FTC Sues Adobe Over Subscription Cancellation Fees and Practices

Adobe

The US Federal Trade Commission has filed a lawsuit against Adobe Inc., the company behind popular software like Photoshop and Acrobat. The FTC alleges that Adobe deliberately hides high termination fees within its subscription plans and makes it difficult for users to cancel their subscriptions.

In a legal action initiated in a federal court in San Jose, California, the FTC contends that Adobe conceals fees, which can potentially reach hundreds of dollars, and other essential terms of its annual paid monthly subscription plan in fine print or behind text boxes and hyperlinks.

The cost associated with terminating an Adobe subscription has been a frequent source of dissatisfaction among users of Adobe products. For individual users, access to Adobe’s app suite can cost over $700 annually.

To receive a full refund, subscribers must cancel their subscription within two weeks of purchase; failing to do so will result in a prorated penalty. It is notable that certain other digital services, such as Netflix Inc. and Spotify Technology, do not charge a cancellation fee.

Regulators have indicated that Adobe’s management is aware that customers often misunderstand the terms of their subscription agreements. They further emphasized that Adobe’s subscription pricing strategy incentivizes users to commit to longer-term agreements and discourages cancellation.

“Adobe trapped customers into year-long subscriptions through hidden early termination fees and numerous cancellation hurdles,” Samuel Levine, director of the FTC consumer protection bureau, stated. “Americans are tired of companies hiding the ball during subscription signup and then putting up roadblocks when they try to cancel.”

According to the lawsuit, Adobe’s actions are in violation of a 2010 consumer protection statute enacted to protect online shoppers.

Last year, the FTC filed a similar lawsuit against Amazon Inc. under the same statute, alleging that the company misled customers into subscribing to its Prime membership service and deliberately made the cancellation process cumbersome.

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