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N.Y., Charter Spectrum Settle 2017 Internet Speed Lawsuit; Some Customers Getting Refunds

Phillip Dampier December 18, 2018 Broadband Speed, Charter Spectrum, Consumer News 7 Comments

A $174.2 million consumer fraud settlement has been reached between outgoing New York Attorney General Barbara D. Underwood and Charter Communications, delivering $62.5 million in direct refunds to some customers in former Time Warner Cable Maxx territories in New York State and free premium and streaming services for all current New York customers.

The settlement, likely the largest ever reached with an Internet Service Provider (ISP), comes in response to a 2017 lawsuit filed by former Attorney General Eric Schneiderman, accusing Time Warner Cable of short-changing customers on broadband speed and reliability, by knowingly advertising internet speeds it could not deliver. Time Warner Cable was acquired by Charter Communications in 2016.

“This settlement should serve as a wakeup call to any company serving New York consumers: fulfill your promises, or pay the price,” said Underwood. “Not only is this the largest-ever consumer payout by an internet service provider, returning tens of millions of dollars to New Yorkers who were ripped off and providing additional streaming and premium channels as restitution – but it also sets a new standard for how internet providers should fairly market their services.”

The settlement allows Charter to admit no wrongdoing, but the company is required to compensate Spectrum customers in New York and reform its marketing practices. Going forward, Spectrum must offer evidence through regular speed testing that the company can actually deliver advertised speeds. Charter is also required to continue network investments in New York to improve its internet service.

Lawsuit History

Schneiderman

In 2017, the Attorney General’s office filed a detailed complaint in New York State Supreme Court, alleging that Charter had failed to deliver the internet speed or reliability it had promised subscribers in several respects. That includes leasing deficient modems and wireless routers to subscribers – equipment that did not deliver the internet speeds they had paid for; aggressively marketing, and charging more for, headline download speeds of 100, 200, and 300 Mbps while failing to maintain enough network capacity to reliably deliver those speeds to subscribers; guaranteeing that subscribers would enjoy seamless access to their chosen internet content while engaging in hardball tactics with Netflix and other popular third-party content providers that, at various times, ensured that subscribers would suffer through frozen screens, extended buffering, and reduced picture quality; and representing internet speeds as equally available, whether connecting over a wired or Wi-Fi connection – even though, in real-world use, internet speeds are routinely slower via Wi-Fi connection.

The Attorney General’s office prevailed at every major stage of the court proceedings. After Charter sought to move the case to federal court, the Attorney General’s office won a federal court decision returning it to state court. Charter then moved to dismiss the action on various grounds, including federal preemption; the Attorney General’s office successfully opposed that motion, which the trial court denied in full. When Charter appealed parts of that ruling, the Attorney General’s office prevailed again at the Appellate Division.

Underwood

The Settlement

Under the settlement, New Yorkers will be qualified to receive different levels of compensation as a result of the settlement. Here is what customers can expect:

Only current Charter Spectrum internet customers (including those on legacy Time Warner Cable internet plans) can receive benefits under this settlement. If you do not have service today, but had it in the past, you do not qualify for relief.

Cash Refunds

Only customers living in areas upgraded to Time Warner Cable Maxx service can receive cash compensation. At the time of the lawsuit, this included much of New York City area, the Hudson Valley, parts of the Capital Region, and Syracuse-Central New York. Additionally, the customer must have subscribed to a Time Warner Cable legacy speed plan of 100 Mbps or higher. (Customers in non-Maxx areas including Buffalo/WNY, Rochester-Finger Lakes Region, Binghamton, and the North Country will not receive financial compensation.)

If you did subscribe to 100+ Mbps Time Warner Cable service and still subscribe to either your original legacy plan or have since upgraded to a Spectrum plan, you may qualify for:

  • a $75 refund (700,000 subscribers) if you were supplied an inadequate cable modem or Wi-Fi router by Time Warner Cable.
  • an additional $75 refund (150,000 subscribers) if you were leasing an inadequate cable modem for 24 months or longer.

You do not need to take any action to get these refunds. Charter Spectrum will notify eligible subscribers about the settlement and provide refunds within 120 days. (If you previously received a refund for being supplied with an inadequate modem, you are ineligible for this cash refund).

Free Services

Only former TWC Maxx customers qualify for cash refunds.

In addition to the direct refunds detailed above, Charter will offer free streaming services to approximately 2.2 million active internet subscribers (both Spectrum and legacy Time Warner Cable plans qualify):

If you currently subscribe to both Spectrum Internet and TV service, you qualify for three free months of HBO or six free months of Showtime. (If you already subscribe to these premium movie channels, you are ineligible for this part of the settlement. If you subscribe to one, but not both of these networks, select the one you do not currently receive.)

