back to article UK telcos didn't collude to put Phones 4u out of business – judge

A lengthy lawsuit is nearing an end after a judge dismissed a claim from defunct British phone retailer Phones 4u that local telco operators conspired to put it out of business. The Honorable Justice Roth oversaw the claim and ruled [PDF] that the defendants, including EE, Vodafone, Orange, and Telefonica O2 Holdings, had not …

  1. Timto

    "However, Roth again remarked that drawing any adverse inference from their absence would be inappropriate."

    When a party has allowed evidence to be destroyed I would suggest drawing an adverse inference would be highly appropriate, not least as a deterrent to others.

    1. steviesteveo

      It means you'll never have a satisfying conclusion to the issue. "None of the surviving evidence showed collusion" is a hell of an asterisk to be left with

  2. J. R. Hartley

    The title is no longer required

    Yeah. But they did though.

  3. juice

    Wasn't this the usual cashing-out issue?

    https://www.theguardian.com/business/2014/sep/15/phones-4u-founder-john-caudwell-retailer-collapse

    Phones 4u earned more than £100m in profits before tax, debt interest and other items last year ...BC bought Phones 4u in 2011 for €770m (£610m), leaving the business with debts of £635m. A year ago, BC recouped all the money it paid for Phones 4u when the retailer issued £200m of bonds that were used to pay BC a one-off dividend.

    I'm guessing it was the impact of being loaded with all of this debt which left phones4u in a position where they couldn't come to a contractual agreement with the network providers...

    1. Elongated Muskrat Silver badge

      Re: Wasn't this the usual cashing-out issue?

      I think there's probably also an element of the viability of the business to start with. If your business is essentially to come to an agreement with operators to re-sell their products at a lower price, with the advantage of getting the money up-front, isn't it always going to be a case of taking the money and running away from the debt before it comes due?

      I once worked at a place that administered part of the "cashback" deals P4U had, which they used to make their offerings look attractive to customers (I wasn't directly involved with this, but saw it in action). These were set up in such a way that the claimant had to make multiple claims, at specified dates, months after buying a phone, in order to get the money back. It doesn't take a great stretch of the imagination to see that this was done entirely so that a significant number of customers never got their "cashback," and the company made that money as profit. If those are the sort of business practices we are talking about, there's no requirement whatsoever for other parties to collude to put them out of business, the reputational damage they were causing to themselves, and loss of repeat business to disgruntled customers would do the job just fine.

      1. Anonymous Coward
        Anonymous Coward

        Re: Wasn't this the usual cashing-out issue?

        I also have experience of P4U and Caudwell Comms.

        Vile place filled with an unusually high proportion of vile people (I once had the misfortune to bump into Mr Caudwell himself at his warehouse in Crewe), I often got the impression they weren't running boiler room or Amazon refund scams by sheer luck rather than any kind of moral qualms.

        Lights come on when you discover that Caudwell was a used car salesman before he was in the mobile phone business.

        1. Anonymous Coward
          Anonymous Coward

          Re: Wasn't this the usual cashing-out issue?

          Many years ago I briefly had a university summer temp job being a warehouse monkey at said warehouse in Crewe. I once made the mistake of politely questioning the legality of something that we were doing to my supervisor, and was told to mind my own business.

          That evening I received a phonecall from the temp agency telling me that my services were no longer required. I can't say that I was too upset.

          1. Anonymous Coward
            Anonymous Coward

            Re: Wasn't this the usual cashing-out issue?

            Were they frisking you and having you sign a disclaimer about being allowed to strip search you when you were temping?

            1. Anonymous Coward
              Anonymous Coward

              Re: Wasn't this the usual cashing-out issue?

              Haha no, but I wouldn't have been surprised.

              This was something that would probably be best described as a paperwork issue relating to the goods we were dealing with.

        2. R Soul Silver badge

          Re: Wasn't this the usual cashing-out issue?

