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Are Automatic Renewal Clauses In Telecommunications Contracts Legal?

By July 6, 2018No Comments

In our nationwide telecommunications practice, we are often contacted by businesses and individual consumers who have attempted to cancel their telecommunications service contract in order to change to a different service provider. They were surprised to be told that their contract, which they thought was for a fixed term, had an automatic renewal provision which automatically extended the contract for either an additional year, or even longer.

These automatic renewal provisions are enforceable in some states, although there is a trend among certain states to limit the applicability of these clauses. New York, for example, has a very strong statute which requires a service provider to notify a customer, in advance and in writing, that their contract contains an automatic renewal provision, thus providing the customer a “heads up’ that they need to take steps to cancel the service contract if it is not their desire to continue with that provider.

If you have encountered this type of situation with your business or home telephone service provider, or even with your cellular provider, please contact our office. We can look into the specific facts of your situation and let you know if you have protection in your state. Above all, we recommend that everyone read all service contracts carefully, make note of any such automatic renewal provisions, and create a reminder in your calendar or diary system to be sure to cancel a contract before it automatically renews.

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