Dish Network, L.L.C., will pay $2 million as part of a settlement reached with Colorado Attorney General John Suthers on Friday following allegations of deceptive or misleading sales practices.
The satellite television provider allegedly misled customers into believing they were locked into a fixed price for the duration of their contracts with the company.
As part of the settlement, $1 million will go to the state’s general fund to pay back customers, while the remainder will go to the attorney general’s custodial fund, which is used to conduct investigations.
The attorney general's office received numerous complaints about Dish Network in 2011 after the company started raising premiums by an average of $5 during the second year of customers' contracts.
“Customers were upset to see their price raised after DISH sales agents pledged contract rates were ‘locked in,’ ‘frozen,’ or ‘guaranteed’ and in some cases that prices would never change,” Suthers said.
Based on the complaints, Suthers' office reviewed Dish Network's oral sales script and found that the company had removed the disclaimer that "prices were subject to change."
As part of the settlement, DISH also will change its sales scripts to inform customers that rates can be increased at any time.