FTC: AT&T Should Pay $4 Billion for False DirecTV Advertising

The FTC this week proclaimed that AT&T should be forced to pay $3.95 billion to settle a false advertising lawsuit filed against AT&T's DirecTV division back in 2015. As we noted then, DirecTV found itself under fire for deceptively advertising a discounted 12-month programming package that failed to disclose the need for a two-year contract, or the fact that the agreement bumped rates by as much as $45 in the second year of the agreement. Traditionally, most promotions make these kinds of strings notably clear.

As the trial opens this week in Oakland, FTC officials stated that the fine was a rough estimate of how much money DirecTV made from the misleading promotion. For its part, an AT&T lawyer at the trial called the FTC's estimate "absurd," and questioned whether consumers were actually misled.

“How can a customer who’s coming back be deceived?” asked AT&T lawyer Jeff Tillotson, apparently trying to tap dance around DirecTV's failure to clearly highlight the caveats of the promo.

"That's a lot of money, but it is because DirecTV's conduct affected a lot of people,” an FTC lawyer tells Law360.

FTC enforcement of this sort of behavior is historically inconsistent, something the countless misleading fees used to covertly jack up broadband and TV prices should make clear. Both broadband providers and cable TV operators routinely make up a rotating crop of misleading fees to let them advertise one rate then charge another, but you'd be pretty hard pressed to find a regulatory agency -- under either party's leadership -- that cares.