Class action lawsuit filed against Riverside, Los Angeles, San Bernardino and Orange counties

On a quiet Thursday afternoon in the Norco suburbs, a cell phone rumbles to life on a dining room table in the humble home of Lou and Dana Kaelin. The voice on the line is that of their son, Todd.

“Hey Toddy!” shouts Dana, jubilant, as she answers.

This call, like hundreds of others, comes from the Banning jail, where Todd Kaelin is serving a 9-year sentence for drug convictions. He phones his parents two to three times a week, and the calls are his best link to the outside world. When prison life is at its bleakest, a voice on the phone gives him hope.

But the calls cost money too, and the Kaelins insist the price is far too high. Each year, they spends hundreds of dollars to stay in touch with their son. The Kaelins claim that phone companies have gouged them with high rates and frivolous fees for years, and the county government does not care because it gets a cut of the jail calls' profits.

“They do it because they can get away with it, and it’s a good way to make money,” said Lou Kaelin, 71, a retired phone company technician. “That’s the only purpose for it. These people are making money off of us.”

The Kaelins are plaintiffs in a class action lawsuit that challenges the cost of jail calls in four Southern California counties – Riverside, San Bernardino, Orange and Los Angeles – and will soon add a fifth, Ventura. In each of these counties, plaintiffs claim that phone companies are paying local governments to turn a blind eye to unjustifiable call prices in county jails. Counties control the jail call contracts, and they could slash the cost of calls if they were willing to forego millions in revenue. Instead, the cost stays high, and the brunt of that expense falls to the friends and family of inmates, like Lou and Dana Kaelin.

“It doesn’t smell right,” said attorney Scott Rapkin, who represents the Kaelins in the lawsuit. “These counties are literally making millions of dollars off of predominately African American and Latino families, who are low income, and many people with disabilities. We can expect that from a corporation, but for a county to allow it to go on – especially in light of overwhelming evidence that staying in contact with loved ones is critical to recidivism rates – makes this really unconscionable.”

The class-action lawsuit was filed in federal court at a time when momentum is swinging towards jail call reform. California and several other states have lowered call costs in their prisons by barring prisons from accepting payments from phone companies. The Federal Communications Commission has ordered county jails to cap rates and reduce fees by June.

But the lawsuit seeks to go farther. If successful, millions will be refunded to families who have emptied their wallets to pay for jail calls, and phone companies will no longer be allowed to pay counties to get exclusive contracts. Companies call these payments “commissions,” but critics refer to them by a different name – “kickbacks.”

“It’s graft,” Lou Kaelin said. “Any time a private enterprise pays a government to work for them, its bribery. That’s the definition of bribery.”

Regardless of what you call it, it's the status quo in Riverside County.

For years, Riverside County’s jail calls were handled by Global Tel*Link, or GTL, the nation’s largest prison phone company. GTL charged about 10 cents per minute for a majority of jailhouse calls, but made most of its money in “connection charges,” which lumped a $2 fee on the front of every call.

In return for this exclusive contract, GTL paid the county at least $2 million a year. The deal stood from 2008 until last July, when another company offered to pay even more.

Securus, the nation’s second-largest prison phone company, upended GTL by offering to pay $2.5 million per year for an exclusive contract of its own. County leaders approved the deal, claiming it would provide inmate phone services at the “lowest possible cost.” In reality, the Securus contract raised the per-minute cost of inmate calls, and introduced a slew of fees. Jail calls remained far more expensive than everyday, non-jail phone calls.

Riverside County’s contracts with GTL and Securus are “egregious, but normal” in the prison phone industry, which is worth "billions," said Carrie Wilkinson, an expert at theHuman Rights Defense Center, an inmate advocacy nonprofit that is not involved with the class-action lawsuit.

The companies and the counties always make money, Wilkinson said, but everything else is negotiable.

“When these contracts are negotiated, nobody speaks for the prisoners or their families, seeking to get them the best service at the lowest price,” Wilkinson said. “The only people who are negotiating were the ones who stand to make money.”

Despite the debate over the cost of jailhouse calls, no answers came from Securus or the Riverside County officials who are responsible for the jail phone system.

