- The Adobe 2024 case soon to be closed, at the price of a settlement of 150 million dollars
- Customers will benefit from $75 million in free services
- Adobe disagrees with the allegations, but is happy to close the case
The US Department of Justice has filed a proposed order to settle a lawsuit against Adobe and two of its executives – Maninder Sawhney and David Wadhwani – for alleged deceptive subscription practices.
The $150 million settlement is split evenly into two parts: $75 million in civil penalties and an additional $75 million in free services to customers.
The allegations (according to the Department of Justice) assert that Adobe’s practices violated the Restore Online Shoppers’ Confidence Act (ROSCA), which “generally requires companies offering online subscriptions to clearly disclose important subscription information and provide subscribers with easy ways to cancel.”
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$150 million settlement from Adobe
The lawsuit alleges that Adobe accessed key subscription details, including early termination fees, using “inconspicuous fine print and hyperlinks.” Early termination fees for Adobe’s annual plans could run into the hundreds of dollars.
In addition to hiding some details, regulators also claimed that Adobe made cancellations difficult through complex processes, including multiple web pages, phone cancellations and delays.
In addition to paying $150 million, Adobe must also clearly disclose early termination fees and how they are calculated before listing. The company was also tasked with reminding users before their free trials became paid plans, giving them easier ways to cancel.
However, the settlement has not yet been confirmed and is awaiting court approval.
“American consumers deserve the right to make informed choices when deciding where to spend their hard-earned dollars,” wrote Assistant Attorney General Brett A Shumate.
“While we disagree with the government’s assertions and deny any wrongdoing, we are happy to resolve this issue,” Adobe added in a statement. “We are transparent about the terms and conditions of our subscription contracts, have a simple cancellation process, and clearly disclose the details of our plans.”
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