The Office of the San Francisco District Attorney secured a successful settlement in a civil action alleging that HomeAdvisor, Inc., violated California laws by making misleading statements regarding its advertised background checks.
San Francisco, CA – Today, San Francisco District Attorney Brooke Jenkins announced that HomeAdvisor, Inc., and its parent corporation will pay $6.82 million in civil penalties to resolve a false advertising action filed against them.
“By misrepresenting the scope of background checks, HomeAdvisor engaged in inherently deceptive advertising,” said District Attorney Brooke Jenkins. “Consumers should be able to trust that claims about background checks performed on service professionals, particularly those who go into their homes, are truthful and accurate.”
HomeAdvisor operates an online platform that consumers can use to find service providers such as plumbers, painters, and contractors to perform work on their homes. Over the course of a multi-year television, radio, and online advertising campaign, which ran from 2014-2018, HomeAdvisor told consumers that the “professionals” or “pros” engaged through its platform—in other words, the individuals who perform the actual home repairs or improvements—were background-checked and therefore could be trusted to be in or around a consumer’s home.
The complaint alleged that this advertising was false and misleading. Specifically, the complaint alleged that despite what it told consumers, with certain minor exceptions, HomeAdvisor actually performed background checks only on independently-owned business entities that wished to join HomeAdvisor’s network and the owners/principals of those business entities. It did not perform background checks on the various non-owner/principal employees or laborers who might actually perform the work at a consumer’s home, nor did it perform background checks on businesses that are franchisees, dealers, or independent contractors of a larger national company or corporate account. As the Court of Appeal put it, HomeAdvisor’s advertisements were “inherently likely to deceive reasonable consumers.”
In addition to civil penalties, the stipulated judgment also includes a permanent injunction requiring the company to refrain from false or misleading statements regarding the scope of its background checks. The lawsuit was prosecuted by the Special Prosecutions Unit of the District Attorney’s Office. The judgment was signed by the Honorable Joseph Quinn, Judge of the San Francisco Superior Court.
“Companies should always make sure that advertisements regarding the services they sell are accurate, but this is especially important where the representations relate to public safety,” said Managing Assistant District Attorney Daniel Amador. “As a result of this lawsuit, HomeAdvisor was forced to stop running its misleading advertisements. We are pleased that HomeAdvisor has corrected its advertising practices and agreed to resolve this action.”
Managing Assistant District Attorney Amador leads the Office’s Special Prosecutions Unit, which handles a wide range of civil and criminal matters for the San Francisco District Attorney’s Office. This settlement is the result of significant work by the attorneys and support staff of the SPU, including Assistant District Attorney Matthew Beltramo, Assistant District Attorney Trevor Kempner, and Paralegal Chloe Mosqueda.
Court Number: CGC-18-565008