New Mexico's attorney general has sued Vivint Solar Inc., accusing the company of ensnaring rooftop solar customers in 20-year contracts with escalating costs and clouding the home titles of customers by falsely naming them as debtors in property records.
Attorney General Hector Balderas filed suit March 8 against Vivint and related companies in the state's Second Judicial District Court in Bernalillo County, N.M., alleging Vivint engaged in unfair business practices, fraud and racketeering affecting thousands of customers in the state. The complaint said Vivint bound consumers in power purchase contracts that required them to purchase electricity generated by solar systems placed on their homes at rates that increase by more than 72% over 20 years.
Balderas alleged Vivint's door-to-door sales managers engaged in high-pressure sales techniques and made statements designed to mislead consumers into believing the contracts would save them substantial amounts of money compared to prices they would pay their utility company. The complaint also alleged that Vivint filed improper notice in real estate records that in some cases make it difficult for customers to sell their homes.
In response, Vivint said that its practices met ethical standards and complied with state law.
"While we take these allegations very seriously, we strongly believe this lawsuit lacks merit. We cannot comment more specifically on pending litigation," Vivint said in a statement, "Our commitment to our customers is to provide them the opportunity to adopt clean, renewable energy while always adhering to the highest ethical sales standards. We believe we have honored this commitment in New Mexico and that our practices in the state comply with applicable law.
Unlike most solar companies, Vivint does not sell or lease any solar equipment but extensively advertises that it installs solar systems for free in exchange for the customers' commitment to buy all the power produced by these rooftop systems. The attorney general, however, alleges the "free" offer is a trap that ensnares customers in lengthy and overpriced power purchase agreements.
"Vivint engages in a host of business practices that violate New Mexico law," the attorney general said. Consumers, he added, were not given legally required paper copies of contracts or notices of their right to cancel the agreements.
The watchdog group Campaign for Accountability reported Vivint and Tesla Inc. subsidiary SolarCity Corp. have been the targets of consumer complaints in other states, such as California and Massachusetts.
