The FTC has sued Adobe in federal court, alleging that the Photoshop titan and two of its executives defrauded artists by hiding termination fees for its subscription software.
US sues Adobe over subscription fees
The complaint, filed by the US Department of Justice on Monday and made public in redacted form, alleges that "Adobe fails to adequately disclose to consumers that by signing up for the 'Annual, Paid Monthly' ('APM Plan' ) agree to a year-long commitment and a hefty early termination fee ('ETF') that can run into the hundreds of dollars."
If true, then Adobe hit subscribers with, for them, unexpected costs if they simply canceled a pay-per-month plan before the end of the year.
The company's practices, it said, thus trapped creatives in subscriptions they no longer wanted, in violation of e-commerce legislation signed into law in late 2010, the Restore Online Shoppers' Confidence Act. That legislation restricts the use of "negative opt-out features" — taking consumer inaction as a sign of consent — and sales by a third-party merchant that obtained customer data immediately after a transaction with another provider.
