Illinois shares in DirecTV settlement

By Bruce Japsen
Posted Dec. 15, 2010 at 1:52 p.m.

DirecTV Group Inc. has agreed to pay $13.3 million in civil penalties and costs, including $185,000 to the state of Illinois, to settle allegations that the satellite-TV service provider used misleading sales and marketing practices.

California Attorney General Edmund Brown alleged the company offered special deals that had hidden costs and extended customers’ contracts without notifying them. The company also allegedly failed to deliver promised channels and changed the terms of some promotions.

Under the settlement, which also includes restitution to customers, DirecTV has agreed to change its sales and advertising practices, Brown said. The state of Illinois will get $185,000 that will be set aside in a consumer education fund, Illinois Attorney General Lisa Madigan’s office said.

“Consumers need to know the exact details of their contract before they sign up,” Madigan said in a statement. “This settlement requires that DirecTV provide that information to consumers.”

The company has 18 million subscribers in the U.S., including more than 1 million in California, according to the attorney general’s office. The settlement covers complaints about the company’s practices since January 2007.

In a statement Tuesday, DirecTV Chairman and Chief Executive Mark White said, “DirecTV has worked hand-in-hand with the attorneys general to formalize many of the customer improvements we have made over the past few years and are pleased to have come to this agreement.”

DirecTV last month reported higher third-quarter earnings and added subscribers. Its results ran counter to cable providers, which have reported declines in video subscribers lately.

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