/ June 3, 2008

Decreasing Cancellation Fees: Necessary and Proper?

A ruling over cell phone cancellation fees could bring the argument of state versus federal powers back to the courts. Since the arrival of cell phones on the market, there have been outrageous fees associated with cancelling service plans. While consumers view the fees as a way for companies to trap you into paying for years of what may be less than adequate service, the companies defend their right to charge the fees as a way to offset costs. The FCC has introduced a plan to standardize the fees nationwide at a more reasonable rate. Why aren’t consumers satisfied? New legislation controlling the fees would eliminate the possibility of bringing class action suits against any of the companies upsetting industry, consumer groups and law firms alike.

In spite of this limitation, it’s possible that the introduction of this type of legislation would bring about a different kind of lawsuit. Considering the historical precedence of states controlling such a matter, some may question the constitutionality of such legislation. As it is clearly stated in the Constitution, states are granted exclusive power to regulate intrastate commerce, a boundary that many believe the Federal government would be overstepping. It will be interesting to follow whether or not this case will raise questions over state and federal boundaries again.

Comments are closed.