Washington state sued Comcast for more than $100 million Monday, alleging that the company committed 1.8 million violations of the state's Consumer Protection Act, including misrepresenting the scope of its service protection plan, charging customers improper service call fees and using improper credit screening practices.
Charging the 1.8 million violations, State Attorney General Bob Ferguson is seeking refunds for more than 400,000 people in the state, according to a statement from the AG issued Monday. Comcast Corp. (Nasdaq: CMCSA, CMCSK)'s "own documents reveal a pattern of illegally deceiving their customers to pad their bottom line by tens of millions of dollars," according to the AG's statement.
The lawman says:
The lawsuit also accuses Comcast of violating the CPA with all of its nearly 1.2 million Washington subscribers due to its deceptive "Comcast Guarantee."
The lawsuit is the first of its kind in the nation -- though the Service Protection Plan is a nationwide program and many of the improper practices are used in all of Comcast's markets. The state Attorney General's Office brought these issues to Comcast over a year ago, but the company didn't begin to make changes until recently -- on the verge of this litigation.
"This case is a classic example of a big corporation deceiving its customers for financial gain," Ferguson said. "I won't allow Comcast to continue to put profits above customers -- and the law."
The lawsuit claims Comcast misled 500,000 Washington consumers into paying at least $73 million in subscription fees "over the last five years for a near-worthless 'protection plan' without disclosing its significant limitations," the statement says. The plan charges $4.99 per month to avoid charges for site visits by a technician for covered repairs. Comcast claimed the "comprehensive" plan covered all service calls, but didn't disclose that it doesn't cover "wall-fished" wiring, inside a wall, which constitutes the vast majority of wiring inside homes, the AG statement says.
The lawsuit also charges Comcast with improper fees for services that should have been free. And Comcast's improper credit screening unnecessarily impacted credit reports of customers, the attorney general's statement said.
Comcast is "surprised and disappointed" by the lawsuit, according to a statement emailed to Light Reading. The statement says:
The Service Protection Plan has given those Washington consumers who chose to purchase it great value by completely covering over 99% of their repair calls. We worked with the Attorney General's office to address every issue they raised, and we made several improvements based on their input. Given that we were committed to continue working collaboratively with the Attorney General's office, we're surprised and disappointed that they have instead chosen litigation. We stand behind our products and services and will vigorously defend ourselves.
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— Mitch Wagner, , Editor, Light Reading Enterprise Cloud