The mystery of the reappearing $400 cancellation fee

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Christopher Elliott

Question: We signed up for a two-year contract with DirecTV back in the fall of 2011. At about the same time, DirecTV released new equipment called the Genie. I called up to see if we could get the new equipment and was told we could. There was no mention of a contract extension for the new equipment.

In January of this year, we were looking to cut some costs and we looked at lowering our DirecTV package to save some money. I called customer service and asked to get switched to a less expensive package. I also asked if my new customer credits would be affected and they said they would not be affected if I changed programming. So as a result, I went through with the change.

I received my February bill and sure enough, the credits I was told would not go away were all gone. I called back to customer service to inquire about this. They told me the credits were gone due to me changing my package even though I was told it would not be affected. I changed my package back again and they said the credits would show up on my March bill again.

I then received my March bill and only half of the credits were back on there. The one that was missing was the $10 HD for life credit. I called customer service again and they said that I can’t get that credit back again due to the programming change in January, even though I was told first it wouldn’t go away and then when it did go away, I was told it would come back.

My issue was escalated to a manager as well as the accounts department, both of which said they would look into it. I received a call back within a week and again they said they could not do anything about getting the credit back on there.

I explained that this was unfair and against what I was told on the phone several times. They apologized but said they could not do anything about the credits anymore even though they were promised to not go away.

I then asked to get out of my contract due to these issues and was told I could do that but there would be a near $400 cancellation fee. They said my contract was not up until the fall of 2014. They said it had been extended when I got new equipment, even though there was no mention of a contract extension when I had received the equipment.

I just sent the letter into them today but have a feeling it will not matter. Please help me in any way you can with trying to get this cancellation fee removed for me. — Matt Solum, Salt Lake City, Utah

Answer: What a mess! You’d expect the terms and conditions of your purchase to remain the same, and if they don’t, that a company like DirecTV would inform you of a change in writing. But that’s not what happened.

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DirecTV offers what’s called an HD Access for Life discount. But in order to qualify for it, your account must have a base package of Choice Xtra or above and maintain auto bill pay or joint billing for the lifetime of the account. If any of the requirements are not kept, the offer is removed and can’t be reinstated.

In other words, your actions permanently voided your discount.

Here’s the timeline of events, according to DirecTV: In February, you contacted customer service to have your programming changed to a different package because you had lost some channels when switching to its “Entertainment” package. At that point, you were advised that all credits would start on the following month’s bill, minus the HD Access for Life discount.

About a month later, DirecTV’s records show you called about your missing discount. You were told your account no longer qualified for the offer because the programming package was below the “Choice Xtra” package. Then you called back, asking DirecTV to reinstate the discount again, and when that didn’t work, you closed your account.

DirecTV’s records also show that it received a third-party verification call regarding your order.

“We reviewed the call to confirm he was informed, and accepted, the programming agreement,” a spokeswoman told me. “The purpose of the third-party verification call is to ensure the customer is fully informed of the terms and conditions for their offer, including the details regarding any applicable agreement, the timeframe of agreement and how the early cancellation fee is calculated.”

DirecTV’s records suggest everything was done by the book.

“I’m afraid there isn’t much we can do,” the spokeswoman told me. “All charges are valid.”

I’m sorry, too. If nothing else, this illustrates the importance of a paper trail, as opposed to doing everything by phone. DirecTV has recorded transcripts of the phone conversation. You only have recollections of the phone calls. I would say the company has an unfair advantage.

Next time you have a billing question, try contacting DirecTV in writing. You can contact it online, which creates a paper trail that levels the playing field. If that doesn’t work, try appealing your case to someone higher up. Here’s a list of current executives. The email convention is [email protected]

But why wait? You decided to appeal the rejection to an executive, even after it appeared the charges would stick. DirecTV waived your fee.

Should DirecTV have charged Matt Solum a $400 cancellation fee?

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Christopher Elliott

Christopher Elliott is the founder of Elliott Advocacy, a 501(c)(3) nonprofit organization that empowers consumers to solve their problems and helps those who can't. He's the author of numerous books on consumer advocacy and writes three nationally syndicated columns. He also publishes the Elliott Report, a news site for consumers, and Elliott Confidential, a critically acclaimed newsletter about customer service. If you have a consumer problem you can't solve, contact him directly through his advocacy website. You can also follow him on Twitter, Facebook, and LinkedIn, or sign up for his daily newsletter. He lives in Auckland, New Zealand.

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