Lawsuit accuses SiriusXM of preventing cancelations, trapping customers in unwanted subscriptions

NEW YORK -- SiriusXM is the target of a lawsuit from the New York attorney general's office accusing the satellite radio company of trapping customers in subscriptions and finding ways to prevent them from cancelling.

On Wednesday, New York AG Letitia James announced she's suing SiriusXM after an investigation discovered that the company "forces its subscribers to call or chat online with an agent to cancel a subscription, then deliberately draws out those interactions as part of its strategy" to prevent subscribers from cancelling their packages.

In a press release, James said that a company's difficult cancellation process is illegal.

"Consumers should be able to cancel a subscription they no longer use or need without any issues, and companies have a legal duty to make their cancellation process easy," James said. "New Yorkers can trust that when companies like SiriusXM try to take advantage of them and violate the law, my office will step in to stop them."

SiriusXM said in a statement that upon "receiving and reviewing the complaint, we intend to vigorously defend against these baseless allegations that grossly mischaracterize" its practices, adding that it offers a "variety of options" for cancellations.

James' office said it also found that SiriusXM trains its agents to not take "no" for an answer when customers are cancelling. Agents do that by allegedly keeping customers on the phone for a "lengthy six-part conversation" that involves several questions and offering retention offers in an attempt to prevent them from cancelling.

The investigation was opened after "hundreds of customers" reported complaints of the company's difficult cancellation process.

In one example laid out by James, a SiriusXM agent allegedly kept a customer in an online chat for 40 minutes despite their "clear and repeated" requests to cancel and continued to charge them after, despite the customer cancelling. SiriusXM claimed it "was not able to locate any cancellation request" from the customer, James said.

SiriusXM can cancel a subscription with a "simple click of a button," noting that conversation times of 11.5 minutes on phone or up to a half hour online isn't necessary, according to the investigation's findings.

James is seeking compensation for affected customers, penalties against the company for alleged fraud and restitution for violating New York's laws. She also wants to require SiriusXM to "implement a simple and easy-to-use cancellation process."

Affected customers are encouraged with similar issues to report problems to James' office.

SiriusXM (SIRI) has about 35 million subscribers, with two million in New York. Earlier this year, the Federal Trade Commission proposed a rule that would let Americans more easily cancel free trials and subscriptions they no longer want.

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