US sues Adobe for hiding termination fees and making it difficult to cancel subscriptions

The U.S. Department of Justice has filed a lawsuit against Adobe alleging that the company deceives consumers by hiding the early-termination fee and making it difficult for people to cancel their subscriptions.

In the complaint filed on Monday, the DOJ wrote that “Adobe has harmed consumers by enrolling them in its default, most lucrative subscription plan without clearly disclosing important plan terms.”

The government says Adobe pushed consumers toward the “annual paid monthly” subscription without informing them that canceling the plan in the first year would cost hundreds of dollars.

Adobe only discloses the early-termination fees when subscribers attempt to cancel, and turns the early-termination fee into a “powerful retention tool” by trapping consumers in subscriptions that they no longer want, the complaint says.

“During enrollment, Adobe hides material terms of its APM plan in fine print and behind option textboxes and hyperlinks, proving disclosures that are designed to go unnoticed and that most consumers never see,” according to the complaint. “Adobe then deters cancellations by employing an onerous and complicated cancellation process.”

Adobe says it plans to refute the claims in court.

“Subscription services are convenient, flexible and cost effective to allow users to choose the plan that best fits their needs, timeline and budget,” said Adobe’s General Counsel and Chief Trust Officer Dana Rao, in a statement. “Our priority is to always ensure our customers have a positive experience. We are transparent with the terms and conditions of our subscription agreements and have a simple cancellation process.”

The DOJ’s complaint says Adobe has violated federal laws designed to protect consumers. The government is seeking “injunctive relief, civil penalties, equitable monetary relief, as well as other relief.”

Adobe shifted to a subscription model in 2012 and started requiring consumers to pay for access to the company’s software on a recurring basis. In the past, users could access the company’s software after paying a one-time fee.

Subscriptions account for most of the company’s revenue, according to the Federal Trade Commission, which launched a similar lawsuit against Amazon last year, saying it “knowingly” complicates the ability of customers of its Prime service to cancel their subscriptions.