Why Consumer Complaints Lead to DIRECTV Paying $14 Million in Damages

List: Posted: 09/19/11

DIRECTV is one of the two most popular companies for satellite TV service.  However, all companies have a few issues, and it seems that DIRECTV's issues were sufficient for a massive number of complaints and lawsuits to be filed.  So what were these problems, and how will they affect the company?


The short answer is that DIRECTV was ordered by the US courts to pay $14 million in restitution to current and previous customers.  DIRECTV was accused of several unethical practices by their customers, including their underhanded cancellation policies that resulted in customers paying enormous fees just to be rid of a service they did not want in the first place. 


Other problems included a variety of other consumer protection issues.  One of the most notable plaintiffs against DIRECTV was the Washington Attorney General, whose office won $1 million on their own settlement.


Other than the financial payout, the direct result of the DIRECTV case is that the company is now bound to follow several key practices during their daily business and interaction with their customers.  DIRECTV is now unable to impose cancellation fees on accounts where the reason for cancellation is a recurring problem that cannot be fixed by the company. 


In addition, DIRECTV must be clearer with their rebates, promotions and in their pricing information in their advertising and promotions.  This is not the first time that DIRECTV has had these problems in court, and it will be interesting to see if the company makes good on the new requirements. 

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