CHARLOTTE, N.C. – (Friday, Feb. 17, 2023) – CPI Security won a significant civil lawsuit today after an eight-person jury in the U.S. District Court Western District of North Carolina Charlotte Division unanimously found competitor Vivint Smart Home responsible for using deceptive door-to-door sales practices to mislead and confuse CPI customers, so that Vivint could take over their alarm systems. The jury awarded CPI Security a sizable amount of money in damages.
“While we’re thrilled the trial ended in our favor, I want to be clear that this case is not just about CPI’s business,” CPI Security CEO and Founder Ken Gill said. “We believe for at least 15 years, Vivint has been taking advantage of vulnerable people across the country through deceptive, misleading, and flat-out false practices. I hope today’s verdict will stop their deception for good.”
CPI Security sued the Utah-based smart home security company in September 2020 claiming Vivint used false or misleading information to acquire existing CPI Security customers and lock them into high-priced, multi-year finance and monitoring contracts with Vivint.
Vivint deceived CPI’s customers by making some of the following false claims:
- Vivint representatives presented themselves as being affiliated with CPI
- Vivint is purchasing or has purchased CPI
- Vivint is “taking over” CPI customer accounts
- Vivint manufactures CPI’s equipment and is at the customers’ homes to upgrade CPI’s system
- Vivint was sent or is acting on behalf of CPI
After signing contracts under the false pretense of Vivint’s scams, customers would later come to realize that Vivint’s claims were untrue. However, Vivint made it difficult for customers to cancel their contracts with Vivint. This led to many CPI customers being frustrated with both Vivint and CPI Security, despite CPI having no affiliation with Vivint or the schemes they used to deceive CPI’s customers.
CPI’s evidence submitted to the jury demonstrated widespread, egregious practices at Vivint affecting not only CPI and its customers but also other alarm companies and their customers. For example, a corporate training video encouraged sales representatives to press themselves into customers’ homes, intentionally not allowing the customers to refuse entry.
CPI Security further proved its allegations in court with numerous witnesses speaking about their experiences of being scammed or targeted by Vivint’s deceptive sales practices.
For example, one CPI customer said a Vivint sales representative knocked on his door, saying, “I was one of the guys that installed your CPI System.” The CPI customer told the Vivint representative that he knew that was not true. To which the Vivint representative replied, “What I meant to say is that I am with Vivint, the parent company of CPI.” After the representative tried to get into the customer’s home three times, the customer was concerned about his family’s safety. He had his daughter call the police, grabbed a softball bat for protection, and made the Vivint representative sit in his yard until the police arrived.
Another CPI customer testified that a Vivint sales representative claimed Vivint and CPI were related companies. Unfortunately, the customer believed the sales representative and ended up in a contract with Vivint. The customer had to jump through several hoops to get out of the contract with Vivint, including threatening legal action.
In another instance, a CPI customer, who happens to be visually impaired, was told CPI was going out of business and that there could be a lapse in her alarm coverage. Concerned for her safety, she agreed to have Vivint install a system. Feeling uneasy about what just happened, she called CPI to verify that CPI was going out of business. She then realized Vivint had deceived her.
“I would have thought Vivint’s mission would be similar to ours; protecting and keeping our community members safe,” Gill said. “But Vivint’s practices clearly display the opposite, which is why we are holding them accountable for preying on the vulnerable.”
Vivint has previously been in legal trouble for similar business practices. In May 2021, the Department of Justice with the Federal Trade Commission announced a $20 million settlement in which Vivint allegedly allowed its sales representatives to obtain credit reports of unsuspecting consumers without the consumers’ knowledge or consent, and unfairly sold false debt to buyers or debt collectors.
In addition, 16 state Attorneys General brought actions against Vivint for deceptive sales practices.
In January 2021, the Department of Justice fined Vivint $3.2 million for making false statements to secure financing for customers’ purchase of Vivint products.
In 2018, Vivint agreed to pay a $10 million settlement to ADT to resolve claims similar to those CPI made against Vivint.
CPI Security is represented by Charlie Eblen, Eric Hobbs, Caroline Gieser, and Jason Scott from Shook, Hardy & Bacon L.L.P.