If you currently subscribe to internet-only service from Spectrum, you will receive a free month of Charter’s Spectrum TV Choice streaming service—in which subscribers can access broadcast television and a choice of 10 pay TV networks—as well as a free month of Showtime.

Charter will notify subscribers of their eligibility for video and streaming services and provide details for accessing them within 120 days of the settlement. Receiving the video and streaming services as restitution will not affect eligibility for future promotional pricing.

Pro-Consumer Reform

New York also secured groundbreaking reforms in how Charter Spectrum conducts business. Underwood believes these guidelines could serve as a guide for other states to eventually adopt, delivering consumer benefits to cable subscribers everywhere. For now, New York consumers can expect:

  • Internet Speed Proof of Performance: Charter must describe internet speeds as “wired,” disclose wireless speeds may vary, and mention that the number of concurrent users and device limitations will impact your actual internet speed. These disclosures must be made in all marketing materials and ad campaigns. Additionally, Spectrum must regularly certify through actual speed testing that it can deliver the speeds it advertises or discontinue any speed plan that cannot be substantiated.
  • Truth in Advertising: Charter Spectrum cannot make unsubstantiated claims about the speed required for different internet activities (eg. streaming, gaming, browsing). It also must not advertise internet service as reliable (eg. no buffering, no slowdowns), or guarantee Wi-Fi speed without proof.
  • Equipment Reforms: Charter must provide subscribers with equipment capable of delivering the advertised speed under typical network conditions when they commence service, promptly offer to ship or install free replacements to all subscribers with inadequate equipment via at least three different contact methods, and implement rules to prevent subscribers from initiating or upgrading service without proper equipment for the chosen speed tiers.
  • Sales and Customer Service Retraining: Charter must train customer service representations and other employees to inform subscribers about the factors that affect internet speeds. Charter must also maintain a video on its website to educate subscribers about various factors limiting internet speeds over Wi-Fi.

Today’s settlement has no bearing on the well-publicized dispute between the New York Public Service Commission and Charter that led the Commission to cancel approval of Charter’s acquisition of Time Warner Cable. Last summer, the Commission voted to throw Spectrum out of the state, but ongoing negotiations between the PSC and Charter are also likely to culminate in a similar settlement including cash fines and new commitments from the cable operator.

Currently there are 7 comments on this Article:

  1. Fred Hall says:

    We’re an old TWC Maxx customer, but had our own modem. Plus we’ve been on a TWC triple play plan that still includes free Starz (which we never watch). So – after all these years of court fighting – 3 months of HBO for us…..BIG DEAL.

    Play it up NY State……I’m sure Spectrum is pissed, but $172M is pocket change. They probably spent that much on their lawyers.

  2. Dylan says:

    As I said in the fourms over at Dslreports. This is just a big game of circus for NYS. First it was this, now it’s the kicking out of Charter for failing to fulfill some vague promise of extending to these amounts of addresses, which in the case I seen, Charter did do, just not exactly how NYS politicians wanted to do it. Again, it’s all a game in the minds of NY and Charter knows this too. They just play along.

    But as I said in the other forums as well. This whole lawsuit that was brought on, was due to legacy TWC’s ability to keep up with infrastructure investments, equipment, etc, etc. I remember only 4-5 years ago, TWC tried giving me a 4 channel Docsis 3 modem, which I guess was adequate for 30 extreme speed that I had. But is actually laughable in comparison to other providers handing out 16 channel modems, or at least 8. Even some areas were already getting at that time in TWCs footprint 16 channel modems, but not mine. And all the reps had to say at the counter was that’s all we got and TWC won’t give us anything better really. I was like. Ok. I’ll just get my own modem and avoid the fee anyways. Just another case of TWC being behind the times, while scrambling like scrambled eggs to get MAXX finally rolling while other providers had better speeds and equipment already. Anyways. The point is. Legacy TWC tried to give old equipment that would eventually cause issues as the node saw more and more people attached to it because 4channels is only good for 140megs of throughput. Which with enough customers, could cause major issues with speed. Not only that, but what NYS seems to fail to understand, along with NYS Attorney General, that people’s internet equipment was most likely at fault most of the time. It’s exactly why the supervisor for now Charter Spectrum in my area said it was “not TWC’s fault really, but because people had poor routers or had their own equally as bad modem.

