Junk Fees
‘Altice, which is a French company, uses Fairfield County, Litchfield County and all their customers as the ATM machine to send money back to their foreign company,’ said a state lawmaker.
From left: Senate Majority Leader Bob Duff, D-Norwalk, and Connecticut Attorney General William Tong at a press conference Monday in Hartford.
May 13, 2024 – The state of Connecticut is suing Altice USA over a $6 monthly Internet fee that could cost the company tens of millions of dollars in state fines and customer restitution. The suit also challenges the lawfulness of some Altice advertising practices.
Connecticut Attorney General William Tong said the case is challenging Altice’s maintenance of a Network Enhancement Fee (NEF), which has climbed to $6.00 per month, per subscriber since starting out at $2.50 five years ago on the bills of Internet customers in Fairfield, Litchfield and New Haven counties.
The suit asserts that the NEF involves deceptive advertising and billing practices in violation of a state consumer protection law.
“This Network Enhancement Fee is not a tax, not a federally or state-mandated fee. It’s not some climate-related thing. It’s just an extra charge that Altice is slipping in on the bill to take money from all of us. That’s all it is. Straight up,” Tong said Monday at a press conference in Hartford.
Tong – who said he is an Altice customer and a “victim” – claimed that the NEF represents a fee that customers have to pay because Altice – which provides broadband under the Optimum brand – is a monopoly.
“Those are monopoly rents. That’s why we are forced to pay them. They are wrong and they’ve got to pay the money back,” Tong said.
Tong told reporters that the NEF yielded “tens of millions of dollars … over and above the monthly Internet service charge” and the state is trying to get it all back.
At the press conference, Tong was joined by state Senate Majority Leader Bob Duff, D-Norwalk.
“Frankly, Altice, which is a French company, uses Fairfield County, Litchfield County and all their customers as the ATM machine to send money back to their foreign company. We are getting nothing in return for all of these fees that we pay,” Duff said.
Altice, based in Long Island City, N.Y., and is a publicly traded company on the New York Stock Exchange. According to the company’s most recent annual report, the company is controlled by Patrick Drahi, a French-Israeli billionaire.
Altice issued a statement saying in part: “We remain proud to serve our Connecticut customers and communities and believe that the Attorney General’s lawsuit is without merit.”
Fairfield, Litchfield and New Haven counties have about 2 million residents combined. On its website, Altice says is serves 400,000 Connecticut homes and businesses.
Tong’s suit said that Altice’s NEF violated the Connecticut Unfair Trade Practices Act, adding that the state is seeking an injunction and demanding payment of restitution going back to 2019.
Tong’s suit said the NEF violated state law because Altice “misrepresented the nature and purpose of the NEF” by listing it under “Equipment and Extras,” giving the impression it was an optional charge. Tong said that by adding the NEF to bills, Altice was able to advertise an artificially low price for Internet service.
“The NEF is thus nothing more than a hidden ‘junk fee,” the lawsuit said. “Altice’s acts and practices, as described herein, are oppressive, unethical, immoral, and unscrupulous.”
Altice defended the NEF saying it was used to maintain the network, but Tong told reporters, “They’re supposed to do that anyway.”
Tong is also suing over Altice advertising on TV that promoted Internet speeds that could not be met over Wi-Fi networks. The suit said Altice mentioned the speed issue in disclaimers that were presented in formats “nearly impossible to read and appeared on the screen only for fleeting moments.”
The suit also targets Altice ads distributed in Spanish but included corporate disclaimers in English when state law required Spanish.
Some key portions of the suit released to the public were redacted, such as the exact mount of revenue the NEF generated.
“The company has argued that information is confidential. We anticipate arguing for that information to be unsealed at a future court hearing,” Elizabeth Benton, Chief of Communications and Policy in Tong’s office, said in an email.
If Connecticut prevails in state court, “as to potential recovery, the complaint seeks restitution for consumers as well as penalties paid to the state,” Benton said.
This story was updated at 6:40 p.m on May 13, 2024 to include more context to Altice’s ownership structure.
