$200M class action suit against Bell’s prepaid service has been dismissed

A $200M class action suit alleging Bell’s prepaid card system is unlawful was dismissed by the Ontario Court of Appeals on April 4.

The suit was launched in 2012 by Celia Sankar, who was supported by a million Bell, Virgin Mobile and Solo prepaid customers who lost their prepaid balance after failing to top up within the allotted period.

The suit was prompted by Sankar losing $58 in credit one day after her expiry date. Bell has since changed its policy to include a seven-day buffer period in conformance with CRTC regulations that went in to effect late 2013. The case brought forward by Sankar argued that Bell took her funds too quickly, or that the company’s prepaid card model operated improperly according to Ontario’s gift card law, which disallows gift card expiration dates.

In January 2015, Ontario’s Superior Court of Justice ruled that Bell had not breached the terms of its top-up agreement, and that prepaid cards were not gift cards and as such did not have to abide by the same regulations. An appeal was filed that March.

This week’s ruling to dismiss the appeal was sympathetic, stating that customers “may also find themselves on a merry-go-round they cannot get off, because they must constantly top up an account with a credit balance, because they have not used up all their credits from the previous active period.”

It concluded, however, that is simply the price that must be paid for the flexibility of prepaid service. On the class action suit’s website, the class states that it will be, “reviewing the decision to determine whether to seek leave to appeal to the Supreme Court of Canada.”

Bell’s model for prepaid cards is the same as Rogers and Telus. Prepaid customers pay for an active phone number by purchasing cards in various denominations. The lower the amount, the less time it will buy to keep your phone active. For example, a $10 card at Telus will keep your service active for 30 days, while a $100 card will keep your service active for a full year. That is, of course, unless you use all your credit up first on pay-per-use calls, text or data.

If you fail to top up your account seven days after expiration, you will lose the particular number assigned to the phone, as well as any remaining credit. For some, especially those who use the yearly card deal as a way to maintain an emergency phone, that credit can rack up quickly. It remains, however, the most inexpensive way to keep an active number with Canadian wireless carriers.

Related reading: Bell ups data overage rate, overhauls plan names

[source]Ontario Courts[/source]