Cellphone Termination Fee Cases

Sprint (defendant) charged customers early termination fees (ETFs) for ending contracts before their term expired, which plaintiffs alleged were unlawful liquidated damages under California's Civil Code; Sprint argued the ETFs were part of the bundled price for handsets and service, necessary to offset discounted long-term rates, and that its actual damages from early termination exceeded the fees charged, while also arguing the ETF was merely an "alternative performance" option customers could choose rather than a damages provision at all. A jury found for the plaintiffs and assessed substantial actual damages, and after post-trial proceedings involving a disputed offset calculation, the trial court ordered restitution and enjoined further ETF collection; Sprint appealed.