    Now of course this has all changed with Charter. It was not due to NYS poor lawsuits with little facts. But because Charter knows better and actually wants to spend on good equipment. That’s why now I can get a new modem from Charter at no cost, unlike TWC, and it’s actually really good. All they give out, like in my area, and many other areas, are the new E31 Docsis 3.1 modems. Which is fantastic besides the problem of not being able to access signals unless it’s a Ubee model out of the other two models which are Hitron and Technicolor. I have the Ubee model, which I got to replace the Hitron before it. But as I said. My office, just like many others now in legacy TWC territory, does not give out poor equipment anymore. That has changed. Also, say what you want about the new Spectrum guide (it has problems, but it’s a relatively new guide) and the Worldbox, but it’s better than the old Scientific Atlanta box’s TWC handed out for many years. Just like the old modems. It’s manly the reason why I could not go with their DVR at the time. Again, this was only 4-5 years ago. Now, if I wanted DVR (which I don’t) but if I did, I could get a new Worldbox 201-T or something of that nature, which is really good besides the currently buggy Spectrum Guide. Luckily when I got my Worldboxs, they had Navigator. Probably not the case anymore, as Spectrum in most areas is transitioning to the Spectrum guide. However, I’m sure it will improve. Navigator, like many other systems and guides, have to go through a time of bug fixing and so forth before becoming a decent guide or system.

    In addition. Charter Spectrum has decided to do a lot of things that are much better than
    legacy TWC was. Say what you want, but Charter provides. Separate router and modems. Much better. All on shore for the most part customer support. Which Tom Rutledge (CEO of Charter promised to do, which got done apparently a year or two ago, after the merger happened). No modem fees. Only a $5 charge for WiFi. Which I’m fine with because a, their new routers are not s÷it. They’re wave 2 routers, with 1800meg of throughput. It’s at least a $200 router. I have my own router anyways, but would get it if I had too. And I would not have a problem, unlike the gateways that TWC had, which while the WiFi was free with them (the modem was $10 anyways, which is more than the $5 charges for WiFi anyways that Charter charges), the WiFi router built into the gateways were terrible, at least from my testing. It may be different now for other companies that have gateways still like Comcast. But I much prefer the separate setup Charter has now. They don’t have data caps either. And unlike what people say. “Oh, it’s that way because the FCC banned it for 7 years from the merger closing”. No, it’s because Tom, again the CEO, does not want data caps on his services. He knows it impacts the business. And like any sane business. He wants to make money and create customer relations. Data caps hinder his ability to do that. Plus, Charter 18 months before the merger did not have data caps whatsoever. When they tried them out. They realized they would not work. Eventually due to 5G Comcast will change their policy of data caps as well. Along with Cox.

    Anyways. I created a huge essay basically, but I had to get my thoughts out there on it all. I’m not a shill like some like to say about people like me who; happens to critique Charter (such as on removing the signal page) but also praises them for the good accomplishments they make. I’m sorry to the people who believe I’m some shill for believeing that. But I thought that’s what you do. Praise for the good, and criticize the bad. But anyways. That’s all I have to say on this topic. I’m just glad it’s over.

    At least I guess I get some free HBO. Sounds great!

    • M says:

      Hahaha…u sound like u work for Spectrum. This company is a total scam. I have been with TWC for over 30 yrs and always paid $165 for internet, cable and phone and now they want $280 a month for the same service. I’ve moved on to Fios.

      Tom, the CEO, wants good customer relations? Please, go read Spectrum’s 479 one star reviews and see for yourself about the customer relations. They r a wrip off and a scam. I can’t wait to hear when they delist or go out of business bc they deserve it!

  3. EJ says:

    Until they admit fault these lawsuits are next to worthless. Need fault for it to become precedent and they new that. It is cool that people get a refund or whatever, but this is no game changer.

  4. Kristin says:

    Spectrum/Time Warner’s actions to slow speeds isn’t limited to NY. I hope this lawsuit is opened up to other states like Ohio.

  5. Susie says:

    It’s only a political ploy and spectrum will have pay the NY state PSC another pay day for Governor Cuomo. New York state is in a fiscal crisis this is easy money for the state to collect. I think we the customers are still getting ripped off we shouldn’t have free paid channels for 3 months I say give me the cash instead. we the customers will pay higher rates for internet and cable and another fee will appear to recop the 174M. So far there is no other cable company who wants to come into NY state not after this settlement. Governor Cuomo would be a terrible President. kick spectrum out of NY state do it Andy.

  6. fhall says:

    Moving on to FIOS is nice – if you have that option…..a lot of us don’t have any other high-speed option, and Spectrum knows it.







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