Frontier Communications agreed to a settlement of more than $60 million to resolve a lawsuit based on allegations that it had conducted misleading marketing practices in the state of Connecticut, according to an announcement from the office of Connecticut Attorney General William Tong. The operator on Friday also struck a $15 million settlement deal with Indiana Attorney General Todd Rokita to address allegations it misrepresented internet speeds and reliability to consumers.
The Connecticut settlement follows an investigation by Tong’s office that was based on a review of more than 1,400 complaints from customers about a range of issues, from poor service quality to hidden charges to billing for equipment that already had been returned.
In a statement, Tong had harsh words from Frontier, which is headquartered in Norwalk, Connecticut. “Frontier failed Connecticut consumers,” he stated. “Their DSL internet quality was slow and unreliable, and their customer service was unacceptable. They tacked on hidden fees, charged families for returned equipment, and kept charging customers even after services had been canceled. That ends now.”
The settlement calls for Frontier to invest more than $42 million over the next three and a half years in fiber-based broadband service to reach economically distressed communities, including the 40,000 households “most harmed by the company’s sub-par DSL service,” Tong stated.
Frontier also must discontinue a hidden $6.99 monthly internet fee “that cost Connecticut families [on average] $84 last year alone,” amounting to about $16 million total statewide, according to the statement.
In addition, Frontier must pay another $1 million to the state, and deliver $200,000 in refunds to customers who have filed complaints over the last three years, a period of time during which Frontier filed for bankruptcy, began a major restructuring program, and sold off properties in other parts of the U.S. The company has since said it is refocusing its energies around fiber upgrades.
The agreement also provides protections for consumers offered fiber upgrades, including a 45-day period to decide whether to transition to fiber internet, protections against early termination or disconnection fees if they elect to cancel Frontier service, access to new customer promotional rates, and information about internet subsidies through the federal government’s Affordable Connectivity Program, which provides a discount up to $30 per month on the cost of internet service for eligible low-income consumers.
Earlier this year, Frontier agreed to pay $8.5 million to settle a lawsuit from the Federal Trade Commission (FTC) alleging it misled consumers about the speeds offered by its DSL internet service. As part of that deal, Frontier consented to deploy fiber to 60,000 homes in California over the next four years. Arizona, Indiana, Michigan, North Carolina and Wisconsin were originally party to the FTC's lawsuit but subsequently dropped out. However, several of those states eventually came to their own agreements with the operator to alleviate their concerns. Commitments from those deals included promises to spend $15 million each in Wisconsin and Michigan over the next four years to improve its network.
Indiana became the latest to secure its own $15 million commitment this week. As part of that settlement, the operator agreed to voluntarily change its advertising and offer alternative plans to customers in the state who are currently receiving internet speeds lower than those promised.