AT&T has proposed a settlement that will end several class action lawsuits that surrounds the software locks on most AT&T phones. These locks are put in place to prevent AT&T phones from operating on other compatible wireless carriers.

Each of the four lawsuits, in some shape, form or fashion claim it is improper for AT&T to sell phones that have been programmed not to operate on compatible services and that this restriction hasn't been properly disclosed to customers (still scratching my head on the latter claim).

The proposed settlement allows customers owning eligible phones who have completed a minimum of 90 days of active service with AT&T and be in good standing, upon request, receive an unlocking code. Phones that have an exclusivity sales contract with AT&T of ten months or longer (e.g. the iPhone) are excluded from this settlement. Phones with an exclusivity sales contract of less than ten months the exclusive period mush have expired before the unlocking code is released.

Customers are limited to five unlock codes per year and AT&T will pick up the attorney's fees, on the litigation, up to $5.7 million. The settlement proposal now goes to those suing AT&T to allow anyone not interested in the proposal to opt out or object to the terms. The Court will determine whether or not to approve the settlement on July 2, 2010. 

No word if this includes or excludes Windows Phones such as the Tilt2, Samsung Jack and Pure. While these phones are offered by other carriers, the name is unique and possibly exclusive to AT&T.  While one can hope that this might lead the way for more unlocked phones to appear in the U.S. market, one also has to wonder if this development is related in any way to AT&T recently increasing their early contract termination fees?