SOURCE: Carlton Fields

September 16, 2009 18:00 ET

TracFone Wireless Continues to Succeed in Its Aggressive Campaign Against Phone Subsidy Thieves

Company Obtains $6 Million in Judgments in First-Ever Victories in Pennsylvania

PITTSBURGH, PA--(Marketwire - September 16, 2009) - TracFone Wireless, Inc. aggressively combats cell phone trafficking with its nationwide effort to stop the unauthorized resale and hacking of its prepaid mobile phones. These ongoing efforts work to protect consumers against cell phone subsidy thieves to keep wireless service accessible and affordable for all.

Judgments totaling $6 million were recently entered in two separate federal court cases in the Western District of Pennsylvania against defendants who participated in unlawful wireless phone hacking schemes. The precedent-setting judgments are the first of their kind to be handed down in Pennsylvania. To date, TracFone has filed more than 60 lawsuits in federal courts in California, Florida, New York, Texas, Oklahoma, and Georgia. Those courts have entered judgments and injunctions in TracFone's favor against 154 separate defendants and awarded a total of more than $122 million in damages. TracFone is engaged in a nationwide effort to identify the perpetrators and bring them to justice, and is working closely with law enforcement authorities.

One stipulated judgment was handed down September 9 by U.S. District Judge Sean J. McLaughlin, prohibiting defendants 1st Premier Communications and Jeffrey Stablein from continuing to engage in the bulk purchase, sale, or unlocking/reflashing of TracFone's wireless phones. Separately, U.S. District Judge Joy Flowers Conti entered a similar order against defendants Northeast Cellular, Inc. and Jason Daugherty, finding their conduct violated numerous state and federal laws.

Perpetrators like 1st Premier Communications, Stablein, Northeast Cellular, Daugherty, and their co-conspirators, purchase large quantities of subsidized TracFone prepaid phones at retail stores. The phones are then passed to middlemen who alter or remove the prepaid software and resell the altered phones as new, often in counterfeit packaging, at a significant profit to unsuspecting customers domestically and abroad in Latin America, Asia and the Middle East.

In addition to filing lawsuits, TracFone is taking other aggressive steps against cell phone traffickers because it has the potential to drive up costs for consumers. Last year TracFone instituted a public-service website, www.StopCellPhoneTrafficking.com, which provides the public with basic information about the cell phone trafficking, contains copies of all of the judgments obtained against traffickers across the country, and allows consumers to report suspicious activity by calling a hotline or submitting an on-line tip. TracFone's public information campaign has also involved running advertisements in numerous local and nationwide publications and websites, and most recently involved placing outdoor advertisements on billboards across the country.

TracFone is represented by Carlton Fields Shareholders James B. Baldinger and Steven J. Brodie. "Cell phone trafficking is a nationwide concern for the wireless industry and TracFone is committed to putting an end to these unlawful practices," said Brodie. Baldinger added: "TracFone intends to file many more lawsuits around the country, and to continue working closely with law enforcement, private investigators, and handset manufacturers to attack the perpetrators from all sides. Anyone engaged in this practice should be concerned that they may be our next target."

Carlton Fields offers a full range of legal services in more than 30 areas of law. Established in Tampa, FL in 1901, the firm maintains offices in Atlanta, Miami, Orlando, St. Petersburg, Tallahassee, Tampa and West Palm Beach. Additional information is available on the firm's web site located at www.carltonfields.com.

TracFone Wireless Inc. is America's largest and number one prepaid cell phone provider. With over 12 million subscribers, TracFone Wireless has been the undisputed leader in prepaid wireless since its founding in 1996. TracFone Wireless is a subsidiary of América Móvil S.A.B. de C.V. ("AMX") (BMV: AMX; NYSE: AMX; Nasdaq: AMOV; LATIBEX: XAMXL). América Móvil is the fourth largest cell phone company in the world and the largest in all of the Americas with more than 182 million cell phone subscribers. América Móvil has been named a "Technology Hot 100" company by Business Week for the past two years in a row. For more information, visit www.tracfone.com.

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