Shook Obtains $10 Million Settlement in Deceptive Trade Practices Case

For the third time this year, Shook attorneys have obtained a multimillion-dollar settlement for electronic security provider ADT in a case involving a competitor’s deceptive trade practices. Before trial began, the competitor’s last settlement offer was $2 million; after two days of proceedings, the case settled for $10 million. Partners Charlie Eblen, Chip Sander and Jason Scott and Associate Eric Hobbs represented ADT in Florida federal court. 

ADT filed suit against Utah-based Vivint, Inc., after hundreds of consumers complained that Vivint sales agents had visited their homes in unannounced “cold” door-to-door visits. ADT alleged that the agents misled existing ADT customers—many of whom were elderly or disabled—into believing that Vivint represented or was affiliated with ADT, or that they worked for the companies that made the ADT alarm equipment already installed in their homes. Once inside a home, ADT alleged, Vivint sales agents persuaded the customer to allow them to install “upgrade” equipment, then had the customer sign a new service contract with Vivint. As a result, many ADT customers were forced to choose between paying Vivint contract termination fees or giving up their ADT service. 

ADT’s complaint included claims for unfair competition in violation of the Lanham Act, common-law unfair competition, violation of the Florida Deceptive & Unfair Trade Practices Act, and trade slander/commercial disparagement. With this latest settlement, Shook has has recouped nearly $17 million for ADT in such trademark cases in 2017.

The case is ADT LLC v. Vivint, Inc. No. 17-80432 (S.D. Fla., settled December 11, 2017).