December 15, 2010 / 8:49 PM / 7 years ago

UPDATE 1-DirecTV to pay out $14.25 million to states

* DirecTV to pay $14.25 million to 50 states -company

* Violated consumer practices with ads, contracts -AG

* Shares down 1.4 pct (Adds DirecTV comment, updates share price)

By Liana B. Baker

NEW YORK, Dec 15 (Reuters) - DirecTV Group DTV.O will pay $14.25 million to all 50 states after a two-year investigation showed the satellite provider violated consumer practices with hidden fees and misleading advertisements.

“This was classic bait and switch -- hooking consumers with phony discounts and then hitting them with hidden charges,” said Connecticut Attorney General Richard Blumenthal in a statement on Wednesday.

Thousands of consumers have filed complaints against DirecTV in different states concerning the provider’s cancellation fees, deceptive advertising and the availability of sports packages.

DirecTV spokesman Darris Gringeri said the attorneys general were sensationalizing the announcement.

“The fact is, we were implementing the majority of these improvements long before the AGs even brought this to our attention,” Gringeri said.

DirecTV is one of many companies that have been investigated by state officials over subscription policies.

In 2007, AOL Inc AOL.N paid $3 million to 48 states and the District of Columbia, after consumers complained that the Internet company was making it difficult to close accounts.

In October, legal officials in five states said they were investigating Sirius XM Radio Inc’s (SIRI.O) billing practices. [ID:nN13242640]

Shares of DirecTV were trading 1.4 percent lower at $39.67 on the Nasdaq. (Reporting by Liana B. Baker, editing by Gerald E. McCormick and Matthew Lewis)

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