Hall v. Sprint Spectrum L.P.

876 N.E.2d 1036 (2007)

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Nature of the Case

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Facts

P entered into a cell phone service contract with D. P agreed to be bound to a one-year contract and to pay a $150 early termination fee if she did not remain a customer for a full year. P's account included two cell phone numbers. D’s contract contained a choice-of-law provision selecting Kansas law, the state of D’s incorporation. In October 2003, D discontinued P's service for nonpayment. P called to cancel her contract. D refused unless she paid the remaining balance on her account plus the early termination fee. P paid, under protest, the entire amount ($415.61) D claimed she owed on one of her two cell phone numbers, including the early termination fee. P also wanted to cancel her second cell phone number but could not afford to pay the early termination fee. D refused to cancel the account and stop the accrual of charges unless P paid the early termination fee for the second cell phone number. P never paid the early termination fee for the second cell phone number. D wrote off the second account for nonpayment. P filed a class action complaint alleging four causes of action: (1) breach of contract, (2) statutory fraud, (3) unjust enrichment, and (4) relief from unlawful penalties. P claimed that early termination fees are unlawful penalties. P brought her original class action complaint under Illinois's Consumer Fraud and Deceptive Business Practices Act. P filed a motion for class certification. The court granted the motion certifying a 48-state class action. In the order, the trial court directed the parties to submit a formal proposed order. In her first amended complaint, P alleged that D placed the following express choice-of-law provision in all of its contracts: 'This Agreement is governed by and must be construed under federal law and the laws of the State of Kansas, without regard to choice[-]of[-]law principles.' P’s first amended complaint alleged that Kansas common law should be applied nationally and the Kansas Consumer Protection Act should be applied nationally or that the Illinois Consumer Fraud Act should be applied and the consumer fraud acts of the other 47 states should be applied to residents of those states. D filed a motion to reconsider the trial court's order for class certification. The trial court denied D's motion to reconsider. The trial court entered a formal, written order, certifying the 48-state class and D eventually filed a petition for leave to appeal to the Illinois Supreme Court. The Illinois Supreme Court denied D's petition for leave to appeal but issued a supervisory order, ordering the appeals court to grant D's petition for leave to appeal.