Office of the Attorney General
Attorney General Conway Announces $13 Million Settlement with DIRECTV

Attorney General Jack Conway announced today that DIRECTV, Inc. will pay more than $13 million to settle allegations of deceptive and unfair sales practices. The settlement resolves claims made by General Conway and the attorneys general in 48 other states and the District of Columbia. DIRECTV will also provide a claims process to offer restitution to eligible consumers.

Kentucky's share of the overall settlement is $185,000, of which, $37,000 will go toward investigative costs.

The states alleged the satellite television provider and its third-party retailers engaged in deceptive and unfair sales practices by failing to clearly disclose pricing and term requirements and enrolling consumers in additional contracts without disclosing the terms.

In addition to the $13.25 million to be paid to the participating states and the separate claims process for consumer complaints, DIRECTV entered into an agreement that limits how it can market services in the future. The agreement, known as a Consent Judgment and Permanent Injunction, has been tendered to the Franklin Circuit Court.

"I am pleased to announce the settlement today and to announce the possibility of consumer restitution for eligible consumers," General Conway said. "My office is committed to protecting Kentucky consumers from companies that engage in deceptive or misleading business practices."

The settlement resolves the states' various allegations, including that DIRECTV:

• Did not clearly disclose to consumers the price that would be charged and the commitment term required to keep DIRECTV services;
• Did not clearly disclose to consumers limitations on certain advertised prices for DIRECTV;
• Enrolled consumers in additional contracts or contract terms without clearly disclosing the terms to the consumer;
• Enrolled consumers in additional contracts when replacing defective equipment;
• Did not clearly disclose to consumers that a seasonal sports package was automatically renewed; and
• Offered cash back to consumers when the consumer would actually receive bill credits.

The settlement requires DIRECTV to:

• Clearly disclose all material terms to consumers;
• Replace leased equipment that is defective at no cost except shipping costs;
• Eliminate requirements that the consumer enter into an additional contract when simply replacing defective equipment;
• Clearly disclose when a consumer is entering into a contract;
• Clearly notify consumers before a consumer is obligated to pay for a seasonal sports package;
• Clearly disclose all limitations on the availability of local channels;
• Accurately represent the availability of sports programming;
• Accurately represent whether a consumer will get cash back or if the consumer would actually get a bill credit; and
• Clearly notify consumers that they will be charged a cancellation or equipment fee at least 10 days before charging the fee.

CONSUMER REFUNDS

Unresolved complaints sent to DIRECTV or the Attorney General that involve conduct addressed in the settlement and occurring after January 1, 2007 are eligible for the restitution program. Consumers can file a complaint with DIRECTV or the Attorney General by June 9, 2011 to be considered for the restitution program as long as the complaint is about activity that occurred after January 1, 2007.

Complaints may be made at DIRECTV's website at www.directv.com/ag or by downloading and filing a complaint with the Office of the Attorney General. A general consumer complaint form may be obtained at http://ag.ky.gov/civil/consumerprotection/complaints/ or consumers can call 502-696-5389 and ask that a complaint form be mailed to them. Consumers who previously filed a complaint with the Attorney General do not need to re-file their complaint.