Landmark Class Action Sets Standard for Telecommunications Advertising in Mexico
The Procuraduría Federal del Consumidor (PROFECO), Mexico's consumer protection agency, has won a class action lawsuit against a major mobile telecommunications operator for undue charges, changing rates without informing customers, and continuing to charge clients for services that had been canceled during 2012, 2013 and 2014. The claim was originally brought against a former operator that was acquired by the major mobile operator.
At the time, the former operator marketed 4G services on its website that were branded as "Radio Evolution," but such services that were provided to the customers were found to be inferior to what was advertised, including the use of abusive and false advertising to prompt consumers into mistakenly acquiring such services.
The penalty imposed by the consumer watchdog is final. The mobile company has been ordered to pay damages to affected end-users, plus 20 percent compensation at 9 percent annual interest.
The decision is of paramount importance, as it sets an important precedent to mobile operators with respect to the advertising of telecommunications services.
Holland & Knight attorneys have extensive experience in telecommunications and consumer protection matters in a variety of industries. For more information, contact the authors or Holland & Knight's Mexico City office.
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