Telecom Sues Optus Dealer for Contempt of Court Over Mobile Phone Misrepresentation

Telecom Australia has taken action against Optus Communications mobile phone dealer Let's Talk Communications, alleging that the company misrepresented the cost of its MobileNet mobile phone service to lure customers away. The Federal Court filing is the latest development in a heated $1.5 billion mobile phone industry battle. Let's Talk's actions are said to have breached undertakings made to the court in June, sparking concern about the legitimacy of mobile phone marketing practices.

Key Takeaways:

• Telecom claims that Let's Talk Communications breached its undertaking to the court by misrepresenting the cost of Telecom's MobileNet mobile phone service to potential customers.
• Let's Talk's actions allegedly took place in Western Australia and South Australia between June 15 and 19, where salesmen told witnesses that MobileNet charged different rates for local and long-distance calls.
• The misrepresentation is alleged to have occurred through a series of statements made by Let's Talk salesmen, including claims that MobileNet charged 29 cents for the first half-minute and 19 cents for subsequent half-minutes of local peak calls.
• The breaches are said to have taken place in spite of an undertaking made by Let's Talk to the court on June 1, where the company promised to ensure that its marketing practices did not mislead potential customers.
• The matter has been adjourned until next week by Mr Justice von Doussa after a brief hearing.
• Optus has denied any wrongdoing and claimed that Let's Talk has introduced procedures to ensure that it does not breach its undertakings.

Statistics:

• $1.5 billion: The current value of the mobile phone industry in Australia.
• $50: The amount paid to churn houses for each customer they successfully switch between Telecom and Optus.
• 29 cents: The alleged rate charged by MobileNet for the first half-minute of local peak calls according to Let's Talk.
• 19 cents: The alleged rate charged by MobileNet for subsequent half-minutes of local peak calls according to Let's Talk.
• 40 cents: The alleged rate charged by MobileNet for the first half-minute of a long-distance, off-peak call.
• 30 cents: The alleged rate charged by MobileNet for each subsequent half-minute of a long-distance, off-peak call.

Sources:

• The Sydney Morning Herald
• AAP Factbox
• The Australian