US DOJ Sues Adobe Over Hidden Termination Fees and Complex Cancellation Process
- Lawsuit Allegations: The U.S. Department of Justice has sued Adobe for allegedly misleading consumers by hiding early-termination fees and complicating the subscription cancellation process, particularly with the “annual paid monthly” (APM) subscription plan.
- Adobe’s Response and Legal Actions: Adobe plans to contest the claims, maintaining that their subscription terms are transparent and the cancellation process is straightforward. The DOJ is seeking various legal remedies, including injunctive relief and civil penalties, citing violations of federal consumer protection laws.
The U.S. Department of Justice has filed a lawsuit against Adobe, accusing the software giant of misleading consumers by concealing early-termination fees and complicating the subscription cancellation process.
In a complaint filed on Monday, the DOJ alleges that “Adobe has harmed consumers by enrolling them in its default, most lucrative subscription plan without clearly disclosing important plan terms.” The government claims Adobe pushes consumers toward the “annual paid monthly” (APM) subscription without adequately informing them that canceling within the first year incurs substantial fees.
The lawsuit highlights that Adobe only reveals the early-termination fees when subscribers attempt to cancel, effectively trapping them in unwanted subscriptions. According to the complaint, “Adobe hides material terms of its APM plan in fine print and behind option textboxes and hyperlinks, providing disclosures designed to go unnoticed and that most consumers never see. Adobe then deters cancellations by employing an onerous and complicated cancellation process.”
Adobe intends to fight the claims in court. Dana Rao, Adobe’s General Counsel and Chief Trust Officer, defended the company’s practices, stating, “Subscription services are convenient, flexible, and cost-effective, allowing users to choose the plan that best fits their needs, timeline, and budget. Our priority is to always ensure our customers have a positive experience. We are transparent with the terms and conditions of our subscription agreements and have a simple cancellation process.”
The DOJ’s complaint accuses Adobe of violating federal consumer protection laws and seeks “injunctive relief, civil penalties, equitable monetary relief, as well as other relief.”
Adobe transitioned to a subscription model in 2012, requiring consumers to pay for software access on a recurring basis rather than a one-time fee. This model now generates the bulk of the company’s revenue. The Federal Trade Commission has also taken action against similar practices, notably filing a lawsuit against Amazon last year for allegedly complicating the cancellation process for its Prime service subscribers.
