DirecTV accuses Dish Network retailer of illegal sales ploys
Apparently when it comes to selling satellite TV, anything goes.
In a lawsuit filed in federal court in Sacramento, satellite broadcaster DirecTV accuses Dish One, a retailer majority-owned by rival Dish Network, of using all sorts of duplicitous and illegal acts including pretending to be DirecTV representatives in an effort to poach subscribers, primarily senior citizens.
Dish One has “engaged in marketing efforts to target existing DirecTV customers and convince those customers to switch to Dish Network based on false and misleading representations,†DirecTV said in the suit, which makes allegations of trademark infringement, false advertising, fraud and slander.
DirecTV and Dish are two of the nation’s biggest pay-TV distributors and also bitter rivals. DirecTV, based in El Segundo, has more than 20 million subscribers; Englewood, Colo.-based Dish has about 14 million subscribers.
In a statement, Dish Network said, “we maintain high standards of integrity for ourselves in our interactions with customers, and expect our retailers to do the same.â€
FIRST-PERSON ACCOUNT: Dish, DirecTV and me
Dish One -- whose chief executive, Michael Hammond, is named in the suit -- did not respond to requests for comment. DirecTV declined to comment beyond the suit.
The suit details several instances of a Dish One representative persuading senior citizens to unwittingly drop DirecTV for Dish in the Sacramento area.
One of the ploys Dish One representatives are accused of using to try to get subscribers to drop DirecTV was to say the two companies had merged. Then the Dish One representative would offer service upgrades that in reality were contracts to drop DirecTV in favor of Dish, the suit said. To further sell the ruse, it said, representatives would wear shirts bearing the logos of both companies.
DirecTV also details a Dish One training video it obtained that, it said, shows how the retailer has encouraged fraudulent behavior as a way to win customers. It said that besides pretending to represent both companies through wardrobe and notebooks with a DirecTV logo, the representative would often badmouth and make inaccurate statements about DirecTV.
If Dish One was successful in wooing a customer away from DirecTV, it would then call DirecTV and claim to be the customer or their representative and cancel the service, often by pretending to be military personnel who had received deployment orders, the suit said. DirecTV does not charge customers a penalty for breaking their contracts early if they are in the military. Using that tactic also enabled Dish One to cover its own tracks, the suit says.
“Without the facade created by defendants, DirecTV would have continued to charge the victims of Dish One Sales Force’s scheme subscription fees or cancellation fees for ending their relationship with DirecTV. Instead the customer appears to switch from DirecTV to Dish Network without penalty or interruption, furthering the false impression that the Dish One sales force works for DirecTV and/or that DirecTV and Dish Network are the same company,†the suit said.
Dish and DirecTV have often been seen as candidates for a potential merger. Dish Chairman Charlie Ergen and DirecTV CEO Mike White each have indicated in the recent past that a merger between the two could make sense.
If it does ever happen, the new entity may already have company shirts ready to go.
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Follow Joe Flint on Twitter @JBFlint.
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