T-Mobile has come to an agreement with the New York State Attorney General’s Office over claims that the carrier did not honor price guarantees for T-Mobile One plans on its 4G network between January 2017 and April 2019. Those plans were advertised as being “Price Guarantee Plans.”
Affected active T-Mobile customers who leave the carrier will be able to collect a credit worth the last month’s payment and a $25 gift card.
Those who stay on and are still using an older phone can get a free 5G phone (worth up to $250) or credit up to $150 toward a more expensive 5G phone for lines that are still using 3G or 4G. Rates for their recurring monthly plans will stay the same until 2029.
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As part of the agreement, T-Mobile is also making a one-time payment to the Attorney General’s office in the amount of around $98,000.
According to a press release issued by New York Attorney General Letitia James, an investigation by the office found that T-Mobile raised rates on those plans in 2024 by approximately $5 per line, a change that affected approximately 252,957 plans at the time. It also pegs the relief to be worth around $38 million in value.
“T-Mobile misled hundreds of thousands of New Yorkers by promising that it would never raise prices on their cellphone plans, only to do exactly that just a few years later,” said James in the release. “Consumers shouldn’t have to pay the price for a misleading sale.”
The office’s filed agreement notes that T-Mobile made the price guarantee in at least two press releases and during a CNET video interview with then-CEO John Legere in 2017. In that video, Legere said, “We also extended the Un-contract to T-Mobile One Unlimited, which means we will never raise your rate; we guarantee.”
The agreement notes that T-Mobile ran afoul of a New York State law that requires companies to disclose terms “clearly and conspicuously,” and that any disclaimers about the price guarantee were ineffective by “directly contradict[ing] what a reasonable consumer would understand the Price Guarantee Offer to mean.”
It also states that “Respondent [T-Mobile] neither admits nor denies the OAG’s Findings” that detail the investigation’s conclusions.
When asked about the agreement, T-Mobile sent the following statement to CNET: “The $38 million cited in the press release is an estimate of potential benefits that a group of long-standing T-Mobile customers may choose to take advantage of, not the amount in refunds or payments. The agreement provides for approximately $98,000 paid to the state and a range of optional customer benefits. We’re glad to have this matter resolved and remain focused on delivering value to our customers.”
Per the agreement, T-Mobile has 150 days starting Oct. 20 to identify and notify customers who are eligible for the relief. After they’ve been notified, customers will have 45 days to decide whether to cancel their T-Mobile account (getting the last month’s payment and a $25 cash card) or continue as a customer (getting a free or discounted 5G-capable phone for each affected line or the $150 credit toward a new phone). For the latter, T-Mobile will also not charge any costs such as transfer or activation fees.