Adobe faces lawsuit over 'complex and difficult cancellation process' for customers

The U.S. government is suing Adobe, alleging the software company deceived consumers by hiding early termination fees for its most popular subscription plan and making it difficult for consumers to cancel their subscriptions.

A complaint filed in federal court by the Department of Justice (DoJ) claims that Adobe pushed consumers into an “annual paid monthly” subscription without adequately disclosing that canceling the plan within the first year could cost hundreds of dollars.

According to the DoJ, the lawsuit alleges that the defendants imposed hidden early termination fees on millions of online subscribers and that Adobe also forced subscribers to go through a “complex and difficult cancellation process” designed to discourage them from canceling subscriptions they no longer want.

Also listed as defendants are David Wadhwani, president of Adobe Digital Media Business, and Maninder Sawhney, vice president of Adobe Digital Go to Market & Sales. The complaint accuses Adobe’s practices of violating the Restore Online Shoppers’ Confidence Act (ROSCA): the matter will be decided in court.

Adobe’s general counsel and trust director, Dana Rao, denied the FTC’s claims, adding that the company would fight the charges in court.

“Subscription services are convenient, flexible and cost-effective to allow users to choose the plan that best fits their needs, schedule and budget. Our priority is to always ensure our customers have a positive experience,” said Rao. “We are transparent about the terms and conditions of our subscription contracts and have a simple cancellation process. We will refute the FTC’s claims in court.”

After 2012, Adobe primarily shifted to a subscription model, requiring consumers to pay on a recurring basis for access to the company’s popular software. Subscriptions account for the majority of the company’s revenue, the FTC said.

“Adobe trapped its customers into year-long subscriptions through hidden early termination fees and numerous cancellation hurdles,” said Samuel Levine, director of the FTC’s Bureau of Consumer Protection.

“Americans are tired of companies hiding the ball when signing up for a subscription, then throwing up roadblocks when trying to cancel.”

According to a complaint filed in the U.S. District Court for the Northern District of California, the defendants systematically violated ROSCA by using inconspicuous fine print and hyperlinks to hide important information about Adobe’s subscription plans, including fees. “high” early termination rates that customers can pay. be billed when they cancel their subscription.

The complaint alleges that for years, Adobe took advantage of these hidden fees, “misleading consumers about the true costs of a subscription and ambushing them with the fees when they try to cancel, using them as a powerful retention tool,” according to the DoJ Statement.

The complaint alleges that Adobe also violated ROSCA by failing to provide consumers with a simple mechanism to cancel their recurring online subscriptions. Instead, “Adobe allegedly protects its subscription revenue by thwarting subscribers’ cancellation attempts, subjecting them to a convoluted and inefficient cancellation process filled with unnecessary steps, delays, unsolicited offers and warnings,” the DoJ said.

According to the complaint, when consumers purchase a subscription through the company’s website, Adobe pushes them toward its “annual pay monthly” subscription plan, pre-selecting it by default.

The complaint states that Adobe prominently displays the monthly cost of the plan during sign-up, “but buries” the early termination fee and its amount, which represents 50% of the remaining monthly payments when a consumer cancels during of its first year, according to the FTC.

Information about Adobe’s early termination fees is buried on the company’s website in small print or requires consumers to hover over small icons to find the information, the complaint says.

In addition to not disclosing early termination fees to consumers when they subscribe, the FTC complaint also alleges that Adobe uses early termination fees to “ambush” consumers to dissuade them from cancel their subscriptions.

The complaint also alleges that Adobe’s cancellation processes are designed to make cancellation difficult for consumers. When consumers tried to cancel their subscription on the company’s website, they were forced to navigate through numerous pages to cancel.

“When consumers contact Adobe customer service to cancel, they are met with resistance and delays from Adobe representatives. Consumers also face other obstacles, such as dropped calls and chats and multiple transfers. Some consumers who thought they had successfully canceled their subscriptions said the company continued to charge them until they discovered the charges on their credit card statements,” the FTC said.