SAN FRANCISCO—On Wednesday, May 30, the San Francisco District Attorney’s Office announced that a San Francisco Superior Court granted a preliminary injunction against HomeAdvisor, Inc. and its parent company ANGI Homeservices, Inc. The preliminary injunction forbids the defendants from broadcasting television or radio advertisements in California that state or implies that HomeAdvisor performs background checks on all service personnel who come to a consumer’s home.
“This preliminary injunction protects California consumers from misleading advertising,” said District Attorney George Gascón. “HomeAdvisor needs to be honest about who they background-check, so that consumers are well-informed when deciding whether to allow strangers into their homes.”
According to a press release from the SFDA’s Office, the Superior Court found that it is reasonably likely that the People will prevail on the merits of their False Advertising Law (B&P Code Sections 17500 et seq.) and Unfair Competition Law (B&P Code Sections 17200 et seq.) claims. The complaint was filed against the defendants in March. According to the District Attorney’s complaint, HomeAdvisor describes itself as “the operator of the largest home services marketplace across the globe.” It broadcasts ads representing that service professionals — such as plumbers, electricians, painters, and housekeepers — retained through HomeAdvisor have been background-checked. Background checks are the centerpiece of these ads. In a press release announcing its latest ad campaign, HomeAdvisor’s CEO told the press “Ninety percent of project referrals are word-of-mouth, yet the majority of homeowners consistently tells us they want background checks and scheduling – features only HomeAdvisor provides.”
According to the District Attorney’s complaint, HomeAdvisor’s advertisements could make consumers think that the service personnel hired through HomeAdvisor who come into their homes have passed criminal background checks, which is not true. According to HomeAdvisor’s website’s “terms and conditions,” the only person who undergoes a background check is the owner/principal of an independently-owned business. Other employees of the business, including those who come into consumer’s home to perform the requested service, do not get background-checked. HomeAdvisor performs no background checks at all on employees, franchisees, dealers, or independent contractors of larger national or corporate accounts.
The preliminary injunction lasts during the pendency of the District Attorney’s civil enforcement action against HomeAdvisor and ANGI Homeservices. If HomeAdvisor is creating new ads, the injunction allows HomeAdvisor to continue to use some of its existing advertisements until January 12, 2019, but if HomeAdvisor includes prominent visual disclaimers telling viewers that, “HomeAdvisor Background-Checks Business Owners But Not Employees.”
The District Attorney’s action seeks a permanent injunction, civil penalties for the defendants’ unlawful business acts and practices, and restitution. To learn more information see the Order Granting Preliminary Injunction, the People’s Complaint, and the People’s March 8, 2018 Preliminary Injunction Additional Exhibits List.
Written By Casey Jacobs