Company Says Consumer Confidence Civil Action Will Be Fought
CALIFORNIA — The federal government has sued software maker Adobe, alleging the company profited for years from hidden fees protected by a maze of complicated online links.
An early termination fee “imposed” on millions of Adobe subscribers made it difficult and costly for them to cancel products they no longer wanted, the Justice Department and Federal Trade Commission charge in the civil action.
But in a Monday statement, Adobe described its services as “convenient” and “cost effective.” Adobe’s General Counsel Dana Rao added that the government’s claims will be challenged as the company’s subscriptions are “transparent” and easy to cancel.
Two top Adobe executives are also named in the lawsuit — Digital Media Business President David Wadhwani and marketing vice president Maninder Sawhney.
The lawsuit alleges Adobe’s early termination fee was “hefty” and that the company violated the Restore Online Shoppers’ Confidence Act by hiding important subscription information in fine print and through hard-to-notice hyperlinks.
Adobe’s actions have misled consumers for years about the “true costs” of subscribing to the company’s software products and deprived them of a simple way to end subscriptions before they automatically renewed, the civil lawsuit charges.
“Instead, Adobe allegedly protects its subscription revenues by thwarting subscribers’ attempts to cancel, subjecting them to a convoluted and inefficient cancellation process filled with unnecessary steps, delays, unsolicited offers and warnings,” a DOJ news release states.
The lawsuit seeks to end Adobe’s current fee practices and also asks for unspecified monetary damages for consumers.
“The Justice Department is committed to stopping companies and their executives from preying on consumers who sign up for online subscriptions by hiding key terms and making cancellation an obstacle course,” Brian M. Boynton, head of the Justice Department’s Civil Division, stated in the release.
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