Out-Law News 1 min. read

Gateway sued in US over free internet access claims


Computer maker Gateway, Inc. has been accused of misleading its US customers by offering “free” internet access without revealing that many subscribers would be charged long-distance telephone rates, according to a class action lawsuit filed yesterday.
The complaint charges that Gateway violated the California Consumer Legal Remedies Act and the California statute prohibiting fraudulent and unfair business practices and false and misleading advertising. In addition to these statutory causes of action, the complaint, which also refers to a misleading credit card offer by Gateway, alleges that the company violated the California common law pertaining to fraud and deceit, negligent misrepresentation, and intentional infliction of emotional distress. The action is pending in the Superior Court of the State of California, County of San Diego.

The complaint alleges that Gateway untruthfully advertised that certain of its product packages included free internet access for the first year. The offer was deceptive and fraudulent, the complaint alleges, because Gateway did not reveal that thousands of people would be charged long-distance connection fees under Gateway's purported “free” internet access plan because Gateway did not provide local-access numbers. The complaint alleges that these customers were deprived of the “free” Internet access advertised and offered by Gateway, and subscribed at their own expense with an ISP, unwittingly paid long distance charges, or refrained from accessing the internet.

The lawsuit seeks to stop Gateway from continuing its allegedly deceptive practices and to order that it gives up its allegedly ill-gotten gains, in addition to the award of monetary compensation to class members for injuries suffered as a result of Gateway's alleged wrongdoing.

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