New York Attorney General Secures $2.2 Million for TWC Subscribers
Cable provider found to overcharge 18,437 customers
March 15, 2013
-- New York Attorney General Eric Schneiderman announced that his office
has reached a settlement with Time Warner Cable after a two-year
investigation found that the company overcharged subscribers in 10 upstate towns and villages. The settlement requires Time Warner Cable to
pay $2.2 million in refunds to 18,437 customers and stop charging
subscribers’ fees that exceed the amounts permitted under their
municipalities’ franchise agreements. As part of the agreement, Time
Warner Cable also agreed to pay $200,000 in fees and costs to the State
of New York.
The settlement requires Time Warner Cable to refund overcharges
collected since March 2007, with interest, to current subscribers in the
Towns of Glenville, Livonia, Stafford, Oakfield, Geneva, Thompson,
Lima, Batavia and the Villages of Waterloo and Ellenville.
“For too long, Time Warner Cable
has been overcharging fees to its customers in direct violation of their
local franchise contracts. This agreement brings millions of dollars in
refunds to upstate consumers who overpaid their bills,” Schneiderman said.
“Many New York families operate on a tight budget and every dollar
counts. My office will not tolerate cable companies that ignore their
contractual obligations and overcharge New York subscribers.”
Time Warner Cable’s billing
practices were brought to the Attorney General’s attention by the Town
of Glenville in January 2011. The Attorney General began a two-year
investigation which found that Time Warner Cable had in fact been
overcharging Glenville residents for many years, and that Time Warner
Cable had been improperly charging consumers in other upstate
communities with franchise agreements that Time Warner Cable had
acquired from Cablevision in 1995. Although Time Warner Cable
stopped overcharging franchise fees to consumers and voluntarily made
$1.4 million in refunds to subscribers in eight towns in 2007 and 2010,
it continued to overcharge consumers in the 10 towns and villages
covered by this particular agreement, Schneiderman’s office said.
Some of the franchise agreements at issue limited the fee Time Warner Cable paid the town to
3 percent of gross revenues, and prohibited the cable company from billing
subscribers any part of this cost. Other franchise agreements required
Time Warner Cable to pay a 5 percent franchise fee and permitted it to pass-through two-fifths of this fee to subscribers. The
municipalities also had the option to voluntarily allocate two-fifths of
the fee to a fund subsidizing the cost of expanding the cable network
in their communities, in which case none of the fee was permitted to be
passed-through to consumers. The Attorney General’s investigation found
that Time Warner Cable violated both types of franchise fee
As a result of the settlement, Time
Warner customers will receive credits on their bill within 90 days,
with the amount proportional to their monthly subscription charges.
Individual overcharges vary by customer and town, but average $119 with
accumulated interest. As part of the investigation,
Time Warner Cable reviewed its records of all its New York franchise
agreements purchased from Cablevision and identified no other towns
where similar overcharges had taken place during the period from 2007 to
was handled by Assistant Attorney General Keith H. Gordon of the Bureau
of Consumer Frauds and Protection, under the supervision of Bureau Chief
Jane M. Azia and Executive Deputy Attorney General for Economic Justice
Karla G. Sanchez.
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