[the australian] A BID to bring a consumer class action suit against Vodafone Hutchison Australia over the performance of its mobile network has proceeded apace with more litigants joining the proposed action.
Law firm Piper Alderman, which is preparing a proposal for the suit, confirmed that the number of claimants had grown by a thousand to 23,000 since April and that efforts to raise money to fund the litigation had progressed.
The law firm said it was continuing its investigation of complaints by litigants which includes a mix of individual consumers, small businesses and companies. Piper Alderman litigation partner Sasha Ivanstoff said that once the investigation was complete and funding arrangements were secured, the company would prepare a statement of claim to be lodged in the Federal Court under trade practice and consumer protection laws. Mr Ivanstoff said he was not at liberty to discuss the details of the funding proposal.
The suit would contain allegations that VHA subsidiary Vodafone Australia Pty Ltd has made false claims about the capacity and coverage of its 3G network over a period stretching as far back as 2007.
Its parent company, VHA, may also be directly named as a respondent in the claim if Piper Alderman investigators assembled sufficient evidence it also misled customers, Mr Ivanstoff said.
The claim may eventually extend to associated telecommunications services such as voicemail, data and email.
Vodafone was yesterday hesitant to comment on the lawsuit in detail.
"We are aware of a law firm that is seeking litigation funding however we have not received any official word or approach from this firm. Our priority has always been to work to resolve any issues with our customers directly," a Vodafone spokeswoman said.
Mr Ivanstoff told The Australian that the law firm was yet to fully quantify the extent of the damages claim. Larger claims could come from small businesses claming direct business losses due to problems with Vodafone’s mobile service.
"A lot of the businesses that are coming to us are saying that they missed work because of calls that weren't received or voicemails that weren't received. So there is that additional category of losses flowing from the service not functioning properly," he said.
Around a third of the claimants were small businesses but Piper Alderman was unable to provide details on their size.
Reported problems with VHA's network include constant call drop-outs and reception problems.
Damage to the company's brand due to the service problem was believed to have contributed to a disastrous subscriber growth performance result for the mobile provider for the second-half of 2010. VHA's subscriber growth for the half to December 31 was 142,000 compared with new customer additions of 539,000 in the previous corresponding half.
As the extent of Vodafone’s network problems were becoming apparent last October, VHA announced a major network upgrade program to boost its 900MHz and 2100MHz network and add a new 3G 850MHz network layer to ease pressure on it network resources.
It said it would add 1400 new sites to its 900Mhz and 2100MHz networks in metro and regional areas, and build its new 850MHz network across 1500 sites.
Around 900 of the new metro 2100MHz sites would come from a pool of around 1350 sites it expected to retrieve from the gradual termination of its 2004 joint-venture with Telstra.
Last December VHA chief executive Nigel Dews issued an apology to the carrier’s customers and pledged to fix the problems.
Last week the company announced its network roll-out was proceeding on schedule.
It said it had turned on 775 new 850MHz sites and that a further 810 sites had been upgraded, including 330 in high-congestion areas.
By the end of the year it aimed to upgrade a further 520 sites and establish a further 500 850MHz sites, the company said.
Last October VHA said that it had spent $550 million on its business consolidation program to consolidate Hutchison 3 and Vodafone into a single business since they merged in 2009.
It may all be too little too late, however, to hold off the class action suit and further brand damage.
Mr Ivanstoff said that the number of litigants was expected to grow if the company could secure firm funding arrangements for the class action.
"If we get funding in place and we can communicate that with people, if and when that happens, we'd hope to get more," Mr Ivanstoff said.
Vodafone Australia class action gathers momentum