Attorney General Announces Settlement with Vonage Regarding Cancellation Issues

November 16, 2009

Contact: Kate Simmons, (207) 626-8577

November 16, 2009


Company will refund consumers and modify its cancellation and retention practices

Attorney General Janet Mills announced today that Maine and 31 other states have entered into a $3 million settlement with VONAGE, one of the nation?s largest providers of VoIP (Voice over Internet Protocol), an Internet-based telephone service. The settlement requires VONAGE to make significant changes in its business practices, particularly in marketing its service, and in handling consumer cancellation and refund requests. Maine will receive $45,000 from the settlement for consumer protection efforts.

VONAGE formerly paid incentives to its customer service representatives for retaining, or ?saving,? customers who tried to cancel. As a result, many consumers complained of their difficulty, or inability, to cancel service with VONAGE. The settlement establishes strict limitations on this practice, and requires recording and verification of these telephone calls. In addition, VONAGE must revise its disclosures regarding the offer of ?free? services, money back guarantees and trial periods.

?This settlement globally resolves the states? concerns about VONAGE?s deceptive marketing practices and poor customer service,? said Attorney General Mills.

Maine consumers or businesses who have filed complaints since January 1, 2004 with the Attorney General?s Office or another state regulatory agency may be eligible for restitution from VONAGE under the settlement if their complaint has not been resolved. New complaints under this settlement will be accepted until March 16, 2010 and will also be considered for restitution by VONAGE. VONAGE will have a minimum of 6 months to evaluate each complaint for eligibility under the terms for restitution under the settlement, and to make payment.

Vonage settlement agreement