Contractors sue HomeAdvisor, say site’s leads are ‘overwhelmingly bogus’

Digital marketplace HomeAdvisor is being sued by the owners of eight small home-improvement companies who say the Golden-based company twisted a lead-generation business into a vehicle for greed and abuse.

The plaintiffs all paid to be members of the site and for sales leads. They accuse HomeAdvisor of misrepresenting its services, and allege that the customer leads the company sells are “overwhelmingly bogus.”

The plaintiffs, who include the owners of Westminster-based B&B Carpentry, are seeking class-action status for the lawsuit, filed July 16 in U.S. District Court in Denver.

“The allegations are attacking the fundamental business that HomeAdvisor is operating,” said Kimberly Donaldson Smith with Chimicles & Tikellis, one of the attorneys representing the plaintiffs.

A spokeswoman for HomeAdvisor, which has agreed to take space in the HUB mixed-use development being built at 36th and Blake streets in RiNo, said the company does not comment on pending litigation.

In addition to Colorado, the plaintiffs own businesses in New Jersey, Illinois, California, Ohio, Florida, New York and Idaho, specializing in services ranging from home inspections to metal roofing.

The plaintiffs say they joined HomeAdvisor as a member between August 2014 and August 2017.

Brad and Linda McHenry, who own B&B Carpentry, told BusinessDen in an interview that they joined HomeAdvisor after a disappointing experience with the company’s predecessor, ServiceMagic, because they were told HomeAdvisor would refund them for money spent on “bogus” leads. They canceled several months later, having again been disappointed with the information provided. They claim they never received a refund.

Brad McHenry estimated they paid HomeAdvisor $3,500.

“I recognize that it’s not a huge amount, but it’s not chump change either,” he said. “And the reality is they robbed me of my time and my talent too.”

The McHenrys and the other plaintiffs are represented by Gordon Netzorg, Mark Williams and Carla Martin of the Denver office of Sherman & Howard, as well Donaldson Smith and other attorneys at the Haverford, Pennsylvania, and Wilmington, Delaware, offices of Chimicles & Tikellis.

The lawsuit makes claims about HomeAdvisor that range from the nature of the company’s business model to the culture of its Colorado offices. The allegations include:

• HomeAdvisor won’t tell companies, or “home improvement professionals,” in advance how much they will pay for each customer lead, but the amounts range from roughly $10 to $140.

• The leads sold to the companies are “overwhelmingly bogus” and “illusory” because they are often “over distributed” or contain, among other things, disconnected phone numbers, people who are not homeowners or contacts for nonexistent residences.

• HomeAdvisor represents that the majority of its leads are generated through its website, when a majority actually are generated by third-party affiliates, which generally result in less-useful leads.

• HomeAdvisor won’t let members turn off leads permanently, instead forcing those that want to avoid paying for leads to log in regularly to “freeze” leads.

• While members can set a budget for how much they want to spend on leads each month, if the budget is altered, it resets for the month, which can result in members paying for more leads than they want.

• When companies cancel their HomeAdvisor membership, HomeAdvisor leaves their company profile page on its website, and sells the information entered by individuals who attempt to contact the company to other Home Advisor members.

The attorneys representing the plaintiffs are familiar with HomeAdvisor. Two years ago, they filed a lawsuit against the company on behalf of Rochester-based Airquip Inc. That case is ongoing.

That lawsuit makes similar allegations to the one filed last week.

POSTED IN Retail, Top News

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38 Comments on "Contractors sue HomeAdvisor, say site’s leads are ‘overwhelmingly bogus’"

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davebarnes
Guest

Bogus leads! I am shocked!

Stacy Singleton
Guest

I am so angry right now 7 days 5 completely non-viable leads and they won’t give me my money back. Asked to talk to the boss of the boss and got hung up on.

Yasir Karwi
Guest

How do I get in on a lawsuit against this company? They are a complete scam! I am having a hard time canceling and do not want to incur anymore bogus fees.

Melissa Idarraga
Guest

hello! I see so many people involved on home advisor fraud, what if we all together sue them to make them close the place

Veronica Agapito
Guest

We are a victim of Home Advisor. They sent us to collection and now I am trying to fix this and I get a run around.
We don’t want this on our credit report if collection agency doesn’t work with us. I need a lawyer to atleast get us off the collection before it gets reported to Credit Bureau.
Home Advisor took my $288 membership fee plus false Lead charges.
Please help!

Jenny
Guest

Did you ever figure out how to join the lawsuit? I’m experiencing the same thing and the unexpected account withdrawals and no refund after doing my due diligence to call leads back is in fact financially debilitating.

