Chicago Illinois Atty. Gen. Jim Ryan sued Sprint Communications Thursday, charging the long-distance phone carrier uses deceptive and confusing advertising to lure consumers.
Illinois is the lead state in a multistate investigation into the deceptive practices of three major long-distance phone companies. Other states have filed lawsuits against WorldCom and AT&T. Connecticut also filed suit against Sprint.
Ryan's lawsuit alleges that Sprint's rates are much higher than advertised due to hidden costs or regulations that are not disclosed to consumers.
"Sprint, we are alleging, used various nationwide ads, one featuring actress Sela Ward, to lure consumers with promises of services for pennies per minute when, in reality, the bills involved nickels, dimes, quarters and much more per minute," Ryan said.
The lawsuit targets four long-distance plans: Sprint 1000 Nights, Sprint 1000 Weekends, Sprint Sense Any Time and Sprint Nickel Nights.
Advertisements for Sprint 1000 Weekends offer consumers 1,000 minutes of long-distance calls on the weekends for a $20 monthly fee, making calls for as low as 2 cents per minute. But the ads do not disclose that Sprint charges $20 every month regardless of how many minutes are used. And if consumers call long distance during the week or within Illinois, they pay 10 cents per minute. Sprint also adds monthly fees to each plan.
Ryan said such practices violate the Illinois Consumer Fraud and Deceptive Business Practices Act by failing to disclose that advertised prices do not apply to intrastate long-distance calls, that monthly fees exist, that unused minutes cannot be carried over to following months and that line and service charges are automatically added to monthly bills.
Lydia Steinberg, a Sprint spokeswoman, said company officials had not seen the lawsuit and could not yet comment on Ryan's specific allegations. But she said Sprint stands behind its advertising practices.
"We are confident that our ads are clear and accurate," Steinberg said.
Illinois sued Sprint because many of the complaints from Illinois consumers were related to Sprint's services, Ryan said. He said the attorneys general involved in the investigation are suing different long-distance companies because they decided to divide the labor.