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On Tuesday, an energy customer filed a class action lawsuit against Ambit Energy LP, a Texas-based power reseller and marketer, alleging that the power company deceived customers by falsely promising low electricity rates and free energy in its marketing and then overcharging for services.
Lead plaintiff Michael Urbino filed the class action lawsuit in New Jersey federal court. Urbino alleged that the Texas energy company used deceptive marketing ploys currently permitted by deregulated retail electricity markets in New Jersey and other states to offer customers “life-changing rewards,” “free travel, cruises and getaways,” and “free energy” to get them to switch energy suppliers.
The class action lawsuit alleges that Ambit claims it is able to do this by offering to charge competitive electric rates based on prevailing marketing conditions, but, in reality, rates based on prevailing marketing provisions actually increases the cost of electricity for Ambit’s customers. Urbino also alleges that Ambit deceptively markets its electricity sales by offering either rewards or “free energy,” but in truth, argues Urbino, the rewards are worth much less than the savings and benefits Ambit allegedly promised.
“In fact,” argues the plaintiff in his deceptive marketing class action lawsuit, “Ambit Energy’s pitch is in reality a false and misleading scheme, in which the rates actually charged to consumers are not competitive and bear little relation to prevailing market conditions.” Further, Urbino argues, “As a consequence of this scheme, consumers in New Jersey and across the nation are essentially being scammed out of millions of dollars in exorbitant charges for electricity.”
Urbino alleges that he switched his energy company from another New Jersey based utility company, PSE&G, to Ambit Energy in 2012 based on Ambit’s allegedly deceptive marketing promising substantial savings. However, Urbino claims in his class action lawsuit that his Ambit electricity bill was more than 60 percent more than his PSE&G bill would have been. “No reasonable consumer who knows the truth about the Ambit Energy’s exorbitant rates would choose Ambit Energy as an electricity supplier,” the deceptive marketing class action lawsuit says.
The class action lawsuit alleges that Ambit Energy’s marketing constituted breach of covenant of good faith and fair dealing and unjust enrichment, as well as violated New Jersey’s Consumer Fraud Act. Urbino seeks to represent a Class of current and former Ambit Energy customers with his class action lawsuit. “Plaintiff brings this action to redress the deceptive marketing and billing practices of Ambit Energy,” Urbino says in his class action lawsuit, “which have resulted in thousands of consumers across the nation to pay substantially more for their electricity than they should have paid in the absence of Defendant’s unlawful and misleading scheme.”
Lead plaintiff Michael Urbino is represented by Jonathan Minkove and Lawrence J. Friscia of Friscia & Associates LLC, and Charles J. LaDuca, Bonnie Prober and Michael J. Flannery of Cuneo Gilbert & LaDuca LLP.
The Ambit Energy Deceptive Marketing Class Action Lawsuit is Urbino v. Ambit Energy LP, et al., Case No. 3:14-cv-05184, in the U.S. District Court for the District of New Jersey.
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41 thoughts onAmbit Energy Hit with Deceptive Marketing Class Action Lawsuit
You probably haven’t heard anything back on how to join because they are all false comments, competitors competing, or they didn’t read the contract .Now since they feel like they got scammed or mislead instead of owning up to their own lack of reading the contracts they feel the need to slam the business petty if you ask me !
Still have not heard what needs to be done to be included in the settlement, who to contact,etc.
LESSON IN REALITY for your Ambit Kool-aid response:
Do you know what the statistics are for network marketing? Approximately 90 – 95% are out of the business within 30-90 days. Why does that matter? Have you ever heard of the term breakage in network marketing? I didn’t think so…it refers to the reps that leave the business. This matters because who is looking after those customers that were just brought on by the new rep who is already out of the business? To answer your question Doc- no one is. Why is that significant? Because the customer is brought in on a guaranteed savings plan (2% for NY) for 12 months. That’s great! However, it’s no longer automatic like it was back in the early days of the Ambit NY market. “Don’t worry- it’ll be the same rate whether you enroll in the guarantee or not- you just won’t get the savings statement at the end of the 12 months.” That’s completely and utterly inaccurate. The fact of the matter is if you were to call Ambit on any given day and ask them for the rates in an area like NY (or any other guaranteed savings state) they will quote you 4 different rates: 1- incumbent reported rate, 2- guaranteed savings rate, 3- 7% guaranteed savings rate (first 2 months for those just switching to an ESCO), and 4- the variable rate. I promise you sir, all 4 will be different and the variable rate will be higher than the guaranteed savings rate.
