ADT wins first round against Capital Connect
BOCA RATON, Fla.—A U.S. District Court granted ADT’s request for a preliminary injunction against Capital Connect, a Monitronics alarm dealer, barring the company and its sales force from allegedly making false claims to ADT customers. The next step will be to take the case to trial, David Bleisch, ADT general counsel, told Security Systems News.
ADT sued Capital Connect, claiming it told ADT customers it was affiliated with ADT or that their alarm systems needed to be upgraded.
Capital Connect is headquartered in Tucson, Ariz., and operates in Arizona, California, New Mexico, Texas, Colorado, Utah, Nevada and Idaho. It provides residential and commercial security and home automation.
“Capital Connect does not condone or in any way encourage any false or misleading practices by its sales representatives. As the court’s preliminary ruling acknowledges, Capital Connect employs copious measures—such as training materials, sales ethics agreements and quality assurance calls—to ensure ethical and truthful sales practices. The court’s ruling is only preliminary, and Capital Connect looks forward to the opportunity to defend its sales practices at a full trial,” Andres Correa, who represents Capital Connect in the lawsuit, told SSN in an emailed statement. He is with the law firm Lynn Tillotson Pinker & Cox, based in Dallas.
ADT has also filed suit against four other Monitronics alarm dealers.
ADT tracks a number of complaints and prioritizes them based on companies, Bleisch said. It filed the suit against Capital Connect in July. ADT says hundreds of its customers have complained that other companies tried “to swindle” them into signing new contracts.
“ADT is committed to taking action to stop these shameful sales practices by bad actors in our industry,” he said. “We will continue the battle against companies where deceptive sales practices flourish to help protect consumers from falling prey to such swindlers.”
ADT gave a press conference on the topic of deceptive sales practices at this year’s ESX.
“One of the things doorknockers are doing today is lying to get foot in the door. This [ruling] is recognition that that line to get your foot in the door is a deceptive action in and of itself, even if you attempt to clarify it later on,” he said.
Over the past three years, ADT has received nearly $6 million in settlements against companies that have made false or misleading statements while selling security services door-to-door. ADT also obtained court orders prohibiting the companies from using any further deceptive sales practices.
The BBB reported that complaints about home security systems ranked 25 out of the 3,500 business categories it tracked in 2014, ADT said in its announcement about the preliminary injunction.
ADT Corporation says it has nearly 7 million customers.