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FTC Files Lawsuit Against DirecTV for False Advertising

According to DirecTV’s annual report to investors the company made an attempt to settle a case with the Federal Trade Commission concerning false advertising practices. The FTC declined the settlement though and went ahead with filing a lawsuit seeking monetary damages from DirecTV for their actions.

The lawsuit filed by the FTC in federal court claims that DirecTV’s one year discounted rate plans do not let the customer know that they require a two year contract. The lawsuit also claims that the customer is not made aware about the huge increase in the monthly price that occurs after the 12 month discounted rate period ends. After this period has ended, customer bills increase as much as $45.00 per month.

The FTC also points out in their lawsuit that once the contract begins, it will cost a customer $480.00 in early termination fees to cancel the contract. People are only made aware of the price increase after the contract begins, and they are also not made aware of the early termination fee until after signing up. Both of these practices are considered illegal and entrapping by DirecTV because of the false nature of their advertisements concerning this promotional offer.

The Federal Trade Commission is seeking to get a federal judge to sign a court order that would permanently stop DirecTV from using these illegal and immoral business practices. The FTC’s lawsuit is also seeking the courts to hand down a sizeable financial penalty that can be used to refund DirecTV customers. The government also realizes that one way to ensure a large corporation discontinues these types of practices is to hurt them where they truly notice it, their bank accounts.

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