FTC sues Adobe for difficult subscription cancellations

Adobe (ADBE) is facing new legal challenges after the Federal Trade Commission (FTC) filed a lawsuit against the software company. The FTC alleges that Adobe is violating consumer protection laws because of the difficulty of its subscription cancellation process.

Yahoo Finance’s Market Domination report highlights the specifics of the lawsuit.

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This message was written by Angel Smith

Video transcription

Adobe is being sued by the FTC, now alleging that the software company violated consumer protection laws by making it too difficult for consumers to cancel their subscriptions.

In response, Adobe states that our priority is to always ensure our customers have a positive experience.

We are transparent about the terms and conditions of our subscription contracts and have a simple cancellation process.

We will refute the FTC Claims Tribunal.

So we have a fight on our hands.

Julie Bloomberg.

By the way, Bloomberg quotes an FTC official as saying that Adobe trapped customers into year-long subscriptions with hidden early termination fees and numerous obstacles to cancellation.

But you heard Adobe’s response, they are clearly fighting and going to court on this issue.

Yeah, I mean, we’ve all had the experience of having trouble canceling subscriptions for various things and there are rules in place to try to prove that that doesn’t happen.

Um, I saw a report that if you have a suite of applications like Adobe Photoshop et cetera, $700 is about the cost that you can incur.

And according to the FTC complaint, this is at least partly due to the timing of your cancellation.

In other words, if you can’t, if you sign up and you don’t cancel within a certain period of time, then you can get some sort of prorated penalty.

We can’t get out of this easily.

Again, that’s what the FTC is claiming here.

It was a 2010 consumer protection law that set the parameters for all of this and was intended to protect online shoppers.

And I had read that, in fact, Doby had revealed late last year that the F DC was investigating subscription practices.

So, you know, it’s not a huge surprise here, I think for the street.

RIGHT.

Exactly.

Although we don’t always know what the outcome will be, we now know in this case what they will try to do.