company or an AT&T competitor and assumed that the companies would notify each other of the terminations or changes.

Some consumers had never used AT&T long distance services but their telephone numbers had been associated with AT&T years before and simply remained connected.

AT&T had sent a post card to the approximately 77,000 so-called customers associated with the Basic Rate Plan, telling them of the new fee but many tossed the cards as junk mail because they didn't consider themselves to be customers.

PUC and Justice staff discovered that when customers tried to dispute the $3.95 charge, they may have found themselves having to clear hurdle after hurdle and were faced with sales pitches.

Under the AVC amendment, AT&T is required to do the following:

• Send a written notification to all Oregon consumers who discontinue their service that they also must contact their local telephone company. The notice must be sent within 15 days of notice of termination.
• Send a written notice to all Oregon consumers billed for the Basic Rate Long Distance Plan after January 1, 2004, explaining the new recurring monthly fee, the necessity to cancel services with both the long distance carrier and their local telephone company, and the process and telephone number for the consumer to use to inquire about receiving a credit or refund.
• Provide restitution in the form of credits or refunds based upon an agreed formula for up to 77,000 Oregonians.
• Submit restitution disputes that may arise from the agreed formula to the PUC customer services for resolution.
• Provide a separate toll-free number that consumers must call to inquire about credits or refunds and to notify AT&T that they have cancelled their AT&T service with their local telephone company.

AT&T has paid Justice $25,000 for its Consumer Protection and Education fund bringing the long distance carrier's total payment to the fund under the 2003 AVC to $100,000.

Consumers wanting more information about this settlement may call the Attorney General's consumer hotline at (503) 378-4320 (Salem area only), (503) 229-5576 (Portland area only) or toll-free at 1-877-877-9392. Justice is online at www.doj.state.or.us. The PUC Consumer Services number is (503) 378-6600 (Salem area only) and toll-free at 1-800-522-2404.