Sirius XM Radio to Pay $3.8 Million in Multistate Settlement Over Misleading Ads and Billing Practices
Massachusetts to Receive More than $80,000; Sirius XM to Provide Restitution to Eligible Consumers
BOSTON – Resolving claims that the satellite radio company engaged in misleading advertising and billing practices, Sirius XM Radio Inc. of New York has agreed to pay a total of $3.8 million and provide restitution to eligible consumers, Attorney General Martha Coakley announced today. The settlement will bring more than $80,000 to the Commonwealth.
AG Coakley has joined 44 other states and the District of Columbia in the settlement with Sirius XM, resolving allegations that the company engaged in misleading, unfair, or deceptive acts or practices in violation of state consumer protection laws.
The states’ investigation focused on consumer complaints involving: difficulty canceling contracts; failing to honor cancellation requests; misrepresenting to consumers that Sirius XM services would be canceled and not renewed; automatically renewing contracts without notice to the consumers or their consent; charging unauthorized fees; unanticipated price increases after a low introductory price; and failing to provide timely refunds.
Under the terms of the settlement, Sirius XM will make significant changes to its business practices. Specifically, Sirius XM agrees to:
- Clearly and conspicuously disclose all terms and conditions at the point of sale, such as billing frequency, term length, automatic renewal date, and cancellation policy;
- Make no misrepresentations about the available plans in advertisements;
- Provide advance notice via mail or email about upcoming automatic renewals for plans lasting longer than six months;
- Revise the cancellation procedures to make it easier for consumers to cancel;
- Prohibit incentive compensation for customer service representatives based solely on “saves,” or retaining current customers who attempt to cancel.
In addition to the $3.8 million payment, Sirius XM will provide restitution to eligible consumers who have experienced the problems addressed in today’s settlement. Consumers who have not previously filed a complaint with the AG’s Office for the practices covered by this settlement have 150 days after the settlement’s execution date to file a complaint to be considered for restitution.
Consumers in Massachusetts who have a complaint regarding Sirius XM’s business practices addressed by this settlement are urged to contact the Attorney General's consumer hotline at (617) 727-8400 or visit the website. The settlement covers conduct of Sirius XM that occurred between July 28, 2008 and December 4, 2014. Consumers may be entitled to restitution if they had a billing issue that was not previously resolved.
The states participating in the settlement include: Alabama, Alaska, Arizona, Arkansas, Colorado, Connecticut, Delaware, Georgia, Idaho, Illinois, Indiana, Iowa, Kansas, Kentucky, Louisiana, Maine, Maryland, Massachusetts, Michigan, Minnesota, Mississippi, Missouri, Montana, Nebraska, Nevada, New Hampshire, New Jersey, New Mexico, North Carolina, North Dakota, Ohio, Oklahoma, Oregon, Pennsylvania, Rhode Island, South Carolina, South Dakota, Tennessee, Texas, Utah, Vermont, Virginia, Washington, West Virginia, Washington, D.C., and Wisconsin.
Assistant Attorney General Jeffrey Walker handled the settlement for the Commonwealth, with assistance from Assistant Attorney General Gillian Feiner, both of the Attorney General’s Consumer Protection Division, along with the Attorney General’s Public Inquiry and Assistance Center.