A class action lawsuit against Nicor Inc. and related defendants (collectively, “Nicor”), is currently pending in state court in Illinois. The plaintiffs are seeking damages and injunctive relief. It is not too late to get involved.
If you live in Illinois and have ever purchased Nicor’s Gas Line ComfortGuard gas-pipe repair service, you may have overpaid for this service and suffered material financial harm. You may have legal claims against various Nicor defendants and should contact an attorney to discuss your rights.
What is ComfortGuard?
Nicor sells ComfortGuard as a gas-pipe repair service, claiming to provide a range of repairs to customers. Nicor charged ComfortGuard customers $4.95 per month ($59.40 per year), which was added to its customers' gas bills.
The Exorbitant Cost Versus Value of ComfortGuard
ComfortGuard is a service that plaintiffs allege had almost no value in relation to its exorbitant cost. Over 400,000 Nicor customers purchased ComfortGuard from 2006 to 2012, but only about 2% of ComfortGuard customers received repairs in a year, at an average cost of only $75. Plaintiffs allege that the average per-customer benefit of ComfortGuard was only $1.32 per year, as compared to its annual cost of $59.40, resulting in enormous profits to Nicor.
The ComfortGuard Scam
Nicor sold ComfortGuard through an aggressive telemarketing campaign that the Illinois Commerce Commission (the “ICC”) found to be deceptive. Nicor allegedly represented to customers that it would not repair a gas leak “inside” the home or business premises unless the customers purchased ComfortGuard, and that the service would protect against expensive repairs. Plaintiffs allege that, in fact, the costs that ComfortGuard covered were minimal, and, that Nicor field technicians performed inside repairs regardless of whether the customer has ComfortGuard. In other words, the services provided by Nicor Gas were allegedly identical regardless of whether its customers had purchased ComfortGuard. Nicor allegedly incorporated these misrepresentations into scripts that were read during each sales call by its representatives, who earned generous commissions on each successful sale of ComfortGuard.
Merger and the Illinois Commerce Commission Proceedings
In December 2011, a merger was completed between Nicor and Atlanta-based AGL Resources Inc. Pre-merger, the ICC—which regulates public utility services in Illinois—held hearings to rule on the fairness of the $2.4 billion deal. Evidence presented during these proceedings established that Nicor thwarted competition for gas line warranty services, sold ComfortGuard in a manner not subject to market forces, and used false, misleading, deceptive, and unfair business practices in their sale of the service.
It was further established during ICC proceedings that ComfortGuard generated over $2,000,000 a month in revenues, while the actual costs of the concomitant repair services provided was only $50,000—or less than $0.10 per month per Comfort Guard customer.
As reported in Crain's Chicago Business article at the time of the proceedings, the Illinois Commerce Commission staff agreed with Illinois Attorney General Lisa Madigan and Chicago-based Citizens Utility Board that ComfortGuard “is a rip-off peddled with misleading marketing and scare tactics."
Want to know if you have legal options regarding this Nicor Gas Line ComfortGuard lawsuit?
If you purchased a Nicor Gas Line ComfortGuard gas-pipe repair service, please contact Grant & Eisenhofer P.A. to discuss your potential claim by submitting the form, or by calling us at 888-554-3529.
Please visit Grant & Eisenhofer to learn more about us and our expert consumer claims practice.