Start Over: Court Denies Time Warner Cable's Class Action Settlement

Time Warner Cable‘s nearly 10-year-old class action lawsuit involving the sale of personal subscriber data seemed on its way to resolution after parties struck a deal in Oct ’05. The newspaper notification ads had ran, a Website had collected valid claims (http://www.twcsettlement.com) and a final settlement approval hearing occurred back in May. But just a few weeks ago, a judge with the US District Court for the Eastern District of NY denied approval of the plan, according to the MSO’s 10-K filed Fri. The judge’s problems with the settlement highlight the difficulties of not having a national footprint. The proposed deal would have given TW subs between Jan 1, ’94 and Dec 31, ’98, and who were listed on its ’99 sales database, a free month of additional service or 2 free movies on demand (Cfax, 12/21/05). If a database member is no longer a subscriber, they could opt to receive a free month of service with no installation fee. If they live outside TW’s service area, they could have transferred the rights to someone in the MSO’s territory. Part of the problem with the settlement, the judge said, was that it’s unfair to subs no longer in TW’s footprint since they have to transfer their benefit to someone else and release all claims against the operator. The decision also stated that it’s unfair to people who were subs during the period but aren’t listed on the ’99 sales database because they receive nothing and have to release all claims (they could have been on some earlier databases, objectors have argued). "TWC intends to defend against this lawsuit vigorously, but is unable to predict the outcome of the suit or reasonably estimate a rage of possible loss," the MSO said in its Fri SEC filing. TW Cable declined to comment further. The lawsuit was filed in 1998, claiming that the company sold subs’ personal info and failed to inform customers of their privacy rights.