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CenturyLink’s latest way to avoid customer lawsuits is the most creative yet

CenturyLink lawsuit over deceptive billing

CenturyLink is currently facing lawsuits from disgruntled customers and the state of Minnesota, all alleging the same thing: That CenturyLink quoted customers one price, and then used shady fees and add-ons to make the monthly bill significantly more.

You’d think that the company might fight a suit like this by bringing out evidence of contracts, or finding expert witnesses to defend its advertising practices in court. Not so: Instead, CenturyLink is using the novel defense of claiming it doesn’t have any actual customers.

In court documents found by Ars Technica, CenturyLink makes the case that CenturyLink, Inc.doesn’t have any customers of its own; instead, there are 10 subsidiary companies spread throughout the country that customers are subscribers to. The only thing is that their websites direct straight to, and the customers don’t ever recall doing business with the subsidiary. Nonetheless, that’s the defense CenturyLink is running with. From the court filing:

Plaintiffs have made a fundamental error by choosing to sue the wrong defendant – a company that had no role whatsoever in the predicate acts underlying their claims. That sole defendant, CenturyLink, Inc. (“Defendant”), is a parent holding company that has no customers, provides no services, and engaged in none of the acts or transactions about which Plaintiffs complain. There is no valid basis for Defendant to be a party in this Proceeding: Plaintiffs contracted with the Operating Companies to purchase, use, and pay for the services at issue, not with CenturyLink, Inc.; and the claims in the Consolidated Class Action Complaint attack either the quality of the Operating Companies’ services or the amounts the Operating Companies billed to Plaintiffs.

CenturyLink’s own website certainly hides those facts well. Even the terms and conditions section of the website says that “the names EMBARQ and CenturyTel may be used in association with certain products and services provided by CenturyLink,” which doesn’t quite line up with CenturyLink’s legal filing saying that it “provides no services.”

In any case, this is all part of a broader legal strategy to force the customers into binding arbitration, rather than an open court case. CenturyLink claims that 37 of the 38 plaintiffs signed arbitration clauses with their local subsidiaries, something that the plaintiff’s attorney Benjamin Meiselas disputed to Ars:

“The arbitration clauses they’re trying to enforce post-date the litigation,” he said. CenturyLink frequently offered service to customers without contracts, often via door-to-door salespeople who signed up elderly customers, he said. If the customers didn’t have a contract, they couldn’t have agreed to an arbitration clause, he said.

The case also includes allegations that CenturyLink created fake accounts in order to overcharge customers. Since customers never signed contracts for those fake accounts, they couldn’t have agreed to arbitration in those instances, Meiselas said. “It logically follows that you didn’t sign a contract for something you didn’t contract for in the first place,” he said.

CenturyLink’s legal troubles started when former employee Heidi Heiser, a work-from-home sales rep, filed suit against CenturyLink. Heiser said that she asked CenturyLink’s CEO why the company”allowed persons who had a personal incentive to add services or lines to customer accounts to falsely indicate on the CenturyLink system the approval by a customer of new lines or services” during a company Q&A on an internal message board. According to the suit, Heiser was fired the next day. Following that, a class-action suit was filed on behalf of customers seeking compensation for damages. It cited Heiser’s suit, as well as public complaints about similar-sounding problems.