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Prison Phone Co. GTL Gets OK On $17M Price-Fix Deal

Law360.com, Oct. 30, 2024. https://www.law360.com/classaction/articles/225...

Prison phone company Global*Tel Link Corp will pay $17 million to escape claims that it colluded with two other companies to inflate the cost of calls made from inside U.S. prisons after a Maryland federal judge gave the deal her preliminary seal of approval Wednesday afternoon.

U.S. Circuit Judge Lydia K. Griggsby conducted the entire fairness hearing top to bottom in under 30 minutes, saying at the end that she was satisfied that the settlement was fair and that the proposed class — which could number in the tens of thousands — was good for preliminary certification.

In closing, she reminded the parties that there was still "quite a bit of work to be done in this case" to identify who all the class members are and figure out how to notify them, since the parties are not yet sure exactly how many people will fit the bill.

The class will comprise anyone who received a call from a loved one from a facility with phone service run by GTL during a certain period and paid for that call, since the provisionally certified class argues they paid an inflated rate.

Judge Griggsby said the parties and the court would have to have "a more fulsome conversation than normally happens in these cases" when it came to identifying and notifying potential class members, but that she was looking forward to it.

The litigation has been winding through her docket for more than four years. The class first laid their allegations in the summer of 2020, accusing mobile marketing company 3CI and inmate calling companies Securus and GTL of working together to hike up the price of collect calls made from prisons.

Largely centered around the companies' flat-rate pricing, the suit accuses the inmate calling companies of hatching a deal to avoid competition on that front by working with 3CI.

Securus was the first to come out with a flat-rate offer for collect calls in 2010, which cost roughly a dollar a minute for a 10- or 15-minute call, according to the suit, and 3CI was the marketing company it contracted with to help make the new flat-rate regime happen.

But GTL was hot on Securus' heels with a plan to implement its own single-call program and charge less than Securus, the suit says. But it also alleges that Securus was able to cut its competition off at the knees by obtaining a 3CI patent that covered technology used to charge recipients for single calls in late 2012.

That meant that 3CI could not provide services to GTL that were covered by the patent without Securus' permission and contract terms, according to the suit.

But the suit goes on to allege that Securus and 3CI reached an agreement where the latter company would solicit GTL's business under terms that would allow the company to market its single-call program at the same price as Securus while it also used 3CI for marketing and implementation.

And to justify the cost of the calls, the suit claims that Securus and GTL told consumers as well as the state and local governments contracting with them that much of the cost of the call went to 3CI in transaction fees. But that was not true, according to the proposed class, which claims less than half of the cost went to 3CI while GTL and Securus pocketed the rest.

The settlement the court signed off on Wednesday was only with GTL. Securus is currently trying to compel arbitration and 3GI settled earlier this year for $4.3 million.

The family members of prisoners and the proposed class are represented by Handley Farah & Anderson PLLC, Cohen Milstein Sellers & Toll PLLC, Justice Catalyst Law Inc., the Human Rights Defense Center and the Washington Lawyers' Committee for Civil Rights and Urban Affairs.

Global Tel*Link is represented by Arnold & Porter.

Securus is represented by Morgan Lewis & Bockius LLP.

3CI is represented by Williams & Connolly LLP.

The case is Albert et al. v. Global Tel*Link Corp. et al., case number 8:20-cv-01936, in the U.S. District Court for the District of Maryland.

 

 

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