NEW YORK, March 30 (Reuters) – A federal judge on Monday granted Verizon Wireless a preliminary injunction blocking rival T-Mobile from running ads promising consumers more than $1,000 of annual savings if they switch cellphone carriers.
U.S. District Judge Lewis Kaplan in Manhattan said Verizon would likely succeed on the merits of its claim that T-Mobile’s “Save Over $1,000” campaign constituted false advertising, resulting in irreparable harm.
He also said an injunction would serve the public interest by promoting truthful and accurate advertising, “ensuring that what consumers see is what they get.”
T-Mobile and its lawyers did not immediately respond to requests for comment.
In its February 4 lawsuit, Verizon accused T-Mobile of comparing its promotional rates with Verizon’s standard rates, and inflating the value of services that “the other guys leave out.”
T-Mobile countersued on March 2, saying Verizon’s own campaign featuring George Washington, Abraham Lincoln and Benjamin Franklin was bogus because that carrier could not promise a “better deal” for T-Mobile or AT&T Mobility customers.
Kaplan said T-Mobile’s promise of big savings by switching to its Better Value Plan from Verizon’s Unlimited Ultimate Plan was “literally false” because T-Mobile conducted an “apples-to-oranges” comparison.
He said that after accounting for differences in the plans, the potential savings fell to $228.84 annually.
“Competition in the cellular service market is intense and in some ways zero-sum,” Kaplan wrote. “Each provider wants for itself as many customers as it can get. Customer attention thus is a commodity and a fleeting one at that… But this legitimate competition and innovation cannot come at the expense of truthfulness and accuracy.”
Verizon said in a statement: “Our competitor has a long history of making false advertising claims. Today’s decision validates our belief. Facts matter.”
As of December 31, Verizon and T-Mobile respectively had 146.9 million and 142.4 million subscribers, according to the companies’ financial reports. AT&T ranked third with 120.1 million.
(Reporting by Jonathan Stempel in New York; Editing by Franklin Paul and Bill Berkrot)
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