AT&T drops legal fight over Mass. man's $1M bill

[tmobiley]

IPSWICH, Mass. — AT&T Inc. says it's dropping its legal fight against a Massachusetts businessman whose company was on the hook for a fraudulent million-dollar phone bill.

The telecommunications company said in a statement Monday it is no longer pursuing its claims against Michael Smith of Ipswich, "though we are entitled by law to collect the amounts owed."

Smith said the offer depends on his dropping a countersuit. He'll meet with his attorney about it on Tuesday.

Smith says someone hacked into his small manufacturing company's phone system in 2009 and made nearly $900,000 in calls to Somalia. AT&T sued Smith for $1.15 million to recover the cost of the calls plus interest.

Smith told The Salem News (http://bit.ly/LBXNqG ) he repeatedly asked AT&T to write off the bill. He said paying it could force his business to close.

[Morphling27]

What does ATT feel this will accomplish? They clearly state in the story they don't want any harm to come to their name and brand, but this being plastered all over will surely do little to help there already not so great image.

I don't get how if you even stayed connected every minute of those 4 days that ANY phone call in this world would be close to $1,000,000. That's absurd - even ATT knows it. I get that ATT cites things saying it's the phone number owner's responsibility even if they didn't make the call but when did we get away from justice showing that a specific person actually comitted the crime. This was the same BS we saw the media companies pull with downloading illegal files.

[spdickey]

AT&T saves a bizillion in court and lawyer fees.

[efparri]

It would appear that this is related to AT&T Corporation, the long distance carrier and not AT&T Mobility, the wireless carrier.

[spdickey]

The entity called the "AT&T Corporation" is today just the long distance subsidiary operated by AT&T Inc. It is probably not the unit billing the customer. That would be the local voice provider operated by AT&T Inc. The former American Telephone and Telegraphy Corporation is no longer after the acquisitions and divestitures of the past 30 years.

There is an "AT&T Inc." which owns and operates AT&T Mobility, the wireless carrier, and also operates "the leading U.S. provider of local and long distance voice services," under various companies, including "AT&T Midwest, AT&T West, AT&T East, AT&T Southeast and AT&T Legacy" among others, all under the AT&T brand. Which landline services apparently AT&T wants to dump in favor of wireless services.

Its all headed up by the beloved Randall Stephenson, Chairman and CEO.

Its easy to think one is the same as the other since they all fall under the same corporate umbrella.

See http://en.wikipedia.org/wiki/AT%26T_Corporation

[quagmire]

The entity called the "AT&T Corporation" is today just the long distance subsidiary operated by AT&T Inc. It is probably not the unit billing the customer.

According to what I've read and heard (lots of local coverage here in the Boston area) AT&T Long Distance is the unit billing the customer. The victim is a Verizon landline customer. When their PBX was hacked, Verizon forgave the $200K+ of phone calls, and disabled their international calling. Unfortunately, they didn't disable their "10-10 dial-around" (aka Feature Group D) service, so the criminals were still able to get access to AT&T long distance service.

In other words, this has nothing to do with AT&T Mobility.

[efparri]

The only local service in New England operated by AT&T is in Connecticut. The article stated that the local carrier is Verizon. The thieves used a dial around code of "10288" to reach AT&T instead of the long distance carrier selected by the victimized company. The service in Somalia was set up to share in the toll charges collected.

[spdickey]

Verizon as the local CLEC could be the ones who may have bill the customer on behalf of AT&T Long Distance.

Nice that AT&T decided to drop their lawsuit. Apparently the felt it was too costly to proceed for some reason.

But the poor business man is out $30 grand in legal costs so far fighting AT&T. So he is continuing his counter-suit against the corporate giant alleging abuse of the court process and violation of consumer protection laws.

But AT&T said they won't drop their suit unless the customer drops his.

http://www.salemnews.com/local/x1501...l-with-a-catch

AT&T, Rethink Possible.

