Sprint Nextel (and, potentially, the U.S. wireless industry at large) was dealt a legal defeat Monday by a California judge, who ruled that Sprint is liable for $73 million in refunds and credits to subscribers who were charged wireless early termination fees (ETFs) in violation of California state law. The tentative decision, handed down by Alameda County Superior Court Judge Bonnie Sabraw, addresses a 2003 class action suit that was brought against Sprint by two million customers. Similar suits are pending against other wireless carriers in Alameda County and in courts throughout the country. (Earlier this month, Verizon Wireless agreed to pay $21 million to settle class action ETF complaints as its case in Alameda County was about to go to trial.) Although a jury concluded last month that class action members did breach their contracts with Sprint and that the costs incurred by Sprint through that breach exceeded the ETFs paid by the plaintiffs, Sabraw nevertheless ordered Sprint to refund $18.2 million in ETFs paid by the complainants and to credit an additional $54.7 million in ETFs that were charged to customers but were never collected. Proclaiming that Sprint’s ETF policy violates tenets of California contract law, Sabraw rejected Sprint’s argument that ETFs constitute rates that are subject to federal rather than state jurisdiction. Noting, “there was no evidence at trial that [Sprint] did a damage analysis that considered the lost revenue from contracts,” Sabraw further observed that Sprint implemented ETFs “primarily as a means to discourage customers from leaving” their wireless contracts. As a spokesman for the Consumers Union praised the ruling as “a huge victory,” Sprint Nextel stressed: “this is a tentative decision, and we are focusing now on our response to the court.” The FCC, meanwhile, is expected to issue its decision later this month on proposed rules that would regulate ETFs.