By Blake Brittain
(Reuters) – Home security provider Vivint Smart Home Inc owes rival CPI Security Systems Inc $189.7 million for tricking its customers into moving to Vivint’s service, a North Carolina jury decided Friday.
The federal jury in Charlotte found Vivint sales representatives unlawfully deceived CPI customers into signing contracts with Vivint by falsely claiming that Vivint had bought the company.
The jury said Provo, Utah-based Vivint violated federal trademark law, competed unfairly with CPI, interfered with CPI contracts and committed other misconduct.
A Vivint spokesperson said the company would appeal the decision and that the damages were “completely disconnected from the total economic impact of any activity that CPI claims to have occurred.”
CPI CEO Ken Gill said in a statement that Vivint has been “taking advantage of vulnerable people across the country” for at least 15 years, and that he hopes the verdict will “stop their deception for good.”
Charlotte, N.C.-based CPI filed the lawsuit in 2020, accusing Vivint of having its sales representatives go door-to-door telling CPI customers that Vivint had acquired the company and was “taking over” their accounts.
CPI said its customers would then unknowingly sign “high-priced, multi-year” contracts that Vivint made “impossible for customers to cancel.”
Vivint denied the allegations. It told the court it competed fairly with CPI and that CPI customers had switched to Vivint for legitimate reasons.
Vivint rival ADT LLC accused the company of similar misconduct in a Florida lawsuit that was settled in 2018. ADT said at the time that Vivint would pay $10 million to settle the case.
The case is CPI Security Systems Inc v. Vivint Smart Home Inc, U.S. District Court for the Western District of North Carolina, No. 3:20-cv-00504.
(Reporting by Blake Brittain in Washington, Editing by Alexia Garamfalvi and Diane Craft)
