Update: Sprint targets more employees in alleged overseas cellphone schemes

For the second time in a week, Sprint has targeted unnamed employees in federal court as part of an effort to combat cellphone trafficking.

Each lawsuit seeks action against “John Does” who work either directly or indirectly for Sprint and used their inside status to help international schemers. The schemes involved unlocking phones from Sprint’s wireless network so they could be resold for illegal profits.

Each case also involved a private sting operation run by Sprint’s investigators, according to the lawsuits.

In the newest lawsuit, filed Monday, Sprint outlined claims against Sanjay Prasad whom it identified as a New Jersey businessman purportedly working with “an entity from Dubai looking to purchase” more than 1,000 wireless phones a week.

Sprint’s investigators claim they sold 105 phones from Sprint’s Boost Mobile brand to Prasad’s company, Global Business Dimensions Inc. They tracked where the Boost phones showed up, finding that 15 had been activated in Oman, Pakistan, the United Arab Emirates, India or the United States.

It further claims that the phones had been unlocked with the assistance of 10 John Does who “at all times relevant” to the case were Sprint employees who took payments to unlock the phones illegally. Each of them, Sprint said in the suit, “breached their duty of loyalty to Sprint” and caused losses to the company, among other charges.

Prasad could not be reached Tuesday.

On Monday, The Star reported that Sprint had sued 20 unnamed employees along with Adik Kummetov of Tashkent, Uzbekistan. In that case, Sprint investigators claimed to have seen Kummetov’s website and contacted him. They unlocked five Sprint phones for Kummetov and received $50 via PayPal for their effort, the suit said.

“Kummetov then sent the investigators additional IMEIs (the numbers that identify specific phones) to unlock and stated he needed someone within Sprint to unlock phones. He also claimed he has been offering unlocking services for ten years,” the suit said.

Sprint has battled cellphone trafficking for years by filing lawsuits in federal courts around the United States. The company claimed many victories in a 2014 press release, but in a few cases, the targets fought and won, including a Kansas City, Kan., man.

In its two new lawsuits, Sprint has targeted insiders for the first time.

According to the lawsuit against Kummetov, he used FaceBook to recruit Sprint employees and offered to pay the insiders $10 per device to unlock Sprint phones so they could be used on other wireless networks to Sprint’s detriment.

“Kummetov has also attempted or actually made contact with Sprint employees to get assistance unlocking phones,” said the suit filed in U.S. District Court in Kansas City, Kan.

Sprint locks the phones it leases and sells to its customers so the devices will work only on Sprint’s network. It ensures the customers buy and use Sprint’s wireless services and that customers pay for the phones.

Leasing customers repay the cost of the phone during the term of the lease and an additional payment or payments after the lease expires. Customers who buy phones up front pay the manufacturers’ price, Sprint’s suit said, but also agree that the phones can be unlocked only according to Sprint’s policy.

In the Boost Mobile lawsuit, Sprint said it subsidizes the price its customers pay with an expectation of recovering the subsidy through wireless service payments.

Once the phones have been unlocked, Sprint’s suit said, many are resold overseas or used on other companies’ networks.

According to the Kummetov lawsuit, Sprint recently discovered that “unknown customer care support employees or employees of vendor call centers have been unlocking phones for Kummetov (as well as others) and receive payment for doing so.”

Neither lawsuit names the Sprint employees, referring to them as “John Does.” This suggests that Sprint has not been able to learn who they are.

Michael S. Foster, an attorney at the Polsinelli law firm representing Sprint, referred questions to Sprint. Sprint officials did not comment.

Sprint’s lawsuit charges Kummetov and the John Does with tortious interference with contracts or prospective business expectancy and with civil conspiracy. It hits the John Does with four other counts, charging “breach of the duty of loyalty” to Sprint, fraud, violations of the Computer Fraud and Abuse Act and violation of the Digital Millennium Copyright Act of 1988.

The Boost Mobile suit levies similar charges and adds unjust enrichment and federal trademark infringement to the John Does and contributory trademark infringement counts on the John Does and Prasad.

The suits each seek unspecified damages, “permanent injunctive relief” to stop defendants from unlocking phones and other unspecified relief.

This story was originally published December 18, 2017 at 12:04 PM with the headline "Update: Sprint targets more employees in alleged overseas cellphone schemes."