Paragon Cable Agrees to Refund Excess Late Fees : Litigation: Company settles district attorney’s lawsuit by setting aside $1.77 million to reimburse customers.

As part of a lawsuit settlement reached with the Orange County district attorney’s office, Paragon Cable agreed Friday to set aside $1.77 million to reimburse customers who were forced to pay excessively high late fees on their monthly bills to keep their service.

Paragon Cable’s 99,000 former or current customers who were charged late fees over the past four years can file a claim for reimbursements averaging $5.05 for each late fee billing, up to three billings totaling $15.15, said prosecutor Andrea L. Burke. Claim forms will be included in upcoming billing statements and newspaper advertisements, officials said.

For amounts greater than $15.15, customers will be expected to provide documentation that they were charged a late fee, she said.

The district attorney’s office launched its investigation a year ago after receiving a complaint about the company’s $11 monthly late fee and gripes that the cable company’s billing statement made it difficult to tell when the bill was due, officials said.

In some cases, the late fee was charged 10 days sooner than stated on the monthly billings, officials said.

Burke said the district attorney’s office examined how much the company lost on late payments versus what it gained through late fees.

“We simply felt that the late charge they had was excessive,” Burke said. “We were basing that by looking at their administrative costs, accounting costs and so forth.”

Paragon Cable did not admit wrongdoing as part of the settlement reached Friday. Attorney Thomas Miller stressed that the company is not trying to soak its customers and said it costs the cable company “hundreds of thousands of dollars in additional costs” when subscribers make late payments.

“We’re not trying to stick it to anyone,” Miller said, adding that the cable company recently dropped the late fee to $5 per billing period.

“As part of the resolution, we’re also made a commitment to reword the language [of the billing statement] to make it clearer for customers,” Miller said.

Paragon Cable’s service region includes Fountain Valley, Garden Grove, Stanton, Westminster, Los Alamitos and Huntington Beach, Burke said.

The company agreed to set aside $1,770,196 to make restitution payments and $350,534 in civil penalties and to cover the costs of the investigation.

Restitution funds not paid out will be placed in trust funds to be used for cable-related services and programming in public schools within Paragon Cable’s service area and investigation and prosecuting consumer protection cases, Burke said.