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Federal Prosecutor: DirecTV Owes Customers Nearly $4 Billion For Deceptive Ads

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Federal Prosecutor: DirecTV Owes Customers Nearly $4 Billion For Deceptive Ads

DirecTV is on trial in federal court for allegedly deceiving its customers about the cost of their satellite subscriptions, and the U.S. Federal Trade Commission wants the company to cough up $3.95 billion in restitution.

The trial kicked off Monday with opening arguments in U.S. District Court in Oakland, California, and is scheduled to last 20 days.

FTC lawyer Jacob A. Snow said between 2007–2015, DirecTV signed up 33 consumers who had been duped by print ads that didn’t clearly disclose that rates would climb after three months, then after a year, and that the company would charge an early cancellation fee.

Snow also argued that the satellite television provider also buried those terms in fine print on its website. DirecTV made $3.95 billion as a result of those deceptive practices, he said, according to Law360.

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DirecTV’s Marketing Violated FTC Rules, Prosecutor Says

"That's a lot of money, but it is because DirecTV's conduct affected a lot of people,” Snow told U.S. District Judge Haywood S. Gilliam Jr., who is hearing the case without a jury and will render the final decision.

DirecTV lawyer Jeff Tillotson said that the FTC’s restitution estimate is “absurd.” He argued that DirecTV clearly discloses the price increases in multiple places on its website throughout the purchasing process, and the FTC.

The FTC sued against DirecTV, which since then was acquired by AT&T Inc. (NYSE: T) in March 2015, alleging that DirecTV’s marketing campaign for its two-year contract violated the FTC rules by not clearly disclosing its terms.

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Image Credit: By Dwight Burdette (Own work) [CC BY 3.0 (http://creativecommons.org/licenses/by/3.0)], via Wikimedia Commons

Posted-In: DIRECTV Federal Trade Commission FTC Haywood GilliamNews Legal Media General Best of Benzinga

 

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