FTC sues Adobe over alleged 'complicated cancellation process' and 'hefty early termination fees'

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The Federal Trade Commission (FTC), together with the Justice Department, has launched a legal action against software giant Adobe, alleging deceptive practices related to its subscription model, following an investigation that was launched last year. The FTC accuses Adobe and two of its executives, Maninder Sawhney and David Wadhwani, of obscuring the early termination fee for its most popular subscription plan and creating obstacles for consumers attempting to cancel their subscriptions.

 

Adobe’s shift to a subscription model after 2012 required consumers to pay for access to the company’s popular software on a recurring basis. The FTC alleges that Adobe steered consumers towards its “annual paid monthly” subscription plan, pre-selecting it as a default. While the plan’s “monthly” cost was prominently displayed during enrollment, the early termination fee (ETF) and its amount were buried in small print or required consumers to hover over small icons to find the disclosures.

 

 

The FTC’s complaint further states that Adobe’s ETF disclosures were not only hidden but also hefty, amounting to 50% of the remaining monthly payments when a consumer cancels in their first year. This practice has led to numerous complaints from consumers who were unaware of the existence of the ETF or that the “annual paid monthly” plan required their subscription to continue for a year.

 

Based on the Restore Online Shoppers’ Confidence Act, the lawsuit alleges that Adobe trapped customers into year-long subscriptions through hidden early termination fees and numerous cancellation hurdles. Samuel Levine, Director of the FTC’s Bureau of Consumer Protection, stated, “Americans are tired of companies hiding the ball during subscription signup and then putting up roadblocks when they try to cancel."

 

This lawsuit has sparked a significant backlash against Adobe, with many consumers expressing their frustration over the company’s subscription practices. The FTC’s action underscores the growing scrutiny of subscription models and the need for transparency in consumer transactions.

 

What are your thoughts on this issue? Do you believe that Adobe’s subscription practices were deceptive, or is this simply a case of consumers not reading the fine print? Share your views in the comments below.

 

 

 

Read more:

• https://www.justice.gov/opa/pr/united-states-files-complaint-against-adobe-and-two-adobe-executives-alleged-violations
• https://www.ftc.gov/news-events/news/press-releases/2024/06/ftc-takes-action-against-adobe-executives-hiding-fees-preventing-consumers-easily-cancelling
• https://www.ftc.gov/system/files/ftc_gov/pdf/adobe_complaint.pdf
• https://consumer.ftc.gov/consumer-alerts/2024/05/adobe-used-hidden-fee-trap-people-paying-subscription-plans-ftc-says
• https://www.theverge.com/2024/6/17/24180196/adobe-us-ftc-doj-sues-subscriptions-cancel
• https://www.cbsnews.com/news/adobe-ftc-federal-lawsuit-cancel-subscription/
• https://nypost.com/2024/06/17/business/feds-sue-photoshop-owner-adobe-over-subscription-plans-hefty-termination-fees/

 

Image: Andreistanescu | Dreamstime.com

 

[Guest So how do i cancel?]

I have an adobe account that I can't cancel because then I don't get my photos. it is way too much. I was just looking at it yesterday, and the money i am spending

for nothing is unreal. How do get out of it? 

[Guest Adobe bait and switch]

As a student, my wife, obtained an EDUCATION EDITION Adobe Creative Suite 5.5 Master Collection.  This is for two devices and worked well allowing us access to most Adobe products, but when one of the computers was damaged and needed to be replaced we encountered a message from Adobe that the product would no longer work, unless we purchased the subscription.  This I refused and soon had the software, which we purchased, rendered inert.  They had taken a product that we were using scholastically and stripped it from our system.