AT&T sued over hidden admin fee

AT&T is facing a class-action lawsuit in California over its practice of charging a $1.99-per-month "Administrative Fee" that isn't disclosed in its advertised rates. According to the complaint, the company is prominently advertising a monthly flat rate for all their postpaid subscribers, and the almost-two dollar fee is undisclosed in all their ads.

The suit accuses AT&T of violating California's Consumer Legal Remedies Act, and it says that AT&T can't sidestep the lawsuit because the arbitration provision in AT&T's standard customer agreement violates California law.

"AT&T prominently advertises particular flat monthly rates for its post-paid wireless service plans." But after customers sign up, the telco "covertly increases the actual price" by tacking on the "bogus so-called 'Administrative Fee," reads the lawsuit filed Thursday in US District Court for the Northern District of California.

The lawsuit seeks to recover "hundreds of millions of dollars" that AT&T has improperly collected over the years as well as an injunction directing AT&T to stop charging the fee.

In response to the lawsuit, AT&T argues the "lawsuit is wrong" and that the company has properly disclosed the fee to consumers.

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