It had been a while since Sirius XM has had any big news on the legal front but a new class action lawsuit has been filed in the state of California.  At first blush this suit seems to be not a very big deal, but some of the numbers (unverified) presented could indicate that the suit might grow some legs.  The suit, Kerry Frank, Steve buttress and Janice Buttress, Individually and on Behalf of All Similarly Situated vs. Sirius XM and XM Satellite Radio was filed late last week.

The suit includes, “All persons who are and/or were residents of the state of California and who have paid for XM Everything-Lifetime NavTraffic and/or Lifetime XM Radio Service subscriptions and whose rights thereto have not been honored by Defendants, including:

(1) Any and all such persons who purchased said lifetime subscriptions in conjunction with NavTraffic or XM Radio and as to whom said Defendants refused and/or failed to provide either or both such services and/or did so only on condition additional and/or further fees be paid for either or both NavTraffic and/or radio services;

(2) Any and all such persons who were informed that said lifetime subscription could not be and/or would not be honored in any fashion and who paid additional fees to receive continuing radio services and/or who surrendered any right to continue receiving said services; and/or,

(3) Any and all such persons who were informed that said lifetime subscription could not be and/or would not be honored in any fashion and who surrendered any right to NavTraffic services and/or who paid additional sums to continue receiving such services.

b. All persons who have paid for XM Everything-Lifetime Nav Traffic and/or Lifetime XM Radio Service subscriptions and whose rights
thereto have not been honored by Defendants, including:
(l) Any and all such persons who purchased said lifetime subscriptions in conjunction with Nav Traffic or XM Radio and as to whom said Defendants refused and/or failed to provide either or both such services and/or did so only on condition additional and/or further fees be paid for either or both NavTraffic and/or radio services;
(2) Any and all such persons who were informed that said lifetime subscription could not be and/or would not be honored in any fashion and who paid additional fees to receive continuing radio services and/or who surrendered any right to continue receiving said services; and/or,
(3) Any and all such persons who were informed that said lifetime  subscription could not be and/or would not be honored in any fashion  and who surrendered any right to NavTraffic services and/or who paid additional sums to continue receiving such services.

The allegations include the following:

ALLEGATIONS PERTAINING To STEVE & JANICE BUTTRESS

On or about November 2007, STEVE and JANICE BUTTRESS became 9 subscribers of XM SATELLITE Radio and XM SATELLITE RADIO’s NavTraffic service (90 day free trial) and shortly thereafter, in or about February 2008, 11 purchased a one year subscription to both services. On or about January 2009, said Plaintiffs entered into a contract with XM SATELLITE RADIO whereby Defendant agreed to provide services under “XM Everything-Lifetime XM Everything” which included XM satellite radio. The terms of said agreement were set forth in a written agreement provided by XM SATELLITE RADIO referred to as a “Customer Agreement”. Plaintiffs are informed and believe, and based thereon allege, that the terms of said Customer Agreement were as set forth in Exhibit 1 hereto. The written agreement was accepted by STEVE and JANICE BUTTRESS and by Defendant according to the terms in said agreement.  Said agreement was supported by consideration in that Plaintiffs paid the required subscription and billing fees and Defendant promised, covenanted and agreed to provide the services required thereby for the lifetime of the radio for which said subscription was obtained or until said Plaintiffs might choose to cancel said subscription.  Plaintiffs, STEVE and JANICE BUTTRESS’ NavTraffic subscription was then renewed for successive one-year periods in February of 2009, 2010, and 2011.

Thereafter, in or about January 2011, said Plaintiffs lost service to XM RADIO’s radio service, although NavTraffic continued to be received. As a result Plaintiffs contacted Defendant and were informed that the company was experiencing a “computer glitch.” Said Defendant gave instructions to re-authorize Plaintiffs’ radio so as to resume said service. Although Plaintiffs made several attempts to reconnect to said service by following the instructions the Defendants’ employees had given them, they were unsuccessful in restoring said service.

Plaintiffs were then referred to a representative from what Defendant represented was its “special department” which had been established to deal with “problem cases” relating to a new billing software system XM RADIO had installed. Said representative informed Plaintiffs that the Defendant’s new software system could not accommodate the lifetime subscription for which Plaintiffs had paid concurrently with the NavTraffic Subscription and that the only way to fix the subscriptions at that time was to temporarily place XM Radio service on a three-year status. Plaintiffs agreed thereto in reliance upon the representations said Defendant’s representative gave them by which she assured them this was a temporary problem that would be resolved and that their lifetime subscription would be reinstated once the computer problem was resolved.

Plaintiffs had no reason not to believe Defendant’s representations, did believe them, and did rely thereon. Said reliance on the representations of Defendant was reasonable.  Shortly thereafter, Plaintiffs received an email from Defendant purporting to confirm their new arrangement, but said communication did not comport with the representations and explanations said Defendant’s representative had given to Plaintiffs. Plaintiffs therefore contacted Defendant to protest Defendant’s attempts to change the agreement and was informed that the lifetime service had been cancelled, the three-year plan was permanent, and no further change could be made so as to restore lifetime status.

By said conduct, Defendant has breached, and continues to breach, said Customer Agreement in that it has failed and refused, and continues to fail and refuse, to provide the agreed upon services.

As a direct and proximate result of said breaches, Plaintiffs, STEVE AND JANICE BUTTRESS, and all those similarly situated, have incurred damages in that they have had to pay for the services they have been provided, in that they have suffered the loss of and cancellation of lifetime and XM Radio services, and in that they face the prospect of future payments to continue receiving said radio services.  In compliance with the terms of the Customer Agreement, Plaintiffs sent the required notice of claim and request for informal resolution of this matter to Defendant on or about July 27,2011, a true and correct copy of which is attached hereto as Exhibit 2.

At no time did Defendants respond thereto.  A true and correct copy of a Statement of Claim, together with a demand for arbitration (a true and correct copy of which is attached hereto as Exhibit 3, was thereafter sent to Defendant and to the American Arbitration Association on January 25,2012. Defendant then failed and refused to pay the fees to the American Arbitration Association that were required of it under the Customer Agreement and otherwise failed and refused to participate in any such arbitration. As a result thereof, the American Arbitration Association dismissed said arbitration and Defendant has waived any and all rights to compel and or require any such arbitration.

Essentially it appears, by the complaints of the plaintiffs that there was a lack of customer service on the part of Sirius XM, and that the company did not handle the situation in a manner that was satisfactory to the customer.  As yet there is no response from Sirius XM.  How an issue like this reaches the levels it did are mind boggling.