A class action lawsuit alleging that DirecTV imposes early "termination fees" of up to $480 on customers who cancel the service--often charging the customer's bank account or credit card directly without their permission--has been cleared to proceed by a California Superior Court judge.
The complaint, filed in Los Angeles Superior Court in September 2008 by Los Angeles resident Kathy Grenier, claims that when Grenier cancelled her DirecTV contract due to a malfunctioning receiver, she was hit with a $240 termination fee, withdrawn directly from her checking account. Grenier's suit was later consolidated with another suit brought by fellow California residents Amy Imburgia and Marlene Mecca.
That suit, Imburgia, et. al, v. DirecTV, Inc., alleges that DirecTV failed to disclose that it had mandatory contract "terms of service," and that cancelling the service ahead of time would incur termination fees. DirecTV, much like cell phone companies, would also use instances of replacing equipment or making changes to the service to automatically extend the customer's contract. The suit alleges that the practices were not disclosed to customers beforehand.
"This is a major step forward in our mission to obtain justice for California consumers cheated by DirecTV," said Consumer Watchdog founder Harvey Rosenfield, who, along with Litigation Director Pamela Pressley, is one of the attorneys in the case.
"California consumers who continue to have their bank accounts plundered without their consent by DIRECTV deserve their day in court, and the court's recent ruling will allow the plaintiffs to move forward with uncovering and exposing the extent of DirecTV's deceptive practices," said Ms. Pressley.
According to Consumer Watchdog, DirecTV had requested that the California case be stayed while federal cases against DirecTV, filed in both California and other states, were considered. Under the tactic of preemption, companies will often prefer to fight battles on the federal level in order to block stronger state laws from taking effect.