The irony underlying the ADT Security class action is breathtaking: ADT Security markets a service to protect homeowners from robbers, but ADT itself may be committing its own form of corporate thievery. ADT has become an iconic corporate name and is identified in the United States as providing security monitoring systems for homeowners.
The pending ADT class action lawsuit first alleges that ADT Security Services charges an exorbitant early termination fee (sometimes called an early cancellation fee). Recent court decisions have struck down early termination fees as unlawful penalties if large corporations use these fees simply as an anti-competitive device when the early termination fee is not predesigned to compensate only for the true costs of the early termination. The class action alleges that ADT unilaterally imposes these early termination penalties, even when ADT fails to perform the services promised.
The class action complaint further asserts that the early termination fee is an unlawful penalty as ADT imposes this fee from customers who contracted with ADT to simply monitor a system that was previously installed, requiring no equipment to be installed and resulting in a windfall to ADT upon termination. By charging the early termination fee ADT gets paid for years of monitoring without doing any monitoring to earn those fees.
In addition, homeowners have complained that ADT routinely and unilaterally increases alarm monitoring fees while consumers are under contract for lesser fees. These increases are implemented without adequate prior notice and without providing the appropriate and required disclosures necessary to ensure that customers consent to these increases in advance. ADT relies on small boilerplate text neither signed nor highlighted for customers to claim its "right" to unilaterally increase fees.
The lawyers bringing this class action continue to investigate ADT’s business practices.