[jet1000]

IPSWICH, Mass. — AT&T Inc. says it's dropping its legal fight against a Massachusetts businessman whose company was on the hook for a fraudulent million-dollar phone bill.

Of course. This is another unselfish act of benevolence by AT&T. AT&T has realized that this man's business is so poorly run that he has no money with which to pay for the calls that he is responsible for. Upon realizing this, AT&T has no choice but to write off the money owed and take the accompanying tax break.

One would hope that Mr. Smith would be wise enough to accept their generous offer by dropping his countersuit and absorbing the $30,000 in legal fees that he incurred. Unfortunately, AT&T's loss is much higher due directly to Mr. Smith's incompetence in regards to his phone system. It's a sad state when one won't take responsibility for one's actions. In this case, this could have all been avoided if he had blocked international calling from his business lines from the beginning.

[spdickey]

Of course. This is another unselfish act of benevolence by AT&T. AT&T has realized that this man's business is so poorly run that he has no money with which to pay for the calls that he is responsible for. Upon realizing this, AT&T has no choice but to write off the money owed and take the accompanying tax break.

One would hope that Mr. Smith would be wise enough to accept their generous offer by dropping his countersuit and absorbing the $30,000 in legal fees that he incurred. Unfortunately, AT&T's loss is much higher due directly to Mr. Smith's incompetence in regards to his phone system. It's a sad state when one won't take responsibility for one's actions. In this case, this could have all been avoided if he had blocked international calling from his business lines from the beginning.

Perhaps you didn't read the part when his local carrier (Verizon) immediately saw the problem without prompting by the customer, blocked international calling on their side and refunded the fraudulent long distance charges. However Verizon left a hole which was exploited by the crooks, by still allowing 10-10 dialing. The businessman was hardly incompetent, you might want to point your finger at the incompetence of the CLEC. Or you probably did read that part, but just failed to recognize it in some misguided zeal to paint AT&T in a good light.

AT&T, on the other hand, filed suit in court, which cost this poor businessman over $30,000 in legal fees. AT&T only dropped it suit not because it is ":unselfish" or because of any "benevolence" but rather because the case became public and AT&T is now trying to appear "kind." If it was truly benevolent it would settle with the customer, and pay for his legal fees due to its malicious filing of their lawsuit, their "abuse of the court process and violation of consumer protection laws."

I applaud the businessman for continuing his counter suit against AT&T and wish him well.

[Steveanderson13]

I knew someone would say it better than me.

[jet1000]

However Verizon left a hole which was exploited by the crooks, by still allowing 10-10 dialing.

The 10-10 dial around was mandated by the FCC and whenever AT&T receives a request to place a call via 10-10 it is required to provide it by law. However, AT&T is not required to provide it for free. AT&T provided the service and has every legal right to demand payment.

The businessman was hardly incompetent,

Of course he was. Blocking international calls for employees and anyone else accessing the system is his responsibility. That's Business 101. He failed to do it and was legally responsible for the calls. AT&T could have forced liquidation of his assets to satisfy his obligations.

AT&T, on the other hand, filed suit in court, which cost this poor businessman over $30,000 in legal fees.

His incompetence cost him those legal fees. I agree that he is a poor businessman to create such a situation for himself.

due to its malicious filing of their lawsuit

Nothing malicious about it. Mr. Smith entered into a legal agreement to pay AT&T for any calls made. He failed to live up to his obligation, thus requiring AT&T to take legal action to get properly paid for the services they provided. AT&T lost money because they had to pay another carrier completing the call and did not receive any reimbursement.

I applaud the businessman for continuing his counter suit against AT&T and wish him well.

It's interesting to see how you would applaud such irresponsibility. I did not see where the businessman decided to continue his countersuit. But if he did, it is likely AT&T will continue to press forward for the liquidation of Mr. Smith's assets. As I said earlier, he'd be wise to drop his countersuit and be happy he got away with only $30,000 in losses.

[awj223]

The 10-10 dial around was mandated by the FCC and whenever AT&T receives a request to place a call via 10-10 it is required to provide it by law. However, AT&T is not required to provide it for free. AT&T provided the service and has every legal right to demand payment.

