The Supreme Court of Canada has given the go ahead to an $18 billion class action suit — the largest in Canada’s history —against the country’s biggest cellphone companies.

The proceeding targets about $12 billion (plus interest) in monthly “system access fees” charged to customers since 1988. It’s described as the country’s largest class action as every cellphone user in Canada — roughly half the population — is potentially affected.

The companies, which include Bell Mobility Inc., Rogers Wireless Inc. and Telus Corp., their various affiliates, and some smaller, regional players, have lost eight appeals in their long bid to squash the action, which argues the carriers falsely led subscribers to believe their system access fees were required by federal regulators.

But on Thursday, the high court dismissed the wireless and cellular giants’ request to revisit last fall’s Saskatchewan appeal court finding which upheld a 2008 certification of the lawsuit.

The complaint was triggered in 2004 by a Toronto Star investigation which revealed the industry collected about $800 million annually from the controversial fees.

The investigation also found many of the companies’ customer service agents were incorrectly telling consumers the fee was a mandatory government charge collected on behalf of the Canadian Radio-television and Telecommunications Commission.

The suit’s allegations, which are unproved in court, include false advertising, collusion, and “unjust enrichment” — meaning the firms received money to which they had no legal entitlement.

Telus, Rogers and Bell discontinued the levy in 2009.

The carriers have said the money collected by the system access fee went toward paying for their licenses and purchasing wireless spectrum, as well as maintaining and upgrading their expensive wireless networks.

“We are confident the case is without merit and baseless, at least as it relates to Telus,” said a company spokesperson.

“The system access fee was a breakout of government related charges, like spectrum licensing (and) a mandatory charge for services for the deaf and hard of hearing customers,” said the Telus rep. “We were always very upfront about what that fee covered. Those expenses have not disappeared, we’ve merely integrated them into our new all-in pricing.”

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Rogers spokeswoman Leigh-Ann Popek said: “We’re confident this claim is unfounded and now look forward to having our day in court on the merits of this claim.”

Bell representatives did not respond by deadline.

The $18 billion is “in the range of five years of profit,” said lawyer Tony Merchant, who initiated the action, of the claim figure suggested by the carriers.

“It also shines a light on the high cellular charges that Canadians are paying which may lead to resistance and might lead to competitors,” the Regina-based litigator said.

Merchant Law Group was also involved in the $5 billion residential schools settlement, the largest class-action settlement in Canadian history. While that case drew 12,000 registrants to Merchant’s firm, the system access action has so far garnered contact from just under 30,000 consumers.

The system access fee has its origins in a 1985 license charge required by each mobile cellular subscriber to be remitted to the department now known as Industry Canada. Some companies collected about $4.95 on behalf of consumers. But that requirement was eliminated in 1987 with the feds instead selling radio channel licenses, also known as spectrum licenses, to the defendants as providers of wireless services.

“Although there are annual fees charged by the government to the defendants as providers of cellular and wireless services, these fees amount to less than 20 per cent of the additional charges being charged to their customers under the guise of government taxes,” says the statement of claim.

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“A real $4.95 cost to the companies went to twenty-five or thirty cents, then down to pennies; but no one was prepared to walk into (their company president) and say ‘Let’s cut our profits by $200 million next year by coming clean,” said Merchant. .

The telecom firms insist the “system access fees” were legitimate and constituted a charge to defray various operating costs of which only a portion is the cost of the spectrum license fee.

Barring a settlement the suit would reach court in about two years.

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