The US Department of Justice and the Federal Trade Commission (FTC) sued Adobe for imposing a hidden cancellation fee on users who wanted to cancel their subscriptions. Adobe is accused of forcing users through a complex and difficult cancellation process to discourage them from canceling unwanted subscriptions.
US government sues Adobe over hidden cancellation fee
Adobe offers Creative Cloud products on a subscription basis, paid monthly. But this monthly payment doesn’t mean you can cancel at any time. Most customers are actually locked into a hidden one-year contract.
After signing up for a free trial, customers are enrolled by default in an annual Creative Cloud plan. Adobe users who want to cancel the annual contract have to pay a hidden fee of 50 percent of the remaining contractual obligation.
Adobe offers customers a higher-cost, cancelable monthly subscription plan, but the difference is not always made clear to new or existing customers. Adobe’s website lists a monthly fee of $60 for access to all its apps, but that’s only if you agree to an annual contract.
A true month-to-month plan, which is cancelable, has a monthly fee of $90, and if you pay a year in advance, there are no refunds if you cancel after the 14-day period.
According to the Department of Justice, Adobe’s arrangement violates the Restore Online Shoppers’ Confidence Act (ROSCA). It allegedly hides hidden fee information through fine print and hard-to-notice links.
For years, the complaint states, Adobe has profited from this hidden fee, misleading consumers about the true costs of subscriptions and using it as a powerful customer retention tool by imposing the fee when they tried to cancel.
Adobe also allegedly failed to provide consumers with a simple mechanism to cancel their online subscriptions. Instead, in order to protect its subscription revenues, Adobe allegedly subjected its subscribers to a complex and inefficient cancellation process filled with unnecessary steps, delays, unwanted offers, and warnings when trying to cancel.
The lawsuit seeks unspecified amounts of consumer redress, monetary penalties, and a permanent injunction preventing Adobe from continuing to use hidden fees to prevent customer cancellations.
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