The U.S. Department of Justice is suing Adobe, alleging that the company makes it difficult for customers to cancel subscriptions and doesn’t tell them about a pricey early termination fee until they try.
The DOJ filed a complaint on Monday calling out Adobe’s “Annual, Paid Monthly” plan, which Adobe enrolls customers in by default.
The plan costs $59.99 per month or $719.88 per year and is framed by two alternatives priced at $89.99 per month or $659.88 per year — making it an appealing, lower-cost option in comparison.
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The issue is that there’s an early termination fee (ETF) which can cost several hundreds of dollars if subscribers try to end the payments early. And Adobe doesn’t make it clear that the ETF applies when subscribers first sign up, per the filing.
“Adobe clearly discloses the ETF only when subscribers attempt to cancel… trapping consumers in subscriptions they no longer want,” the filing stated.
The filing further alleges that Adobe prevents subscribers from ending their plans by making the cancellation process “onerous and complicated.”
The DOJ accuses Adobe of breaking federal consumer protection laws and asked Adobe to cancel its subscription contracts, issue refunds, and pay other relief.
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Adobe has more than 60% of the global market share in application development, more than Microsoft, and raked in more than $19 billion in revenue last year.
Of that revenue, 94%, or $18.28 billion, came from subscriptions.
The filing illustrated the frustration customers have experienced when they tried to cancel their Adobe subscriptions.
“Adobe literally will not let me cancel my subscription,” one person reported, adding that when they tried to cancel online, they were put through a “loop to continually sign in and cannot move forward to cancel.”
3. Adobe knew its policies made it extraordinarily difficult and frustrating for users who wanted to cancel their subscriptions.
Customers described a variety of obstacles. One person wrote, “Adobe literally will not let me cancel my subscription.”https://t.co/SIRC0n3EgY pic.twitter.com/53uF9D2RKv— Lina Khan (@linakhanFTC) June 17, 2024
Adobe knew about these complaints, and others, caused by its cancellation policies — but “has nevertheless persisted in its violative practices to the present day,” the DOJ alleged.
Adobe recently faced controversy for its terms and agreements, which appeared to give the company full access to user content. Adobe updated the terms on Tuesday.