Rachel’s Stewart
Guest
HomeAdvisor is a scam. They charge each professional for the same lead regardless of which one actually wins it. Not to mention that 99% of these leads either don’t answer the phone or we’re not even looking for a contractor in your line of work or at all for that matter. They are making Immeasurable amounts of money each day and I can honestly say the I got maybe 5 jobs total. Each job was only $40 and HomeAdvisor wanted $10-$40 for each lead. Which meant I wasn’t making anything but only losing all the way around. I really wish… Read more »
Jose Renteria
Guest

Anyone has any information on how to join the lawsuit?

Michael Taylor
Guest
How do I join this lawsuit? I Cancelled my agreement with them and they continue to charge me, and now ill not refund the monies for the 40 bogus leads. I had one lady I called that was literally looking for the work to be completed for free. I called my HA rep (Andres at 516-350-8638) He went on to argue with me that this is a valid lead for work. Compensation is not guaranteed. He further went on to explain that he was a contractor and knows that I just didn’t sell her on our service. I should try… Read more »
Andy Braudway
Guest

We have never used their services, but so many of our clients have horror stories about the leads they received and how oversold they were. No one wins when you race to zero.

Jack Handborrow
Guest
What about the over 125,000 active contractors on HomeAdvisor that are paying for leads and are extremely successful ?? This article fails to mention that contractors can quit HomeAdvisor at any time and they decide how many leads they want and are in full control. If it was a scam and the leads were “overwhelmingly bogus” how come there are still active members? Some of which have been members for 5, 10 + years. At the end of the day this is advertising.. it is not an exact science.. if you put out a TV commercial and get 0 business… Read more »
Donna g
Guest

Well with 125000 contractors it’s been said only half have their leads on at the same time. I worked for Homeadvisor for over 2 years and used their service as a contractor. I was very frustrated for paying for leads on work I don’t even do. Bad contact, disconnected numbers, and I still paid. I feel the contractors pain and I stand with them.

Paul Allen
Guest
I will tell you why my leads are still turned on. After 52 leads in and only won one job because 80% of the 52 were bogus, terrible, non existent leads that you don’t get money back you just receive free leads. In my case I had over $2,300.00 of bad leads that they gave me a $1200 credit of free leads. All of the free leads were just the same. So I’m still in the hole. Once the free leads were exhausted we were uninfated with a ton of leads that we paid for. Even though I had my… Read more »
John Torre
Guest
Completely false statement. Home advisor will have one valid lead but will dispatch 20 plus tradesmen to that call and charge every single tradesmen regardless if they call or not. That’s a ripoff. They also send false leads that your stuck paying for. I personally traced 7 calls I recieved and found out they were spoofed and wrong numbers. One specific homeowner that was a valid call told me she had 37 tradesmen call within 30 minutes. Now if your charging $20 usd To each tradesmen times 37 HomeAdvisor is making a killing while the hard working man suffers. One… Read more »
Shah Shaikh
Guest

How do I get in on a lawsuit against this company? They are a complete scam! I am having a hard time canceling and do not want to incur anymore bogus fees.

Eric Zibbel
Guest

I had a homeowner call me and say that had selected a contractor but their insurance company needed a second bid. These are the leafs home advisor charges contractors $144 for. The only reason home owners use this service is because of aggressive marketing. They have no idea the costs that are passed to small business people:

James Burness
Guest

No, you CANNOT quit at any time. I spent about an entire week’s worth of attempting to get my account canceled and the only way it worked was to stop payment on my credit card. Now I’ve been sent to collections. HomeAdvisor was the worst marketing decision I ever made.

TA Young
Guest
@Jack The lawsuit highlights the representations of Home Advisor (HA) as being misleading when service providers (HA Clients) sign on. Lead generating businesses prey upon the emotion and desperation of many gbusiness owners across the spectrum. For Software sales, a company can pay $2K++ for just one lead. The value is there, if the leads are qualified. Businesses are fully away that not every lead presents a sale. Instead of alleging that the plaintiffs are simply hiring a lead service searching to shortcut solid business practices, check out HA’s claims. HA promises to pre-screen leads. I’ve used them before, in… Read more »
Tom Stewart
Guest
This article does not look at the success a lot of businesses have had with Home Advisor, but it does bring up some plausible points. We have had success with Home Advisor and continue to use them, but I am concerned about a couple key flaws in their corporate structure. First, their return policy is unfair and seems to be set up to maximize profit not pursue a sense of fairness. Second, the third parties that try to generate leads seem to be incentivized to produce as many leads as they can, no matter the quality. When you combine an… Read more »
William Simmons
Guest
I did work for Home Advisor for six months and tried to turn off my leads number of times and would still receive leads I would call them and they would tell me it was a error and they were correct it so I would do the same thing so I got number of leads that was so bogus it was crazy first thing I told Home Advisor when I signed up with thim I didn’t want to be overwhelmed and I didn’t need that leads and they assured me I would be overwhelmed I would get just six leads… Read more »
Zee
Guest

I joined home advisor in March 2018 after the first month of receiving all bogus leads I told them to turn off my leads and max they could do was 90 days at a time I kept doing it until the end of my contract but then at the very end even though I turned them off they kept sending me leads and charge me $1000 and they want me to pay for it when I’ve never use their service this company is a total rip off I advise all contractors to stay away .