Now, getting back to the case in point, at the end of that 12 months you have to enroll back in the guaranteed savings rate otherwise you’re subjected to the variable rate which can sometimes be a few cents higher. A few cents doesn’t really hurt the individual customer but do it to a few hundred thousand per month for a number of months and now you’re talking millions of dollars. Ambit does make an attempt to call or reach out to the customer to get them back on the guaranteed savings plan OR it’s ultimately left up to the “consultant” or rep to monitor that for their customer. However, when you consider the statistics of breakage (and I’ll be conservative), 70% of the customers don’t have anyone (consultant or rep) looking out for them and if Ambit’s feeble attempts to make contact with the customer are not received then guess what- that customer is subject to the higher variable rate. More often than not, the customer assumed his friend or family member is watching out for them and assumes they’re still getting a great rate which equates to great savings. But like I said, due to breakage, it’s just not reality.
Sorry to burst your bubble sir but Ambit is just like any other company out there. They’re nothing special. There isn’t necessarily anything wrong with what they’re doing they’re just not doing it with integrity in my opinion. I recently looked over my parents’ bill (they came off the guaranteed savings rate) and they were paying 0.12/kWh. ConEd (the incumbent) is charging 0.069/kWh. For natural gas they have Nat Grid. Ambit charging 0.76/therm and Nat Grid charging 0.42/therm. That’s a SIGNIFICANT difference. I understand they should have enrolled in the savings guarantee but for them to be subjected to paying 74% HIGHER for electricity and 81% HIGHER for natural gas is just plain wrong. Hence, why people are bringing price gouging class actions against them.
Dear Spiss…I see a legal problem here…I am a NYS resident. For the last 2 billng cycles I was charged 300% what my local utility company charges. When I called Ambit, they said I received a letter in October and did not respond. Oh, I see. When I received what appeared to be another piece of junk mail from Ambit and I failed to repy, I was consenting to pay 300% what National Grid charges for therms and Kwh. Yeah, that makes sense. How many elderly and uneducated customers are able to realize their rates were jacked up? When they do, how many months have passed? Tens of thousands of customers and many months, Im guessing. Gee, how many millions of dollars is that?…Is there a NYS class action suit — Please advise. – Albany, NY, former Ambit customer.
I am neither for or against Ambit, but I have been working for different electricity companies (Esco, Rep) in various management positions. The problem with most of you is that you do not understand the way electricity works and how companies work. Every ESCO wishes you would renew believe it or not: We have to buy electricity that will be used two quarters down and for projection/forecasting purposes it is best practice to have the customers locked in. If YOU dont take responsibility for YOURSELF and read your contracts beforehand and if YOU dont take YOUR responsibility and call in to renew, or email, or webchat, etc. Then it is absolutely, positively, 100% YOUR fault. Do me a favor, go down a list of different electricity companies and look up their reviews, every customer in every company is mad for the same reasons. Nobody is scamming you but yourself. Like someone else said, these idiot lawyers want your money, do you think this is the first time someone has tried to sue an Esco? Get in line please, every ESCO has a legal team who makes sure rules are followed – You guys really think a company that has won the JD Power award (in this case Ambit) and has an A+ Score with the BBB (again Ambit) actually wants to Scam you?? The moral of the story is take responsibility for yourself and find a good price and re-new always re-new, quit trying to be babies by companies, I bet if they did call constantly to get you to renew yall would be pissed of so many calls and complain about that, I seriously do not envy weak minded people who think everyone is out to get them because they CHOOSE not to take in responsibility. I personally know people who have made plenty of money off ambit – but in my career currently it does not interest me.
