2 Class Actions Against PelePhone Certified by District Court

The Tel Aviv District Court recently approved a class action lawsuit filed against cellular phone provider Pelephone for charging customers a fee of 85 NIS in order to unlock their phones for use with SIM cards from other providers. The complainant claimed that such fees were against the Communications Law and violated the terms of PelePhone operating license.

PelePhone argued that it did nothing wrong.

Another class action against PelePhone was also certified around the same time. This one had to do with PelePhone option for customers to pay for music to be played to callers to their numbers in place of a standard ring. Customers paid 6.93 NIS for the service. Before the music was played to callers, they heard a 5.6 second message saying, "Do you like this song? If so, press * two times and it will be sent to your cellphone, for a fee." The lawsuit claimed that PelePhone did not have the customers' permission to solicit these purchases on time that was ostensibly paid for by the customers for the transmission of music.The lawsuit claimed the PelePhone breached its agreement and was unjustly enriched on the backs of its customers.

PelePhone claimed that it provided discounted songs to customers and because of that benefit, the class action did not accurately represent all of its customers and was against their interests. Further they claimed that most of their customers knew about the messages and so implicitly agreed and furthermore, it was easy to cancel the service and the messages by speaking with a PelePhone representative.

The Court rejected PelePhone's claims saying that it was not clear that customers knew about the messages and that they could cancel the messages. The Court also rejected the argument that the service benefited customers because it was still a source of revenue for PelePhone and appears to be a breach of the contract. PelePhone used the paid-for time of its customers without their permission.

Both of those decisions only permit the class action to proceed; there will be further decisions about the substantive issues at a later date unless the parties reach a settlement.