T-Mobile Sues to Stop Prepaid Phone Hacking

BROOKLYN, N.Y. (CN) - DK Wireless, IA Communication and Ajay Mehta have been accused of buying prepaid T-Mobile cell phones in bulk from Wal-Mart and other retailers, hacking in to the software, illegally unlocking the phones for use on other networks and reselling them for a profit.

In a federal complaint, T-Mobile claims this "subsidy theft scheme" is so widespread that most T-Mobile retailers limit the number of prepaid phones that an individual may purchase on a given day. However, the defendants allegedly circumvent this protection by hiring several "runners" to make separate trips to the stores.

DK Wireless, doing business as Wireless Touch and Talk 2 Me, will then sell the altered phones to unwitting customers, who are unable to exercise the warranties once their phones have been hacked.

Further, T-Mobile says it spends a significant amount of time and money fielding calls from consumers who bought a hacked phone for use on other networks, but were confused by the phones' T-Mobile marks.

T-Mobile wants the court to force the defendants to shut down their illegal operation, and pay the plaintiff actual and punitive damages.

The phone company is represented by Friedman Kaplan Seiler & Adelman.

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