Verizon actually MONITORED activity on the line, and cut off service when it was clear that there was fraudulent activity. AT&T couldn't do the same because...?

Of course he was. Blocking international calls for employees and anyone else accessing the system is his responsibility. That's Business 101. He failed to do it and was legally responsible for the calls. AT&T could have forced liquidation of his assets to satisfy his obligations.

What kind of idiotic talk is this? Businesses have reasons to make international calls, you know. If my company cut off international calling on our lines, I wouldn't be able to do my job.

His incompetence cost him those legal fees. I agree that he is a poor businessman to create such a situation for himself.

AT&T's incompetence cost them $800k in phone calls, unless they can recover the revenue from Somalia. VZ limited its losses to $200k by monitoring the line. AT&T was stupid enough to let it continue unabated.

Nothing malicious about it. Mr. Smith entered into a legal agreement to pay AT&T for any calls made. He failed to live up to his obligation, thus requiring AT&T to take legal action to get properly paid for the services they provided. AT&T lost money because they had to pay another carrier completing the call and did not receive any reimbursement.

See above. AT&T lost probably 5x more money than it had to, because it FAILED to monitor activity on the line. And by the way, if the line actually gets HACKED, it's not the customer's fault. Perhaps AT&T should sue VZ for allowing the line to be hacked. Actually now that I think about it, VZ should have killed the 10-10 service, once it realized that the line had been hacked. Or it should have just gone ahead and taken that line out of service completely.

It's interesting to see how you would applaud such irresponsibility. I did not see where the businessman decided to continue his countersuit. But if he did, it is likely AT&T will continue to press forward for the liquidation of Mr. Smith's assets. As I said earlier, he'd be wise to drop his countersuit and be happy he got away with only $30,000 in losses.

If you ever own a small business, sir, I'd like to see it get sued into oblivion over an issue as stupid as this. One of the few times I'd ever root for a big company to take down a small one that really hasn't done anything wrong.

[spdickey]

The 10-10 dial around was mandated by the FCC and whenever AT&T receives a request to place a call via 10-10 it is required to provide it by law. However, AT&T is not required to provide it for free. AT&T provided the service and has every legal right to demand payment.

Of course he was. Blocking international calls for employees and anyone else accessing the system is his responsibility. That's Business 101. He failed to do it and was legally responsible for the calls. AT&T could have forced liquidation of his assets to satisfy his obligations.

His incompetence cost him those legal fees. I agree that he is a poor businessman to create such a situation for himself.

Nothing malicious about it. Mr. Smith entered into a legal agreement to pay AT&T for any calls made. He failed to live up to his obligation, thus requiring AT&T to take legal action to get properly paid for the services they provided. AT&T lost money because they had to pay another carrier completing the call and did not receive any reimbursement.

It's interesting to see how you would applaud such irresponsibility. I did not see where the businessman decided to continue his countersuit. But if he did, it is likely AT&T will continue to press forward for the liquidation of Mr. Smith's assets. As I said earlier, he'd be wise to drop his countersuit and be happy he got away with only $30,000 in losses.

Verizon blocked international calls, yet left the loophole open for 10-10 dialing.

AT&T has admitted the calls were fraudulent “This is the crazy part,” he (the owner) said. “AT&T is not arguing over whether these calls were fraudulent. There’s no dispute there.”

AT&T is showing a real lack of "unselfish acts of benevolence" if in fact as the result of Smith’s interview with the Salem newspaper comes at additional risk: AT&T’s lawyers threatened they would take action if he “disparaged” the company’s name in the media.

Don't you think its a fraud when AT&T charges $22 a minute for the calls to Somalia? Apparently AT&T is participating in some kind of collusion with someone in Somalia with these rates alone.

AT&T should pay the legal fees of its customer after its alleged malicious use of the court system.

[zephxiii]

AT&T couldn't do the same because...?

Because they don't have to. You shouldn't expect anyone to look out for you.