December 13, 2005
DirecTV to settle sales charges: FTC
WASHINGTON (Reuters) - The U.S. Federal Trade Commission
said on Tuesday that DirecTV Group Inc. would pay $5.3 million
to settle charges that the satellite television operator had
violated the FTC's rule against calling people who have asked
not to receive sales calls.
The FTC said it was the largest civil penalty the agency
has ever announced in a case enforcing a consumer protection
A complaint filed in federal court in Los Angeles by the
FTC names DirecTV and five firms that conducted telemarketing
on its behalf for calls made to consumers listed on the
national "do not call" registry.
Settlements with DirecTV and two of the telemarketing firms
and their principals were filed along with the complaint.
"This multimillion dollar penalty drives home a simple
point: Sellers are on the hook for calls placed on their
behalf," FTC Chairman Deborah Platt Majoras said in a
DirecTV, the top U.S. satellite TV company, denied any
violation of the telemarketing sales in court papers but said
it wanted to settle the charges.
In a news release, DirecTV said the majority of complaints
the FTC received were related to calls placed by a small number
of former independent retailers who ignored DirecTV policies
prohibiting unauthorized telemarketing.
"DirecTV has agreed to continue to closely monitor
independent retailers to ensure that their telemarketing
practices comply with the law and DirecTV's polices," the
DirecTV shares were barely changed at $13.76 on the New
York Stock Exchange.
Separately, New York Attorney General Eliot Spitzer said on
Monday that DirecTV had agreed to pay $5 million to 21 states
to settle an investigation into it's marketing and advertising
Spitzer's investigation started in March 2003 after the
states got complaints from customers who could not view some
blacked-out programs, including sports events. Others said they
could not receive all the local channels that they had expected
The company also charged an early termination fee for
customers who signed up for a free programing trial offer but
then backed out before the programing period expired, Spitzer's