Md Hasan
Guest

This article does not have a look at the achievement plenty of groups have had with Home Advisor, however, it does bring up some plausible points. We have had fulfillment with Home Advisor and retain to use them

Thomas Herman
Guest

My name is Tom Herman owner operator of Herman’s Quality Painting was a member of Home advisor and spent a couple thousand on leads the were bogus and would like to be involved in this lawsuit! Who would I need to speak to ?

Melissa Idarraga
Guest

my name is Melissa Idarraga an I want to be involved too. someone else from Texas

Don Cook
Guest
I understand the suits. We signed on with Homeadvisor over three years ago and initially the leads received were decent with occasional bad ones that we’d receive instant credit for with the rep that answered the phone. In the past year the lead quality has plummeted to the toilet. And if you call in to report a bad lead, the rep passes it on for “review”. Bad phone number, work out of your task, whatever, your request WILL be denied. We have 100 reviews on Homeadvisor and have received their “Best of” designation every year we’ve been with them but… Read more »
Deneisa Thompson
Guest

I to was misled by home advisory they debited thousands of dollars totaling 6000 Without permission or any given notice, And then when I call them on it suspended my service and refused to refund money…

Deb Forrest
Guest
I would like to join this lawsuit too! I cancelled my Home Advisor subscription on 4/9/2019 that was due to be renewed om 4/12/2019 . what everyone has said in these posts, i have also experienced…bad and bogus leads, jobs being given to others when you were an “exact match”, not getting refunds because I didnt call “in time” whatever that means. not respecting my budget. I would have to pause my leads every 2 weeks because they would allow to to do it for longer periods!! It has been nothing but a pain!!! So glad to be free of… Read more »
erik m robertson
Guest

Count me in. Got me for 6-7k in 3 months. didn’t notice the 1st wave because i forked out a bunch of money on subs but the 2nd wave of 2k was after i knock my budget down to the 100 min and didn’t accept any leads. will be calling tom but doubt i will have success

Rhonda Register
Guest
I just started our Handyman service a few months ago , when I contacted home advisor to sign up I was told the highest price I would pay for a lead would be 40.00 and my budget was set for 300.00 a month the 1st month they deducted almost 1000.00 out of my account when I called to see if they could hold the payment because I didnt have that much , they refused . I paused my leads for 2 weeks and re ieved a few calls from people that got my number from google and got the jobs… Read more »
Bruce Laing
Guest

how do I join this suit

Rafael Esquivel
Guest
is it possible to be apart of this class action lawsuit. my girlfriend Andi have a small business out of dallas tx and have been lied to several tines and have paid for leads we did not ask for. i placed my leads on hold and was still charged. when I called homeadvisor I was given the run around. I made a complaint with the BBB by home advisor is a member of the BBB and I again was given the run around. my email is [email protected] I agree we should make a huge class action lawsuit and make them… Read more »
James Jett
Guest
Let me know if you are serious and I will join in another lawsuit against them. The exact same thing happened to me. Received leads when account was paused and charged for leads in areas that I never asked for or approved. They saw that my leads were paused and they weren’t making money so they added areas without authorization and “somehow” my leads were unpassend long enough to be charged, This company is so unethical and deceitful it’s unbelievable. Until contractors stand up and sue they for the lies and underhanded business practices they will continue to operate the… Read more »
Marina Raimondo
Guest

Marina Raimondo

Eric
Guest

I also am a small contractor and business owner and would join a class action lawsuit in a heartbeat to shut down this company. Even if all the money went to lawyers, the amount of advertising and marketing this company does to steal money from hard working people is criminal.

Jim bell
Guest

Jim bell, same I’m looking for lawyer to sue them if you can help let me know

Victoria
Guest

Please tell me how I can also join this lawsuit.

Mark D
Guest

It had to be too good tp be true..Over $2000 paid to HA..I have 3 customers from the leads..
I want in on the lawsuit too..

Jay Villalobos
Guest

Apparently, im not the first person they took advantage of how can I join this lawsuit.