DirecTV agrees to pay state $1 million, repay customers over ads, business practices

DirecTV agreed to pay the state Attorney General's office $1 million to settle a lawsuit alleging unfair business practices that prompted about 2,000 consumers to lodge complaints against the firm in Washington state alone.

The nation's largest satellite TV provider also agreed to pay restitution to Washington consumers who have unresolved complaints against the company.

On Tuesday, the company also announced settlements with 49 other states and the District of Columbia over complaints of false and misleading advertising, and contract terms that consumers say were hidden in small print, or not disclosed when they purchased equipment to run the service.

In announcing the settlement, the company issued a statement saying, "DirecTV is committed to always operating with the highest standards of integrity and will move forward with continued dedication to providing the best video experience possible for our customers."

In suing the company last year in King County Superior Court, Washington Attorney General Rob McKenna alleged the company had "built deception into their business model," and alleged a host of "unconscionable" business practices

Washington was the first state to sue the company after trying for several months to resolve complaints, said Paula Selis, senior counsel with the attorney general's office and lead attorney in the suit. "A lot of this lawsuit is about changing their advertising practices," said Selis. Among other things, the company would advertise a low monthly price, but hide in "mice-type," the fact that it was a promotional price good for only one year of a two-year contract, and that it required customers to file rebates.

Also hidden in small type, Selis said, were hefty "early termination fees," charged, in some cases, to people who could not even receive the services for which they were being billed.

The settlement requires DirecTV to "clearly and conspicuously" disclose the terms of service in relation to pricing so that people know it's a promotion that requires them to file a rebate.

Selis said the AG began receiving complaints about the firm in 2006. She said the company began voluntarily changing its advertising in 2009 in response to inquires by attorneys general throughout the country.

Selis said the settlement, to be filed Thursday, should send a cautionary warning to any company relying on small print to communicate with consumers.

Washington consumers who would like to obtain restitution for practices covered in the suit must have an outstanding complaint against the company that was filed after Jan. 1, 2007, but before May 31, 2011.

To file a complaint, contact DirecTV customer service at 1-800-531-5000 or go to support.directv.com/app/ask. Complaints also may be filed with the Washington state Attorney General's office online at www.atg.wa.gov/fileacomplaint.aspx or by calling 1-800-551-4636.