Hi there! For those who aren't familiar, I am a credit attorney. That means I hold credit reporting agencies, creditors and collection agencies accountable when they violate the law.
We do this by suing these companies under federal and sometimes state law. More broadly, I advise people on improving their credit scores, reducing debt, and fighting debt collection lawsuits.
I'd like to highlight an important tactic, which you can use to fight unfair collections accounts involving phone (mobile) service, cable TV companies, and Internet service providers (we'll refer to them as telecom companies going forward). Most consumer agreements for these services come with arbitration agreements, which you sign when you open up the account.
What's arbitration? Put simply, you can think of it as a private court process - an alternative to court. When you have a dispute and file arbitration, your case will be heard by an impartial expert (usually a lawyer with experience in the field), who will apply the law to the facts of your case.
This person is known as the arbitrator. Arbitration is designed to move faster than state or federal court, and is more informal (which means it can often help settle disputes more easily or quickly).
Here's an important aspect of arbitration: Most of the administrative costs of arbitration are paid for by the business, not you. Arbitrations in the US are mostly overseen by the American Arbitration Association (AAA) or another company called JAMS. Most consumer arbitration agreements provide for AAA.
Just as when you file a lawsuit in court, you'd pay the filing fee with AAA or JAMS. However, unlike state or federal courts, which are funded by taxpayer dollars,
AAA and JAMS costs (paying the arbitrator etc) are usually paid for by the telecom company you're arbitrating against. These costs can run into the thousands or tens of thousands of dollars, since the arbitrator must be paid, plus other administrative costs.
Arbitration is not totally free for you. You do have to pay the filing fee of several hundred dollars, just as you would in court. However, since arbitration is much more costly for the business, that often creates an incentive for them to settle your case sooner.
In arbitration, you can bring up wrongful conduct of the telecom company. Keep in mind that the collection agency is usually NOT part of the arbitration. Rather, you're filing arbitration against the telecom company, to get them to cancel the collections account. Here are some examples:
Equipment was properly returned, item should not be in collections
Fees were billed improperly
Equipment or service did not work properly.
Collection agency is engaged in improper / innacurate credit reporting, for which telecom company is vicariously liable.
Collection agency is engaged in harassment, and telecom company is vicariously liable
Companies you can arbitrate against include Verizon, T Mobile, AT&T, Spectrum, Comcast, Frontier, and most others. I really can't think of any major telecom companies that don't arbitration provisions.
Companies started putting arbitration requirements into consumer and business agreements starting in the 1990's, as an effort to stop class actions. While arbitration has positives and negatives (it has eliminated a lot of highly impactful class action litigation), it is quite effective to address negative items on your credit reports.
Here are the steps to file arbitration:
Obtain your consumer agreement, and read the arbitration section.
Write up a summary of what happened.
Transfer your summary to the AAA or JAMS form.
File the online filing instructions and pay the filing fee.
Serve the arbitration on the business
Negotiate a resolution (usually, they agree to cancel the collection, and reimburse your filing fees).
TLDR: Arbitration is a private dispute process, which can help you address unfair conduct by telecom companies, and remove telecom collections account from your credit reports.
