As one of the biggest companies in the world, AT&T has no shortage of issues to deal with, and when some big problem happens to one of the many companies beneath the brand umbrella, it can go all the way to the top. Such is the case with the now-in-motion deceptive advertising trial that is pitting the U.S. Federal Trade Commission against AT&T's DirecTV. The two powerful forces have been preparing to go to trial for awhile now, but eyebrows in the courtroom likely hit the ceiling this week when the FTC, in its opening statement, claimed the service provider caused $3.95B in damages to consumers.
It's not every day that numbers that high are thrown around, even in court where most litigants ask for huge amounts of money, but that's what happened in Oakland's U.S. District Court during the ongoing case between the FTC and the cable giant. The FTC's attorney Jacob A. Snow alleges that many customers signed up for DirecTV service between 2007-2015 and entered into a contract under pretenses they were unaware of. Basically, at the time, DirecTV was running print ads for its 12-month fixed-rate promotional plan, and the FTC feels the company wasn't very clear about a two-year contract being required, or that multiple rate hikes and early cancellation fees were a possibility. Further, the FTC claims the company's website makes relevant fine print hard to access, according to Law 360, and Snow says that the company made $3.95 billion through such advertising tricks.
Of course, DirecTV's legal head Jeff Tillotson claims that dollar amount is pretty ridiculous, and that the company isn't guilty of duping customers. He claimed DirecTV's website makes the price increases and other relevant info quite apparent, and that they come up throughout the order process.
It was over two years ago when these issues first came up -- right around the time Rob Lowe got canned by the satellite company -- and it seems like the customer complaints central to the case have only gotten worse in the meantime. Earlier this year, CBS News discovered thousands of complaints from people having the same issues, and pointed out how the agreements involved with DirecTV's contracts state that customers need to use an arbitrator for litigious complaints, although very few have actually done so.
The current trial is expected to last 20 days. U.S. District Judge Haywood S. Gilliam, Jr. is hearing the case alone, without a jury involved, so it'll be up to him to make the final call. It's very unlikely DirecTV, or its parent company AT&T, will end up with a bill that high; however, any lawyer will tell you it's impossible to predict exactly how a trial will go.
Will AT&T and DirecTV be forced to pay nearly $4 billion for supposedly fraudulent negotiations? One might not suspect it would go that far, but stranger things have happened in courtrooms. While waiting to hear about where this case is going, DirecTV and DirecTV Now customers would be wise to check out the Audience Network exclusive drama Mr. Mercedes, and then head to our summer premiere schedule and our fall TV schedule to see all the new and returning shows hitting the small screen soon.
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Nick is a Cajun Country native, and is often asked why he doesn't sound like that's the case. His love for his wife and daughters is almost equaled by his love of gasp-for-breath laughter and gasp-for-breath horror. A lifetime spent in the vicinity of a television screen led to his current dream job, as well as his knowledge of too many TV themes and ad jingles.