By SDCN Staff
San Diego, CA–Vivint Solar, Incorporated will pay $4.3 million to settle consumer protection claims alleging the company misled customers, San Diego County District Attorney Summer Stephan confirmed.
The San Diego District Attorney’s Office, along with four other California prosecutors’ offices, has secured the settlement with the residential solar installation company, and its related entities to resolve the violations involving the company’s solar power purchase agreements.
The settlement stems from allegations tied to solar installations and energy contracts that Vivint Solar entered into with California consumers between August 2016 and October 2020.
The complaint, filed in Riverside County Superior Court, alleges that in advertising and promoting its solar energy systems and the terms of the power purchase agreement’s, Vivint Solar misrepresented the agreements or failed to make adequate disclosures to avoid misleading consumers.
“When companies use misleading and aggressive tactics to ensnare customers, as in the case of this solar company, they are engaging in unfair competition and other consumer protection violations and will be held responsible under the law,” DA Stephan said.
“Many of these companies commit the same violations across the state and being able to leverage our office’s statewide consumer protection partnerships allows us to do more to protect San Diegans.”
A key outcome of the case is the establishment of a $3 million fund that allows consumers to seek reimbursement for losses they incurred.
Prosecutors allege that Vivint Solar engaged in multiple deceptive sales practices. The company is accused of misrepresenting its relationship with local utility providers, including having sales representatives wear clothing branded with a Southern California utility company. They also said the company overstated potential energy and cost savings, telling consumers their monthly bills would decrease when, in many cases, they increased. In addition, Vivint Solar allegedly misled customers about their ability to cancel contracts or agreements.
In the final judgment, Vivint Solar is prohibited from engaging in unfair, illegal or fraudulent business practices related to its solar energy systems, including:
- Making any false statement about the company’s relationship with a local utility, energy savings a customer might expect to receive, or a customer’s ability to cancel the contract.
- Requesting, ordering, or otherwise obtaining a consumer credit report in connection with a consumer’s application for a loan or credit without first obtaining the consumer’s written consent.
- Creating accounts related to the purchase, installation, servicing, or lease of any Solar Energy System without first obtaining the consumer’s written consent.
- Failing to provide translations of written contracts related to the purchase, installation, servicing, or lease of any Solar Energy System in the language in which the contract was negotiated before the execution of such contract; and
- Enforcing a liquidated damages provision in its agreements or contracts, including but not limited to a Vivint Solar PPA, that does not comply with the provisions of Civil Code section 1671 and California case law interpreting that statute.
Under the terms of the judgment, which was entered without admission of liability, the company will pay a total of $1.3 million in civil penalties and investigative costs. It will also establish a restitution fund of $3 million to cover valid requests for restitution from a California consumer regarding solar energy systems sold by Vivint Solar or the terms of any Vivint Solar PPA that fall between August 3, 2016, and October 8, 2020. On October 8, the company became a wholly owned subsidiary of Sunrun, Inc. The company is not a party to the law enforcement action.
Notification to California consumers of the provisions of the Stipulated Judgment, including time limitations on making a claim and methods to submit a claim for restitution, will be provided by Vivint Solar and available on the consumer-facing website of Vivint Solar, Inc. and Sunrun. Vivint’s other entities included in the settlement are Vivint Solar Holdings, Inc. and Vivint Solar Developer, LLC.