The Riverside County Sheriff’s Department, which runs the jails and spends the millions paid by Securus, refused to be interviewed for this story, insisting it would be “inappropriate” to comment on the jailhouse calls because of the class-action lawsuit. The department wouldn’t discuss the basics of the phone system, despite the fact that it is in use at public facilities every day.

A similar silence came from the county’s Board of Supervisors, which approved the Securus contract with no debate or discussion in July. All five members of the board either declined to be interviewed or did not respond to multiple requests for comment. Ray Smith, a county spokesman, said the county attorney told the supervisors to stay mute on the topic because of the lawsuit.

Securus ignored multiple requests for comment.

Riverside County deposits the millions it collects from Securus into the Inmate Welfare Fund, a special account set aside to benefit jailhouse programs. This money is primarily used for programs that benefit inmates, like the jailhouse library or addiction treatment, but can also be used for jail maintenance.

Rapkin, the attorney in the class action lawsuit, said his clients support the inmate welfare programs, but do not believe they should be funded by jail calls, shunting the cost onto inmates' friends and families.

Everyone has a stake in inmate rehabilitation, so everyone should help pay for it, Rapkin said.

“With a $1 dollar tax on every citizen, they could raise the same amount of money instead of putting it all on the backs of these families,” Rapkin said. “That’s what makes this so crazy. It would be just a buck or two.”

The class-action lawsuit is built on a similar argument, which makes it unique from other suits that have challenged jail call prices in other states. Rapkin and other attorneys claim that many of the phone charges levied on inmate families are technically a local tax, and that phone companies are simply a middle man that collect money and pass it on to county governments. The California Constitution establishes a very broad definition of taxes – basically, any money collected for a specific government function – and requires all local taxes to be approved by voters. Jail call prices have never been approved by Riverside County voters, so if the lawsuit can prove these fees are a tax, the charges will be illegal. This precedent would likely impact all California counties, even if they were not part of the suit.

In Riverside, most of Securus’ profit comes from deposit fees, which are collected through an automated online account system. If you want to stay in contact with an inmate, you must create an account and deposit money. Funds are automatically withdrawn each time you receive a call, and when the balance dwindles, another deposit is necessary.

Most deposits are made online, and Securus applies a $7.95 “convenience” fee each time an online deposit is made.

The company describes the fee as “up to $7.95,” but during tests by The Desert Sun, the fee was always the maximum amount, no matter how much money was deposited. (At one point, Securus attempted to charge a reporter $7.95 to deposit a single cent.)

That fee might seem high, but if you don’t have an Internet connection, it is even higher.

Securus charges up to $9.95 to deposit money by phone, $10.99 to deposit a MoneyGram and $11.95 to deposit by Western Union. The only way to avoid fees is to mail a check.

The fees don’t end there either.

If a friend or family member wants to receive jailhouse calls on a cellphone, instead of a landline, there is an additional fee of $3.99 per month. If relatives accept any out-of-state calls, Securus tacks on an additional 5 percent fee, plus another $3.49 per month. If an inmate leaves you a voicemail, that’s another $1.95.

Finally, a 4 percent “location validation fee” is added to all jailhouse calls. Securus tracks the location of anyone who receives an inmate call, then bills the recipient to offset the cost of tracking.

All of these fees are added to the cost of the actual phone calls. Pre-paid local calls cost 14 cents per minute. Interstate calls are 20 cents per minute. International calls range from 25 cents to 54 cents per minute.

Soon, however, that could all change. The FCC order that takes effect this summer will cap the price of nearly most jailhouse calls at 16 cents per minute. Deposit fees will be limited at $3 for online service and $6 for phone service. All other fees will be forbidden.

Phone companies are expected to challenge the FCC order in court, but if the order stands, Securus will be forced to re-write its prices in local jails.

It is unclear what will happen to the money the company has promised to Riverside County. Based on its current contract, Securus has guaranteed the county at least $12.5 million over the next five years, but now that money could be jeopardized.

“My guess is that they don’t have a plan,” said Rapkin, the Kaelins’ attorney. “None of these counties do. They never expected this was going to happen.”

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