U.S. Government Sues Sprint for Alleged Overcharging on Court-ordered Wiretaps

The U.S. Government is suing Sprint for allegedly overcharging $21 million on complying with court-ordered wiretaps.

The government wants treble damages – which works out to $63 million – and civil penalties, according to documents filed in California federal court.

The documents explain that Sprint was directed by court orders to comply with wiretaps, pen registers and trap devices, but it can only ask for “reasonable expenses it incurs in providing facilities or assistance to accomplish a court-ordered wiretap, pen register, or trap device.”

The government claims Sprint inflated charges by 58 percent, causing federal law enforcement agencies to pay over $21 million in unallowable costs between Jan. 1 2007 and July 31 2010.

The FCC has a rule that carriers cannot pass on the costs of its CALEA (the Communications Assistance for Law Enforcement Act) upgrades to law enforcement agencies on intercept bills. Yet, between 2007 and 2010, Sprint included CALEA upgrades in intercept charges.

“As alleged, Sprint overbilled law enforcement agencies for carrying out court-ordered intercepts, causing a significant loss to the government’s limited resources,” U.S. Attorney Melinda Haag said in a statement released by her office. “This office will use all available tools to protect the public …, and we will continue to hold those who present false claims to the government accountable.”

The allegedly false claims were submitted by Sprint to the Federal Bureau of Investigation, Drug Enforcement Agency, US Marshals Service, Bureau of Alcohol, Tobacco and Firearms, and Immigration and Customs Enforcement (ICE).

Ars Technica reported that Sprint denies the allegations. “Under the law, the government is required to reimburse Sprint for its reasonable costs incurred when assisting law enforcement agencies with electronic surveillance," Sprint said in a statement which was published by Ars Technica. "The invoices Sprint has submitted to the government fully comply with the law. We have fully cooperated with this investigation and intend to defend this matter vigorously.”

Some critics of controversial government wiretapping efforts appear to be amused by the lawsuit. “It remains to be seen whether Sprint was actually overcharging government agencies, or whether the government simply had the gall to sue for a better deal while privacy discussions and disputes rage nationwide,” according to a blog post from Slate.