Four of the country's biggest mobile phone networks are facing a major class action lawsuit which could see millions of Britons rewarded with up to £104 in compensation payouts.
Vodafone, EE, O2 and Three are under fire amid reports that loyal customers have been overcharged with the news of the lawsuit coincided with the Black Friday and Cyber Monday shopping events.
The said lawsuit is named the loyalty penalty claim with the claimants alleging the firms charged loyal customers for their mobile handsets over the initially agreed contractual term.
According to the lawsuit, up to 10.9 million phone contracts were overcharged by EE, O2, Three and Vodafone between October 1, 2015 through to March 31 of this year.
Mobile phone customers could claim £107 following a lawsuit
|GETTY
Claimants are seeking damages of up to £1.141billion and those affected by the alleged overpayment issue could be in line for up to £104 in compensation for each contract taking out with the operators.
It is understood that many customers believed to be affected by the allegations are planning to put forward claims against multiple operators.
All qualifying EE, Vodafone, Three and O2 customers will be automatically included in the claim for free unless they choose to opt out of the lawsuit.
Consumer rights expert Justin Gutmann brought forward the legal challenge which has now been approved to go trial by the Competition Appeal Tribunal.
VofanfoneThree have said they 'robustly defend this claim'
| PAThe challenge is being brought to the courts on behalf of consumers who bought contracts made up of a mobile phone and airtime services such as data, minutes and calls
Initially, the price for these contracts was agreed during on their minimum terms which included both the cost of the mobile device and use of airtime services.
Based on the claim's allegations, operators did not reduce the amount charged once the minimum contractual term expired despite customers already having paid for their devices.
As a result of this, current customers were charged more than what a new customers would have have been if they were just paying for airtime services.
On the case, Mr Gutman said: "For far too long the phone companies have been taking advantage of their loyal customers. That's why it's time to stop the immoral practice of loyalty penalties."
The consumer rights advocate originally wanted the claim to go back to contracts beginning in 2007, however the Competition Appeal Tribunal reduced the purview of the lawsuit to contacts taken out between October 2015 and March 2025.
An O2 spokesperson said: "At this early point in the proceedings, we welcome the Competition Appeal Tribunal's ruling that the majority of the claim has no basis to be brought, significantly reducing its scope.
"We maintain that there is no merit to Mr Gutmann's case for the remaining period and will continue to robustly defend our position as it proceeds."
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Mobile phone providers are under fire
| GETTY IMAGES | GBNAn EE spokesperson added: "We do not accept the substantive allegations of the claim. Our priority is, and always will be, to provide a great experience for our customers."
VodafoneThree said: "We are disappointed with the Tribunal’s decision to certify the claim. We will review the judgment in detail before considering next steps. We will continue to robustly defend this claim."
Earlier today, Ofgem confirmed fined Virgin Media £23.8million, after it disconnected telecare customers during its programme to migrate customers to digital landlines.
Ian Strawhorne, the regulator's director of Enforcement, said: "It’s unacceptable that vulnerable customers were put at direct risk of harm and left without appropriate support by Virgin Media, during what should have been a safe and straightforward upgrade to their landline services."