A New York state judge ruled Thursday that Sirius XM Holdings Inc. violated federal law by making it too difficult for customers to cancel their subscriptions.
New York Attorney General Letitia James filed a lawsuit against the company in December, accusing the satellite radio and streaming giant of unfair business practices.
Justice Lyle Frank of the state Supreme Court in Manhattan ruled that SiriusXM's cancellation process was "clearly not as easy" as signing up.
The company required customers to engage in lengthy phone conversations with live agents trained to persuade them to stay. During these conversations, customers were presented with up to five alternate service offers before being allowed to cancel.
"A court found that @SIRIUSXM illegally forced people to go through a long and burdensome process to simply cancel their subscriptions," James said Friday on X, formerly Twitter.
"We sued SiriusXM to protect people's wallets, and now, SiriusXM must simplify its cancellation process and stop taking advantage of New Yorkers," she said.
The ruling mandates that SiriusXM overhaul its cancellation practices to comply with the law and pay unspecified damages.
In her lawsuit, James cited Sirius XM's data showing customers spent an average of 11.5 minutes canceling subscriptions by phone and 30 minutes online.
She argued that customers should be able to cancel with a simple click or through a self-service option similar to the ease of signing up.
Justice Frank acknowledged that the company had taken measures to avoid its cancellation process being considered fraudulent, citing training materials emphasizing being "fast, friendly, and efficient" and allowing customers to cancel if they insisted.
While he found that offering alternative deals before proceeding with cancellations was not deceptive, he noted it could be frustrating.
"This decision reaffirms the right of consumers to fair and transparent business practices," James said in a statement Thursday. "No one should have to spend excessive time and effort canceling a service they no longer want."
A SiriusXM spokesperson told Newsweek in a statement that the company plans to appeal the ruling.
"New York started this case last year by alleging that 'SiriusXM has continued to engage in repeated and persistent fraud and illegality.' Today, we know, and the State of New York knows, that is not true," the statement said.
"Yesterday, the Court dismissed almost all of the charges against SiriusXM, and found that SiriusXM's policies were neither misleading nor deceptive. Most importantly, the Court ruled that SiriusXM had shown through "a plethora of material...that they have taken repeated steps to avoid creating such an atmosphere" of fraud or deceit."
The statement continued, "While the Court found some technical violations of a Federal statute, it did not find that SiriusXM ever deceived anyone or committed any fraud. SiriusXM intends to appeal the Court's ruling as to those technical violations."
"Additionally, SiriusXM will abide by the recent FTC ruling when it goes into effect," the statement concluded.
Last week, James announced a $45 million settlement with a nursing home operator accused of neglecting its residents.
James filed a civil lawsuit last year accusing the Centers for Care owners and operators—which operate nursing homes around New York—of using Medicaid and Medicare funds to enrich themselves while neglecting nursing home residents.
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