Home Alarm Systems: ADT Sues over High Pressure Alarm Sales - Again

The Claim

Residential security giant ADT is suing Pinnacle Security in federal court, alleging the Utah-based summer model company and its employees used unlawful and deceptive sales strategies to steal ADT’s customers and damage its reputation. ADT also accuses Pinnacle of theft of confidential information about ADT customers and breach of contract.

I’ve written on the “door knocker” alarm sales phenomenon before – where the companies came from, why people complain about them, and even the specific tactics they use. The complaints have mounted up very quickly, but they’re not all coming from the competitors like ADT: plenty of consumers have also contacted their state and local governments, and some of the door knocker companies have paid hefty fines (over $100,000) to settle.

The Counter-Claim – and the Plot Thickens

However, Pinnacle, formerly an ADT dealer that went independent in 2006, “vigorously denies” the allegations. Pinnacle contends that ADT is going after Pinnacle because of its growing success. “Based on our review of the lawsuit, we believe it is clear that the largest company in the residential security market (and perhaps others) has targeted Pinnacle because of our growth and market share gains we have made in the residential security industry,” Pinnacle said in a statement responding to Security Systems News’ questions about the legal claims.

Did you catch the fact that Pinnacle used to be an ADT dealer? That tidbit adds a nice wrinkle: ADT did buy large portfolios of accounts from Pinnacle in prior years. If you missed the article explaining how the ADT Authorized Dealer program works, it’s worth a read.

Hard to Make this Up

This is not the first time ADT has gone to court over summer sales. In 2009, ADT and Monitronics filed lawsuits against individual door-to-door salespeople alleging deceptive sales practices. Two of three lawsuits filed by ADT were against Pinnacle employees. In the most recent case, however, Pinnacle itself is listed as the sole defendant. ADT claims Pinnacle received complaints about at least one salesman, but rehired him “to maraud around the country and unleash his arsenal of unlawful and false statements upon a new group of unsuspecting consumers.”

The colorful language in that last paragraph certainly sets the tone of the conflict. It’s a shame when the word “maraud” is used in a sentence describing the actions of an alarm salesman, but there it is. The good news is that most alarm companies play by the rules. Even better, a few alarm companies with next-generation business models have set a new standard for transparency and professionalism, in addition to offering products and services that were essentially unavailable before. We believe FrontPoint is one of those rare companies, with wireless home alarm systems that are safer, smarter, simpler, and more affordable than traditional systems offered by the great majority of our competitors. Our online reviews say it all – so if you are shopping for the best in home security, we invite you give us a call.