Alabama settles lawsuit with Vonage

MONTGOMERY, AL (WBRC) - Alabama Attorney General Troy King announced Tuesday a $3 million, 32-state settlement with VOIP phone service provider Vonage.

King, in a statement to FOX6 News, said Vonage will refund consumers and modify its cancellation and retention policies.

"This settlement protects consumers by making it easier for them to exercise their right to cancel Vonage if they wish, and by making it clearer what services are provided and at what cost," said King.  "It is important also that eligible consumers will receive refunds for their claims of unauthorized charges."

The settlement addresses complaints in which consumers alleged having difficulty or being unable to cancel their Vonage VOIP, or Voice Over Internet Protocol, internet phone service. King said Vonage formerly paid incentives to customer service representatives for retaining or "saving" customers in lieu of cancellation, when consumers called to cancel. As a result, consumers reported that cancellation was extremely difficult and sometimes impossible.

King said the lawsuit agreement puts strict limitations on this practice and requires recording and verification of these telephone calls.

The settlement puts in place a broad restitution plan requiring Vonage to make refunds to eligible consumers who filed complaints regarding unauthorized charges from January 2004 to March 16, 2010, which have not been resolved.  Consumers who believe they may be eligible for such refunds may contact Attorney General King's Consumer Protection Division by calling toll-free 1-800-392-5658, by mail to 500 Dexter Avenue, Montgomery, Alabama 36130, or through the webpage at  

Claims must be filed by March 16, 2010.