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DirecTV Sues Dish Network Reseller Over Sales Tactics

A Dish Network Corp. (DISH) reseller instructed sales staff to say they worked for DirecTV (DTV) and wear its logos when trying to get customers to switch their service to Dish, DirecTV claimed in a lawsuit.

Dish One Satellite, based in Provo, Utah, is accused of having its employees identify themselves as DirecTV representatives and falsely tell customers that Dish and DirecTV are part of the same company and DirecTV service had been generating complaints, according to the suit filed in federal court in Sacramento, California.

“Defendant Dish One sent the Dish One sales force out wearing shirts containing an unauthorized reproduction of the DirecTV trademarked name and logo (alongside the logo of Dish Network),” according to the Dec. 2 complaint.

The alleged tactics highlight some of the pressures in the pay-TV industry, which is seeing slower growth and greater competition between phone companies, cable and satellite service providers. Michael Hammond, Dish One’s chief executive officer, didn’t immediately respond to a message seeking comment on the lawsuit.

Dish One is a Dish-authorized retailer, according to its website. Dish Network, based in Englewood, Colorado, licenses its trademarks to affiliates like Dish One. Dish Network wasn’t named as a defendant in the lawsuit.

Nine Homes

DirecTV tracked the sales activities of the Dish One employees to at least nine homes where customers were persuaded to switch service, according to the lawsuit. In some cases, to sidestep contract termination costs, Dish One employees would pose as a DirecTV customer and claim to be have been notified of military deployment, a provision that would allow penalties to be waived.

The complaint includes allegations trademark infringement, false advertising, fraud, slander and negligence.

DirecTV, based in El Segundo, California, seeks a court order ending the tactics and awarding triple damages.

DirecTV is the largest satellite-TV company and Dish Network is No. 2.

The case is DirecTV LLC v. Dish One Satellite LLC, 13-02497, U.S. District Court, Eastern District of California (Sacramento).

To contact the reporters on this story: Karen Gullo in federal court in San Francisco at kgullo@bloomberg.net; Scott Moritz in New York at smoritz6@bloomberg.net

To contact the editors responsible for this story: Michael Hytha at mhytha@bloomberg.net; Nick Turner at nturner7@bloomberg.net

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