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Illinois alarm industry helps quash onerous proposals

Ordinances to get communities into the fire-alarm monitoring business fizzle after industry raises concerns

ARLINGTON HEIGHTS, Ill.—The security alarm industry scored two significant victories last week in an ongoing battle in this state over public entities monopolizing fire alarm monitoring, according to the head of the Illinois Electronic Security Association.

ADT runs afoul of California law

Wednesday, February 1, 2012

ADT has agreed to pay almost $1 million to settle a civil lawsuit brought by the district attorney of California’s Contra Costa County over contracts ADT had with residential customers in which it reserved the right to hike monthly fees after the first year. That violated a California law requiring residential consumers get written disclosure of all costs upfront, according to the state.

District Attorney Mark A. Peterson, who announced the settlement this week, said that under the agreement, ADT has said it will follow the law for future contracts and, in addition to a $950,000 civil fine, will pay restitution to some customers whose monthly rate increased during their initial contract term.

Here’s a more detailed account from the Contra Costa Times on the settlement:

A national alarm company agreed to pay a $950,000 civil penalty and provide restitution to some customers to settle a lawsuit by the Contra Costa District Attorney's Office, which claimed certain contractual terms imposed upon customers violated California law.

District Attorney Mark Peterson announced the settlement Monday with Florida-based ADT Security Services, Inc., which sells home burglar and fire alarm systems.

ADT required customers to enter into two- or three-year contracts, in which the company reserved the right to raise monthly fees after the first year. The lawsuit alleged that by failing to advise customers how much the rate increase would be, ADT violated contract disclosure requirements in California's Unruh Act.

The lawsuit further alleged that termination fees for customers who discontinue ADT service could exceed the remaining balance of a contract obligation.

Under the terms of the settlement, ADT will conform its future California contracts to the requirements of Unruh Act, which requires written disclosure to residential consumers of contract terms. In ADT's case, that includes the total price for monitoring services for the initial term of the contract, disclosure of the number of required payments during that term, and disclosure of the amount of each monthly payment.

Murder victim’s family settles with ADT

Tuesday, October 4, 2011

ADT recently settled a lawsuit regarding a Minnesota woman murdered in her bed in 2006 after her security alarm failed to go off, and the case carries implications for the security alarm industry, according to a newspaper account of the case.

Here’s more from a Minneapolis Star Tribune story earlier this week:

Four children who survived a middle-of-the-night double murder in Washington County five years ago will receive a financial settlement that will provide for them for life after a bruising lawsuit over a failed home intrusion alarm.
The case involving the estate of Teri Lee, shot dead in her bed in West Lakeland Township in 2006, could hold implications for homeowners trusting intrusion alarms to protect them and for alarm companies relying on contract language to insulate them from liability.
Just how much money ADT Security Services Inc. will pay the family to care for Lee's four children remains sealed in federal court under the confidential agreement reached Friday. But [an attorney for the family], Bill Harper of Woodbury, said the amount was "substantial" and will provide for the children for the rest of their lives.
Inquiries to ADT seeking comment Saturday were unreturned. The large national company, which has headquarters in Florida, never admitted in court filings any responsibility for the shooting deaths of Lee, 38, and her boyfriend, Timothy Hawkinson, 47.
The two were killed in a second-floor bedroom on Sept. 22, 2006, just weeks after Lee spent $2,405 on an intrusion alarm system to protect herself against the man who would murder them both.
But when Steven Van Keuren, a jealous and disturbed former boyfriend who had violated several court orders that prohibited him from contacting Lee, cut the phone lines outside her house in the early morning darkness, nothing happened. When he shattered a glass patio door with a crowbar, a sensor failed to sound.
Van Keuren crept up the stairs to Lee's bedroom with a handgun, but two new motion detectors didn't respond. The screeching alarm finally activated when Lee's two daughters opened the front door to escape -- after their mother and Hawkinson were dead.
Hawkinson's family reached an undisclosed settlement with ADT years ago, Harper said.
ADT initiated legal action soon after Lee's death to argue that a clause in the contract she had signed declared the company's maximum liability at $500. That led to a volley of legal briefs that Harper said filled 10 filing cabinets.
In the broader picture, Harper said, the case creates a legal precedent in Minnesota in that an alarm company's attempt to limit liability in fine print isn't absolute. Such a warning wouldn't cover a "known peril" such as Van Keuren when a homeowner installs alarms to protect against a specific threat, he said.”

I contacted ADT, which declined to comment. I’m trying to find out more about the legal implications of this case for the industry. Stay tuned.

ISC West features new partnerships and acquisitions


LAS VEGAS—What was new on Day 1 of ISC West 2011? As usual, there were a number of partnership announcements and a couple of acquisitions; new this year was lots of talk about physical security information management systems. PSIM announcements abounded on the show floor.