Vonage agrees to pay $4.75 million in class action suit

VoIP provider Vonage Holding Corp. (NYSE:VG) has agreed to pay $4.75 million to fund a class action settlement related to the company's sales and marketing practices.

The multi-district litigation involved Vonage's promotional "one month free" and "money back guarantee" offers and application of certain charges (including disconnect, cancellation and termination fees), and subscription fees despite requests for cancellation, which allegedly violated the law.

The U.S. District Court of New Jersey this week granted final approval to the proposed settlement which offers eligible class members reimbursements for certain payments made by Vonage subscribers. Class members includes anyone in the United States who subscribed to Vonage services on or before Jan. 3, 2011, with certain exclusions, and who was unable to receive a full month of free service, did not receive a full money back guarantee under certain circumstances, was charged disconnection fees after cancellation, or paid for monthly service after requesting cancellation.

The settlement will likely provide dollar-for-dollar recovery to most settlement class members, said the law firms Seeger Weiss LLP and Cohen Milstein Sellers & Toll PLLC.

For more:
- see this release

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