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DirecTV Settles 22-State Probe

The company agrees to pay $5 million and reform its advertising and marketing policies.

December 13, 2005|From Bloomberg News

DirecTV Group Inc., the biggest U.S. satellite television provider, has agreed to pay more than $5 million to settle a 22-state probe of the company's marketing and advertising, New York Atty. Gen. Eliot Spitzer said Monday.

The El Segundo-based company agreed to reform its advertising and marketing policies, said a statement posted on Spitzer's website.

In addition to the $5 million, the company will pay restitution to consumers who complained about cancellation policies and fees, the statement said.

DirecTV agreed to "clearly inform" customers about fees and monthly charges that were in "small unreadable print" and about contract provisions that modified offers or locked in customers, Spitzer said.

The accord is one of several reached with Spitzer this year over consumer marketing claims.

Sony BMG Music Entertainment paid $10 million in July to settle allegations that it bribed radio station programmers to get airplay for its artists.

Warner Music Group Corp. reached a similar pact for $5 million.

Spitzer also settled a suit with Simon Property Group Inc. for $125,000 that accused the company of illegally deducting value from its gift cards when customers didn't use them before a deadline.

A spokesman for DirecTV, Bob Marsocci, did not return a phone call seeking comment Monday.

DirecTV shares rose 3 cents to $13.77.

Besides New York, the other states in the settlement are Delaware, Florida, Georgia, Idaho, Illinois, Kansas, Maryland, Massachusetts, Montana, Nebraska, Nevada, New Jersey, New Mexico, North Carolina, Ohio, Oregon, Pennsylvania, Tennessee, Texas, Vermont and West Virginia.

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