I have lost well over $1,800
with Ambit energy back on 2010
2011/2012
it star it with @11 per kwh and
without noticing went up to @22
for quit long time & every time i called i was on d phone for HRS and no one answer d phone pls Help Thank You
I find it slightly odd how few people are applauding this scam of a company while so many others have had horrific experiences. I think perhaps some people might be consultants, employees and management, or paid comment posters and mods. It’s the exact method used by companies with bad reviews. It’s very suspicious. As far as being a \deadbeat\ who never reads our mail, that’s a week argument writhe with logical fallacies and childish name calling. No! No! Bad troll! Onto our less than stellar (to say the least) experience with Ambit. We used to live in a town with one municipal utilities service. We thought they were bad. At least we knew when our rates went up and they did try to work with you. We switched to Ambit after seeing the great rates. Little did we know our bills would be sent late every month and customer service are puppets and often vindictive. We signed up for 6 months under .8 and when our contract was about to end I called 3 times to tell them I needed to renew my contract. I know. I regretted it weeks later after being told I was good we received a bill for $600 at .179. I called incredulous. I swore we had taken care of it due to receiving confirmation numbers for each of my transactions and agreement . They told me it was their mistake and they would fix the bill. I asked them to send me the updated bill. Nope. We were disconnected after I called them asking several times where the new bill was and what it was. They kept saying oh, well the agreement didn’t go through. You must have hung up. Apparently magic confirmation numbers appear out of the air. A day later I received a piece of mail thanking me for renewing my service dated on the same day I had requested it. I called to tell them I got the agreement. They said don’t worry, you’ll recieve your updated bill. I asked to pay the updated amount right then to avoid disconnection. They told me to just pay it when I received the bill because they couldn’t do that. I waited for the bill and then one day I wake up and they had disconnected me. I was livid. I called asking wtf. I was told there was no agreement. I had to pay the whole amount. Seriously. I talked to 4 useless individuals after finally being offered a retroactive rate if I signed up and the reconnection fee would be waived. I agreed again, received a confirmation number. I received my agreement the next month. The nightmare wasn’t over. A day later I recieved a bill for $1,000. What?! We don’t even use that much electricity. I called and was told it was because we were disconnected. Yeah. We were because you guys screwed up. We were told once again they would retrofit the bill if we for a third time agreed to a 6 month contract and paid 375.00 by the end of the day on the 10th. I paid it and received a disconnect notice with the fixed rate again. Damn it! I asked why and they said I was disconnected. Are you serious? I did everything I agreed to do and still they wouldn’t listen to me. Today I received a bill for the same amount I paid plus another one for $760. I now have 3 days to pay both despite what we agreed on or once again they will either lock me into agreement that they will just break yet again and disconnect me probably tomorrow despite 3 days to pay. I’ll tell you this. They won’t get a dime out me and I signed up with another provider who gave me a great deal just for leaving Ambit. Still we’re out over a grand that was worth nothing. They need to be taken down.
Edit: we were not disconnected the first time after the renewal we just recieved a high bill. (Don’t want any rudeys calling me out.)
Does anyone know how to join this class action lawsuit?
Oh really well the letters that would tell us to renew never came and my rep never said a word so I tried to help a friend and I was screwed out of over $1000. NO ONE EVER TOLD ME I HAD TO RENEW!!! SO YOU CAN TAKE YOU DEADBEAT COMMENT AND GO AWAY! You are just pissed because they are going to go under with all these lawsuits and you making money off your friends, which yes they told me when I talked to the company goes away. My rate would be one if my rep was not active and higher if he was so I should have just mailed a check to my friend or so called friend since he was getting the extra money. Oh and by the way if you never tell the people you signed up to renew then their bills are higher so you make more money! So you wake up, you are making money off a company that screws people out of their money because they tried to help a friend. Lets think what does that make you all on here saying they are a great company! Just remember there is no such thing as free and what goes around comes around!
I live in Rome NY and also have been scammed by Ambit Energy. They sent $2.00 dollar rebates for the first year and then my bill exploded for electric usage prices.