Class Action Tries to Shed Light on Direct Energy Services' Pricing Tactics

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A proposed class action out of New York takes issue with defendant Direct Energy Services, LLC’s (DES) allegedly deceptive and unlawful marketing and sales practices that the case claims often cause the company’s energy customers to overpay for service. According to the complaint, the defendant fails to “conspicuously disclose” its variable-rate pricing structure to customers, a violation of New York law. More specifically, the case continues, the defendant touts low, temporary fixed energy rates, then “buries the long-term variable rate pricing structure in the fine print of a dense contract without any highlighting or call to attention.”

The lawsuit cites alleged violations of New York’s Energy Services Consumers Bill of Rights (ESCO Bill of Rights), which mandates that all ESCO contracts and marketing materials “clearly and conspicuously identify all variable changes included as part of an energy plan.”

Later, the complaint not only explains why this lawsuit was filed, but also touches on the purpose of class action litigation in general.

“A class action is the only way the company’s customers can remedy DES’s ongoing wrongdoing,” the lawsuit says. “The loss suffered by each DES customer is small compared to the cost of trying to challenge DES’s unlawful practices. It is thus untenable for each individual consumer to bring his or her own lawsuit. In addition, many customers may not even realize they are victims of DES’s deceptive conduct.”