Adobe has agreed to a $150 million settlement to resolve a U.S. government lawsuit that accused the company of making it unnecessarily difficult to cancel its subscriptions. According to their statement, the agreement includes $75 million in civil penalties to the U.S. government and an additional $75 million worth of free services to affected customers.
The case arose from a 2024 lawsuit by the Justice Department and the Federal Trade Commission over Adobe’s subscription practices. Regulators alleged that Adobe concealed early cancellation fees and created complicated cancellation processes, violating the Restore Online Shoppers’ Confidence Act (ROSCA), which requires companies to clearly disclose subscription terms and provide straightforward cancellation options.
Why did regulators sue Adobe over its subscriptions?
The lawsuit focused primarily on Adobe’s “annually paid monthly plans,” which offer a discounted rate but require a one-year commitment. Authorities said the company did not clearly disclose the early termination fee, which could amount to hundreds of dollars if users cancel early.
Regulators also alleged that Adobe made it unduly difficult to cancel subscriptions by requiring customers to go through a complex series of steps, warnings and offers. Fortunately, the settlement also requires Adobe to clearly disclose cancellation fees upfront, remind customers before converting free trials to paid plans, and provide easier ways to cancel subscriptions in the future.
What does Adobe say about the comparison?
Adobe says the settlement closes the case but insists nothing wrong was done. In a statement, the company said it remains committed to clearer subscription options and greater transparency and plans to contact eligible users about the $75 million in free services once the deal receives court approval.
Nevertheless, this episode also shows how subscription models are increasingly coming into focus. As more software companies rely on recurring plans, regulators are pushing for clearer pricing and easier cancellations. Hopefully this means the days of “easy to subscribe, hard to cancel” are finally numbered.
