Ambit Charges Higher Rates Than Advertised, Class Action Says

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A group of New York residents have filed a class action lawsuit against Ambit Energy for allegedly pulling a “bait and switch” by increasing energy prices on customers without informing them of the change in rates.

The Ambit Energy class action lawsuit was filed by plaintiffs Taurshia Simmons, Navid Kalatisadeh and Brian Whitney, who allege that the independent energy company based in Dallas had promised them that they would save at least one percent on their energy bill compared to what their former energy company charged.

However, the plaintiffs allege that Ambit Energy used deceitful calculations to show the apparent savings. In addition, Ambit allegedly signed customers up for plans that were more expensive without telling customers of the move and without informing customers that to maintain the lower rates, they would have to automatically opt-in on an annual basis.

“Ambit markets itself as a less-expensive alternative to existing utilities, telling potential customers to ‘stop paying too much for electricity,'” the Ambit Energy class action lawsuit says.

“Ambit offers its New York customers a supposedly sure thing: guaranteed savings compared to . . . their existing utility charges. Ambit calls this offer the ‘Guaranteed Savings Plan,'” the plaintiffs explain in the class action lawsuit.

According to the plan, “Ambit promises that its customers’ 12-month energy costs will be at least one percent less than what the customers’ existing utility would have charged, or Ambit will make up the difference.”

Ambit allegedly deceives customers by overstating “what the incumbent provider would have charged, thus depriving customers of their full one percent (or more savings,” the plaintiffs add in their Ambit class action lawsuit.

In addition to the “broken promise,” the plaintiffs also allege that Ambit “fails to inform customers that they will need to wait a year or more for their refund checks, which defendants hold onto for their own use.”

On top of these alleged complaints, the plaintiffs claim that starting in January 2012, Ambit “implemented a new policy that eliminated the supposed benefits of the one percent Savings Guarantee,” which it supposedly did “without warning.”

The New York Select Variable Plan was put in place by Ambit and the energy company allegedly “began automatically shifting customers signed up for the Guaranteed Savings Plan and began automatically shifting customers signed up for the Guaranteed Savings Plan into the New York Select Variable Plan.”

The only way to get out of being transferred to the Variable Plan, was for customers to actively tell Ambit that they wanted to stay with the Guaranteed Savings Plan.

“Unfortunately, the Company failed to give its Guaranteed Savings Plan customers adequate notice of this new default policy,” the Ambit class action lawsuit states. “Thus, like plaintiffs, tens of thousands (if not more) of Ambit’s customers found themselves automatically defaulted into the higher costing Variable Plan.”

However, the Variable Plan is allegedly not even mentioned in any of Ambit’s “marketing materials or on its website,” it’s not something customers can sign up for directly, and they only find out about through “Ambit’s automatic default policy,” when they are signed up for it.

The plaintiffs allege that “Ambit’s unilateral amendment of its Terms of Service violates New York’s Energy Services Consumer Bill of Rights . . . which mandates that energy customers must affirmatively consent in writing to material changes in their energy plans,” which the plaintiffs claim Ambit never did.

Ambit is also charged with unjust enrichment.

The plaintiffs are proposing a New York class of Ambit customers who enrolled in the Guaranteed Savings Plan and were unwillingly signed up for the Variable Plan who bought natural gas or electricity for residential use after Sept. 5. 2007.

Similar class action lawsuits have been filed against Ambit in New Jersey and Pennsylvania.

The plaintiffs are represented by Wittels, McInturff and Tiasha Palikovic of  Wittels Law, Seth R. Lesser and Fran L. Rudich of Klafter Olsen & Lesser LLP, and Charles J. LaDuca and Beatrice Yakubu of Cuneo Gilbert & LaDuca LLP.

Counsel information for Ambit is not yet available.

The Ambit Energy Class Action Lawsuit is Simmons v. Ambit Energy Holdings LLC, Case No. 503285/2015 in the Supreme Court of the State of New York, County of Kings.