A company that provides phone service to prison inmates has lost its bid to dismiss a putative class action over its rates in Newark federal court, but the case has been stayed while the plaintiffs pursue an administrative remedy with the Federal Communications Commission.
Nevertheless, the judge has allowed the plaintiffs to proceed with limited discovery in the case.
As reported by the New Jersey Law Journal:
Global Tel-Link of Reston, Va., buys phone time for three-tenths of a cent per minute but resells it for 30 cents per minute to people who receive calls from inmates, according to the suit. The company is the exclusive provider of phone service for state prison inmates in New Jersey and the state’s 40 percent cut of those phone fees comes to more than $4 million per year, the suit says. Two affiliates of that company, Inmate Telephone Service and DSI-ITI, which provide similar services to county jail inmates in New Jersey, are also named as defendants.
The suit, filed in August 2013, brings claims under the New Jersey Consumer Fraud Act and the Federal Communications Act, as well as the takings clause of the Fifth Amendment. In November 2013, the FCC issued regulations capping rates for inmate calling services at 21 cents per minute.
Global Tel-Link and other prison phone service companies challenged the new FCC regulations and that case is pending in the U.S. Court of Appeals for the D.C. Circuit. In light of that case, Global Tel-Link moved for dismissal of the New Jersey suit, arguing that the FCC has primary jurisdiction to decide if the company’s terms are reasonable. The plaintiffs, for their part, said there was no need to refer the case to the FCC because that agency had already resolved the issue of whether the company’s rates are unreasonable.
In a Sept. 8 ruling, U.S. District Judge William Martini of the District of New Jersey agreed that the FCC has primary jurisdiction over certain issues in the case, but he entered a stay rather than dismissing it.
The suit was brought by a formerly incarcerated person and family members, who allege having to make minimum deposits of $25 without any written contract of knowledge of the terms related to their accounts.
Read more: http://www.njlawjournal.com/id=1202669450152/Judge-Wont-Toss-Class-Action-Over-Cost-of-Prisoners-Calls#ixzz3CtSaIAVH