T-Mobile Accused of Destroying Evidence in Text Price-Fixing Case

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T-Mobile USA Inc. is being accused of tampering with evidence that could help plaintiffs involved in an antitrust class action lawsuit concerning an alleged collusion between wireless carriers to raise the prices of pay-per-use text messages.

In a motion filed Jan. 6, plaintiffs are seeking sanctions against T-Mobile for deleting emails from two key witnesses that reportedly admitted the company deliberately collaborated with AT&T, Sprint and Verizon to increase the prices of text messages starting in 2005. The motion also says T-Mobile failed to provide notebooks and other record-keeping documents which showed product prices from previous years, and the amount that it would cost for pay-per-use text messages.

Plaintiffs allege that T-Mobile broke its own document keeping policies by deleting these emails, which were sent between the company’s director of marketing, planning and analysis, Lisa Roddy, and its former vice president of services and pricing innovation, Adrian Hurditch. Between these two executives, the emails had reportedly proved the price collusion had been planned and implemented onto customers.

T-Mobile denied the existence of any such emails, and stated that the notebooks which had contained these records had become misplaced. The plaintiffs state that this deliberate tampering constitutes to bad faith, and that the company should face consequences on top of the initial charges, either by adverse inference jury instruction or an appropriate alternative.

The initial text message price-fixing class action lawsuit was filed in 2008, when several different cell phone companies, including T-Mobile, AT&T Mobility LLC, Verizon Wireless LLC and Sprint Corp, were sued for making unprecedented changes in their pricing structures of their text messaging plans. Allegedly, the companies conspired to increasing the prices of text messages for future, and even during current phone plans.

Reportedly, the company emails which contained the details of the new and increased prices of pay-per-use text messages had been intentionally deleted by the company on the same day the original class action lawsuit was filed. These allegations led to an investigation conducted by former Senator Herbery H. Kohl, due to the serious damage these actions inflicted on the case.

Additionally, several key notebooks had also gone missing soon after the motion was filed. These notebooks were kept by Roddy, and contained detailed accounts and activities of the company — and may have contained further evidence of the alleged price-fixing system.

Up until the plaintiffs filed a motion for the defendant to produce them, T-Mobile had claimed they had somehow become lost. After the motion was filed, some of the notebooks had “reappeared under a paralegal’s desk,” but the specific notebooks containing the possible price collusion evidence remain missing.

The alleged text message pricing conspiracy was supposedly started due to decreasing costs, which brought the four companies together to exchange price information and to increase their texting rates by at least one-third through a new pricing structure. The new prices prompted multiple class action lawsuits from plaintiffs across the country, which resulted in their consolidation into an MDL.

“Roddy and Hurditch were aware of the relevance of the email’s content … yet destroyed it in the breach of T-Mobile’s duty to preserve. The deletion of the Roddy-Hurditch email has harmed plaintiffs’ ability to add more detail to the smoking gun email chain in order to tilt the balance in favor of liability,” the motion said.

If found guilty of these allegations, T-Mobile will not only have to face the original charges brought against them in the original class action lawsuit, but they will also face additional charges constituting bad faith, and may face an adverse inference jury instruction.

The plaintiffs are represented by Marvin A. Miller of Miller Law LLC, while T-Mobile is represented by Davis Polk & Wardwell LLP and Schiff Hardin LLP.

The Text Message Price-Fixing Class Action Lawsuit MDL is In re: Text Messaging Antitrust Litigation, case number 1:08-cv-07082, in the United States District Court of Northern Illinois.