Class action claims DirecTV cancellation fees are confusing, deceptive

Michelle Massey, East Texas Bureau Feb. 9, 2010, 8:31am

TEXARKANA, Ark. -- A DirecTV customer believes the satellite television programming contract she signed is so confusing and difficult to read that it is not enforceable under Arkansas law and wants her early cancellation fee refunded.

The Arkansas resident filed a class action seeking the return of monies paid to DirecTV for the Early Cancellation Fee of its satellite television programming services, arguing that the fee violates Arkansas law by holding customers hostage with an unenforceable contract.

Alleging violations of the Arkansas Deceptive Trade Practices Act, individually and on behalf of an Arkansas class of similarly situated people, Jo Murray filed suit against Pro Sat and Home Entertainment and DirecTV Inc. on Jan. 13 in the Miller County Circuit Court of Texarkana, Ark.

The Arkansas Deceptive Trade Practices Act is designed to protect consumers from deceptive, unfair and unconscionable trade practices.

The class action alleges that the provisions regarding the fee are not adequately communicated to customers.

Murray states that she decided to purchase DirecTV service and have it installed by defendant Pro Sat in January 2007. By March, she claims that she was "tremendously frustrated with the cumbersome nature of DirecTV's system and controls" and she attempted to terminate the satellite service. To cancel the service, DirecTV demanded payment of its $137 as an early cancellation fee that it claimed Murray had agreed to.

Murray claims she was never told about such a fee and did not believe that she owed it, but she involuntarily paid it to cancel the satellite service. The plaintiff states that she was coerced into paying after DirecTV's representatives said that she had a contract and if she refused to pay they would take legal action and report her as a bad credit risk to credit bureaus.

According to the lawsuit, "defendants have engaged in unconscionable and deceptive business practices that have caused Plaintiff and the Class to pay them unlawful penalties related to what Defendants call 'Early Cancellation.'"

Although the fee is detailed in the contract for the satellite television service, the lawsuit states that the fee is not related to the actual costs of service but is instead designed as an "illegal penalty to hold customers hostage."

The plaintiff argues that the contract is not mutually beneficially but written only to favor the defendants and is presented on a "take it or leave it basis" and is not subject to negotiation.

Further, the plaintiff states that the "uniform documents used by Defendants are contracts of adhesion that are purposely drafted to be confusing, and so difficult to read and discern to encourage Plaintiff and Class members to never read them."

According to the lawsuit, the documents are printed in such small print that it is necessary to use a magnifying glass to read them and some parts of the contract are only available on the Internet instead of provided by the retailer or installer at the point of sale.

The lawsuit argues that the defendants have denied a copy of the contract to many consumers, informing the consumers that they do not have those documents, do not have to provide them or simply ignoring the request.

Murray maintains that the standardized "contract" allows the Defendants to increase subscription fees, change programming, charge hidden fees, reserve all their legal rights and remedies and maximize liability and potential recovery while limiting the consumer's rights and remedies.

Seeking up to $5 million, the class action seeks compensatory damages ranging from $100 to $500 on an individual basis, pre and post-judgment interest, punitive damages and attorneys' fees.

The plaintiff is asking the circuit court to prohibit DirecTV from continuing to charge the fee.

Class counsel includes Little Rock attorneys Scott Poynter, Jack Patterson, Christopher Jennings and Gina Dougherty; Houston attorney John G. Emerson from the law firm of Emerson Poynter LLP; and Arkadelphia attorney Todd Turner and Dan Turner of Arnold, Batson, Turner and Turner P.A.

Miller County Circuit Judge Kirk Johnson is assigned to the litigation.

In the United States, DirecTV is the largest direct to home satellite television provider with over 16.8 million subscribers. DirecTV is also the second largest multi-channel video programming provider.

The court documents allege that scores of customers in various states have complained about the early cancellation fees to attorneys general, Better Business Bureaus and other consumer advocate Web sites.

After he received more than 700 consumer complaints in three years, Washington's Attorney General Rob McKenna filed a lawsuit against DirecTV for deception and unfair business practices. McKenna alleges that DirecTV "lured customers with ads for low-priced service, while burying multiple hidden fees and 'gotchas' in the fine print."

Case No CV-2010-0012-3

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