According to the lawsuit, employees facing aggressive sales quotas were "learned and actively encouraged" to convert $ 35 activation fees that customers pay to upgrade their phones to the cost of multiple subscriptions to DirecTV Now. This is alleged to have been accomplished by "waiving the charge but charging the customer anyway and applying payment to up to three DirecTV Now accounts using fake email addresses."
The complaint alleged that customers were not reported to have been signed up for a subscription, and it is said that the company sent regular complaints from customers who claimed to have been billed for accounts they did not sign up for. The complaint also describes other alleged methods of increasing subscriptions without the consent of customers.
The purpose of these efforts, the court argued, was to give the false impression that the service offset the decline in DirecTV's legacy satellite business and help justify the acquisition of Time Warner, now called WarnerMedia. WarnerMedia is the parent company of CNN.
"We plan to tackle these unfounded claims in court," an AT&T response said.
Plaintiffs include Local 449, a Pittsburgh-based federal pension fund, and Melvin Gross, an investor who traded Time Warner shares for AT&T shares as part of the acquisition.
DirecTV Now, which AT&T launched at the end of 201
But beyond the supposed inflation of subscriber numbers for customer unintended costs, the service also suffers from significant turnover as customers leap from one discount to a streaming service to another, according to the complaint.
The complaint states that the plaintiffs and their attorneys spoke with a number of current or former AT&T employees who provided information about the alleged scheme. He cites a former Michigan employee who claims that about 40% to 50% of his clients, beginning in early 2017, complain that they have been billed for DirecTV Now subscribers for who stated that they had not registered.
The allegations come in which is for several reasons a delicate moment for the company.
The company specifically called DirecTV Now in a recent letter to the AT&T board, calling the service "poorly performing" and pointing to its declining customer base.