Verizon customers who were part of a $100 million class-action settlement over undisclosed administrative fees are beginning to receive their payouts—but many are expressing disappointment over the amounts.
Instead of the promised minimum of $15 to $100 per claim, some recipients reported payments as low as $2.37, leading to frustration and confusion among participants.
Verizon Settlement Payments Fall Short: Customers Receive Less Than Expected
The settlement, which resolved allegations that Verizon charged deceptive administrative fees, applied to current and former customers who used postpaid wireless or data services between January 1, 2016, and November 8, 2023.
According to CBS News, customers who filed valid claims by the April 15 deadline were eligible for compensation, with the settlement terms outlining a base payout of $15 per account, plus an additional $1 for each month they were charged the fees, capped at $100.
However, the final payouts were determined based on several factors, including the number of claims submitted, legal fees, and the total funds available for distribution. According to the settlement website, if the total payouts exceeded the amount in the settlement fund after legal costs, individual payments were reduced proportionally.
On social media platforms like X (formerly Twitter), frustrated customers shared screenshots of their payouts, with many pointing out amounts that fell far below the minimum $15 outlined in the agreement. One recipient shared an image of a prepaid Mastercard for just $2.37, while others reported receiving amounts around $4 or $5.
Frustration Over Small Verizon Settlement Payouts: Legal Costs and Taxes Explained
Verizon has not provided an official explanation for why some payments were so low, but the settlement website noted that factors such as taxes, fees, and pro-rata adjustments could impact the final amount, USA Today said.
Legal fees also played a significant role, with reports indicating that plaintiffs' lawyers requested $33 million from the settlement fund.
The class-action lawsuit alleged that Verizon's administrative charges were not transparently disclosed during the sales process or in billing statements, leading to claims of deceptive practices. Verizon denied any wrongdoing but agreed to the $100 million settlement and committed to updating its customer agreements to provide clearer descriptions of administrative charges.
While the settlement aimed to address concerns about transparency, many customers are left feeling shortchanged. The case highlights the complexities of class-action settlements, where the final payouts often depend on variables like the number of claimants and legal costs.
For now, those who received their payments are voicing mixed feelings—some grateful for any compensation, while others dismiss the effort as a "waste of time" due to the unexpectedly small amounts.