          "Lights come on when you discover that Caudwell was a used car salesman before he was in the mobile phone business."

          Which means the next steps in his career are likely to be estate agent and then Tory MP.

          IMO there's little difference between the used car trade and the mobile phone business. They're both full of sleazy salesdroids who'd say or do anything to shift over priced, dodgy and knackered tat. All sold with a worthless extended warranty of course.

          1. Elongated Muskrat Silver badge

            Re: Wasn't this the usual cashing-out issue?

            They all wear cheap blue nylon suits, and pretend to be your buddy whilst metaphorically reaching into your back pocket to nick your wallet.

            The ones in the expensive blue suits are the ones who have succeeded in scamming enough people to buy a veneer of respectability, eh, "Call me Dave". (ooh! topical)

      2. I ain't Spartacus Gold badge

        Re: Wasn't this the usual cashing-out issue?

        Elongated Muskrat,

        Although maybe Phones 4 U suffered from the same thing from the mobile companies?

        I remember being handed a horrible mess when I started working for a UK office supplies retailer over 20 years ago. We'd got loads of mobiles. From memory we only sold Pay-as-you-go handsets. We were supposed to get paid a rebate when the handset was sold - and then another rebate from the network when a Pay&Go SIM was registered for it on their network. But as far as I could tell, coming into it a couple of years after the event - we'd been paid somewhere between none of the rebates owed to us, and maybe about 10%.

        The issue was further complicate by the fact that the wholesaler we'd bought the phones from didn't have any plastic shop samples for us. So they sold us some extra handsets as samples, again we were supposed to get a rebate for those that we couldn't sell on - when they finally replaced them with the samples we needed. No samples ever turned up, no rebate was ever paid for the difference in cost in the fact we'd had to use real handsets as samples. And this was way before the era of smartphones on display with wired and alarmed things fixed to them - so basically all our samples were usable mobile phones that merely needed a charger - and so had been stolen. Possibly by the shop staff, who of course had the charger and box in the back of the store - but I didn't say that...

        I also did a temp job before that retail job for an insurance company. They did the handset insurance for DX Communications. And a good 10-30% of the insurance agreements I saw had the forms filled in, in different ink and with different signatures than the contract forms. Sales staff in the stores got a bonus for everyone who signed up for an insurance contract with their phone contract and so a lot of people mysteriously did. The banks had given the insurance company an exemption for being reliable that tey didn't have to pass the actual direct debit paperwork on to the banks to check - they just had to say the'd checked it themslelves. For their normal insurance clients, that was probably a reasonable and sound decision. In the mobile industry I've never dealt with a single company I'd trust as far as I can throw them. Not quite fair. The original Hutchinson version of Orange were well-run and a pleasure to do business with.

      3. The McLeish

        Re: Wasn't this the usual cashing-out issue?

        Some places still operate "cashback from bill redemption" and anytime I encounter someone or somewhere that offers or mentions this, i get a cold shivver of hellish dread up my spine

  4. The McLeish

    Reading some of the comments here suggest the narrative that none of you had the displeasure of working in p4u retail, and actually having to go through several horrors of the company alongside idiots that would try and make your life as miserable as possible.

    Dodgy managers

    Theiving managers

    Colleagues that would routinely talk about what they got up to, when they got up to, how they got up to and where!

    Poor communication

    Judgemental idiots.....

    ....

    I could go on, but you'd be here for a long time.

  5. Farmer Fred

    P4U was a dead duck long before Skodafone and Nothing Nowhere pulled the plugs. Many factors played their part, but advertising campaigns that inferred that their potential customers were window licking inbreds has to rank fairly highly on the Ratner scale!

    1. I ain't Spartacus Gold badge
      Devil

      What if their customers were window-licking inbreds?

  6. Doctor Syntax Silver badge

    It seems I got away lightly. Just a short DBA contract for holiday cover with the parent company.

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