The Federal Trade Commission is taking on the nation’s largest satellite television provider, saying it conned consumers into paying more for their TV service.
The FTC is suing DirecTV for deceptively advertising a reduced-price 12-month satellite programming package, the agency said in a press release. The commission said the satellite giant failed to clearly disclose that the package came with a two-year contract.
“In addition, DirecTV does not clearly disclose that the cost of the package will increase by up to $45 more per month in the second year, and that early cancellation fees of up to $480 apply if consumers cancel the package before the end of the two-year period,” the FTC said.
The commission said DirecTV also didn’t disclose that after the time ran out on its three-month free premium channel offering, it would automatically charge customers’ credit or debit cards for the channels. Customers were expected to call and cancel the premium channels beforehand.
The alleged deceptive activities date back to 2007. FTC chairwoman Edith Ramirez said in a statement:
DirecTV misled consumers about the cost of its satellite television services and cancellation fees. DirecTV sought to lock customers into longer and more expensive contracts and premium packages that were not adequately disclosed. It’s a bedrock principle that the key terms of an offer to a consumer must be clear and conspicuous, not hidden in fine print.
The FTC is asking a federal court in California, where the complaint was filed, to bar DirecTV from similar activity in the future and require that the company provide refunds to consumers.
DirecTV has denied the FTC’s charges, The Associated Press reports.
“[DirecTV] says it’s made a number of improvements to make the ordering process as clear as possible, eliminated some promotions that may have been confusing to consumers, and prominently disclosed introductory pricing terms,” the AP said.
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