Charter tells court that its no-refund policy helps prevent price increases

Enlarge / A Charter Spectrum vehicle. (credit: Charter)

Charter is suing Maine to block a new state law that requires prorated refunds when cable customers cancel service mid-month, claiming that the requirement is a form of rate regulation and is preempted by federal law. The preemption question will be at the heart of the case, but Charter also told the court that its no-refund policy prevents its prices from rising even more than they usually do.

"Charter's decision not to provide a partial-month rebate for cancelling subscribers reflects the fact that Charter's service is sold on a monthly basis," the company, which operates Spectrum TV service, said in its complaint against the state government. "It also reduces administrative costs and thus ultimately reduces the upward pressure on rates for Charter's continuing subscribers."

Charter further said that its policy minimizes price increases "for continuing subscribers by reducing costs associated with implementing pro-rata rebates for mid-month cancellations." Charter said that subscribers who cancel in the middle of a monthly billing period can continue to receive the service until the end of the month.

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