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The US government has taken legal action against software heavyweight Adobe for allegedly violating consumer protection laws, including the imposition of a difficult cancellation process.
It has been claimed the US multinational computer giant has hidden expensive fees to cancel early, as well as failing to provide clarity on terms and length of subscriptions.
The action has been taken by the Federal Trade Commission (FTC), the government agency that acts with autonomy to uphold civil antitrust laws and consumer protections. It claims Adobe has refused to change its methods for financial reasons but the company has refuted this claim, as part of a fight against the lawsuit.
Adobe’s General Counsel and Chief Trust Officer Dana Rao stated, “We are transparent with the terms and conditions of our subscription agreements and have a simple cancellation process.”
“We will refute the FTC’s claims in court,” he said.
In recent days, Adobe has experienced the biggest gain in its share price for four years after strong projections were made for the upcoming year on the back of demand for its new range of artificial intelligence-based tools.
At the time of writing, the share price is sitting at 518.74 USD.
1. @FTC has taken action against Adobe and two executives for pushing people into subscriptions and then making it absurdly hard to cancel.
Adobe ambushed users with hefty "early termination fees" and threw up obstacles when people tried to cancel.https://t.co/lyWAv4GMm1
— Lina Khan (@linakhanFTC) June 17, 2024
‘Trapped customers into year-long subscriptions’
Adobe has had a subscription-based sales model in place since 2012, asking users to pay an annual or monthly fee but there has been acrimony due to ambiguity with the sign-up process and then similar frustration with cancellations.
When customers attempt to cancel, the company allegedly moves through a “convoluted process”, requesting re-entry of their password and navigation past multiple pop-up screens.
“Adobe trapped customers into year-long subscriptions through hidden early termination fees and numerous cancellation hurdles,” outlined Samuel Levine, director of the FTC’s Bureau of Consumer Protection.
“Americans are tired of companies hiding the ball during subscription signup and then putting up roadblocks when they try to cancel,” said Levine.
Earlier this month, Adobe moved to clarify its terms and conditions after users expressed outrage when they were denied access to its products without agreeing to an updated T and C document.
The controversy stemmed from a provision in the document stating that Adobe could access users’ content using both “automated and manual methods.”
Image credit: Ideogram
