Multi-state agreement settles allegations of deceptive advertising and sales; requires company to substantially change business practices
Attorney General John Kroger today announced a $13.25 million multi-state agreement with DIRECTV, Inc., one of the nation’s largest providers of satellite television services. The settlement resolves allegations that the company engaged in deceptive, unfair and unlawful sales practices in violation of Oregon consumer protection law.
Oregon was a member of the multi-state Executive Committee that led the investigation into DIRECTV’s sales and advertising tactics, including its promotional “cash back” and rebate offers.
“Telecommunications companies consistently rank No. 1 on the Department of Justice’s Top 10 Consumer Complaints list,” said Attorney General Kroger. “For that reason, protecting consumers from telecommuncations fraud is one of our top consumer protection priorities.”
DIRECTV is one of the single largest generators of consumer complaints, with over 1,020 filed with the Oregon Department of Justice since 1996 and more than 230 so far this year. A majority of complaints pertain to the company’s failure to clearly and conspicuously disclose certain fees, contract terms and other hidden limitations that applied to their subscription. Many consumers also complained about DIRECTV’s practice of automatically enrolling them in additional or extended contracts without their full knowledge.
Oregon will receive $605,000 under the agreement to be filed today in Marion County Circuit Court, part of which will be used to cover the costs of the investigation. Among other things, the settlement terms require DIRECTV to make significant reforms to its business practices, including more transparent disclosure of terms and conditions that apply to consumer contracts.
The company has also agreed to pay restitution to certain consumers with unresolved complaints filed since Jan. 1, 2007. Eligible consumers will be contacted directly by DIRECTV over the next several months. Consumers who have not filed complaints have until June 9, 2011 to do so. Consumer complaint forms are at https://www.doj.state.or.us/finfraud/engexplanation.shtml. Consumers also can call the Attorney General’s Consumer Hotline at 1.877.877.9392 between 8:30 and 4:30 M-F to request that a form be mailed to them. DIRECTV will attempt to resolve the complaints directly with consumers. If a complaint deemed eligible cannot be resolved, DIRECTV shall inform the consumer that the complaint can be resolved by a Claims Administrator and will mail a Claim Form to the consumer for further review of the complaint.
Attorney General John Kroger leads the Oregon Department of Justice. The Department’s mission is to fight crime and fraud, protect the environment, improve child welfare, promote a positive business climate, and defend the rights of all Oregonians.
Contact:
Tony Green, (503) 378-6002 tony.green@doj.state.or.us