MANHATTAN (CN) - National Home Protection defrauded "tens of thousands" of home warranty customers in "an ongoing, massive fraud" that it's run since 2003, a class action claims in Federal Court. The class claims NHP lures in customers by promising them a $50 gift card, fails to provide the services it promises - and doesn't even send them the gift card.
National Home Protection is "one of the nation's largest service contract providers," according to the complaint.
It states: "A National Home Protection Home Warranty is a service contract, which purportedly provides protection against the expense of repairing or replacing existing home appliances and mechanical systems which break down due to normal wear and tear.
"For several years, NHP has lured customers into purchasing warranties by misrepresenting the plans' most important characteristics. NHP even promises a $50 gift card to everyone that signs up for NHP coverage plan.
"NHP has lured thousands of customers by advertising the benefits extensively in print and online media. But none of NHP's claims are true. Contrary to advertisements and other widely disseminated statements, NHP does not provide these promised services. Not only does NHP not fulfill the promised financial duties to its customers, but it repeatedly and systematically fails to send the $50 gift certificate.
"Individuals who purchase NHP warranties are forced to pay a monthly fee believing that NHP would keep the promises alleged in the contract. The truth, however, is that the class paid millions in fees for nothing. NHP ignores and refuses' customers' claims, thus denying the homeowners the benefits promised to them. NHP ignores complaints about this misconduct too, and continues to perpetrate its fraudulent scheme."
The class seeks punitive damages and an injunction. It is represented by Craig Stuart Lanza with Balestriere Lanza.
Subscribe to Closing Arguments
Sign up for new weekly newsletter Closing Arguments to get the latest about ongoing trials, major litigation and hot cases and rulings in courthouses around the U.S. and the world.