Orion fesses up over Telstra court challenge

Stuart Corner
Sunday, 27 November 2005 16:48

IT Industry - Strategy

Orion Telecommunications has revised a statement to the ASX on the outcome of Telstra's legal challenge over its telemarketing activities after lodging an initial version that was rather sparing with the truth.

In October, Telstra commenced Federal Court proceedings against Orion and its operating subsidiaries in Australia alleging that Orion's sales agents had engaged in misleading telemarketing activity, unauthorised transfer of Telstra customer's services and had been unduly harassing Telstra customers.

Telstra was unsuccessful in obtaining the injunctions it sought against Orion. However Orion was obliged to give the court quite onerous legally enforceable undertakings to redress the type of behaviour detailed in Telstra's allegations.

These undertakings included that it:
- Send senior executives to attend all of its overseas call centres to ensure its staff do not wrongly claim to be associated with Telstra.
- Inform staff and subcontractors who are found to wrongly claim an association between Orion and Telstra that they will be dismissed;
- Retrain staff not to transfer customers without their informed consent such as where the customer has intellectual or language difficulties;
- Keep recordings of conversations between its call centre operators and customers for 20 days;
- Maintain a 'do not call list' and comply with it.

None of this was mentioned in its original statement to the ASX. The company simply said. "Orion has...volunteered to the Court that it will work with all sales agents to maintain, and where necessary make minor adjustments to improve, our quality compliance program. This will be enhanced by an improved verification process."

And  the initial statement quoted CEO, Noel Robertson saying: "We are very happy with this result. We were confident in our case and Telstra's allegations were without any foundation."

In the replacement statement, submitted after Telstra lodged a complaint with the ASX, Orion admitted that there was indeed some foundation to Telstra's allegations.

"...there was evidence that on some occasions, the off-shore telemarketing activities of Orion's engaged sub-contractors supported Telstra's allegations...Further, the evidence also suggested that although Orion's officers, fulfilling the final phase of any transfer of services from Telstra to Orion in the verification department followed a script clearly designed to ensure that there was no misleading of Telstra's customers, nevertheless, on several occasions, the verification officers had apparently ignored the individual intellectual or language deficiencies of customers with whom they were dealing whereby there was an apparent lack of informed consent to the transfer of services."

Having managed to compound a deal of bad publicity by getting a large helping of egg on its face over its less than candid disclosure to the ASX, Orion still had that gall to get in the last word, in its revised statement. "Orion never has wanted to claim any form of relationship with Telstra and wishes to make it clear that it continues in the marketplace as a competitor of Telstra to win thousands of customers because of flexible product offerings, responsive and high quality customer service and a caring attitude to their customers."

Pity they don't treat their prospects the same way.