CenturyLink is already facing numerous lawsuits after a whistleblower revealed the company was defrauding its own customers by over-billing users, using misleading fees to jack up the advertised price of service, and signing customers up for services they didn't want or didn't order -- just to meet sales quotas. Employees say the company repeatedly ignored whistleblower complaints to management about the practice, resulting in a lawsuit by Minnesota's Attorney General.
Now CenturyLink is facing yet another lawsuit
, this time by investors angry about CenturyLink's stock tanking in the wake of the news.
The investor class action argues that CenturyLink's stock value was already “artificially inflated” and that once the pricing and fraud scandal came to light, investors “suffered significant losses.”
Bondholder Inter-Marketing Group claims that CenturyLink failed to “disclose material adverse facts about the company’s business, operations, and compliance policies. "When news of the facts became public, the notes fell approximately 6 percent in one trading day," notes the group's lawyer. "We intend to pursue the action on behalf of the noteholders to recover their losses.”
A lawsuit by Minnesota Attorney General Lori Swanson resulted in suits from numerous additional states that are all now occurring simultaneously. CenturyLink has subsequently simplified its pricing in some areas in the wake of the lawsuits and ongoing customer defections, including eliminating the company's misleading "Internet Cost Recovery fee."
“I want [CenturyLink] to knock it off," Swanson said when the suit was filed. "It is not OK for a company to quote one price and then charge another for something as basic as cable television and internet service. We want an injunction so the company stops doing this to other people, and hopefully fixes the problem for these people as well."
Unfortunately for consumers, the behavior CenturyLink has been accused of is fairly standard practice across the entire industry, where a lack of competition means accountability is often hard to come by.