Uber is accused of using a “deceptive billing and cancellation process” for its Uber One subscription service, according to a lawsuit filed Monday by the U.S. Federal Trade Commission.
The taxi company signed people up for its subscription service and then charged them without their consent, making it difficult to cancel the service, the agency alleges in its lawsuit. The FTC is asking the court to issue a permanent injunction that would prohibit Uber from continuing to enroll people in its subscription program, as well as provide unspecified monetary relief to victims of the policy.
“Americans are tired of being signed up for unwanted subscriptions that seem impossible to cancel,” said FTC Chairman Andrew Ferguson in a statement. “The Trump-Vance FTC is fighting back on behalf of the American people. Today we allege that Uber not only deceived consumers about their subscriptions, but also made it unreasonably difficult to cancel them.”
According to the FTC, Uber used hard-to-read text and misleading promises of savings to lure people into its subscription service. When signing up for Uber, customers are “falsely promised” savings of $25 per month, which does not correspond to the subscription cost of $9.99 per month. The company also “hides important subscription information,” including “using small gray text that consumers can easily miss.” Many customers told the FTC that they were signed up without their consent, and one customer said he was charged despite not even having an Uber account.
After signing up, Uber allegedly charged customers until the billing date, and sometimes until the free trial period ended. And when customers tried to cancel, Uber made it “extremely difficult,” the FTC claims.
“Some users are told that they must contact customer service to cancel their subscription, but are not given any opportunity to contact them,” the agency notes, “others claim that Uber billed them for another billing cycle after they requested to cancel their subscription and waited to hear back from customer service.”
Uber claims that these allegations are false and that customers can cancel their subscription without any difficulty. The company also denies registering and charging customers without their consent.
“We are disappointed that the FTC has decided to pursue this case, but we are confident that the courts will agree with what we already know: Uber One’s sign-up and cancelation processes are clear, simple, and comply with the letter and spirit of the law,” said Uber spokesperson Noah Edwardsen. “Uber does not register or charge customers without their consent, and canceling a ride can now be done at any time in the app and for most people will take no more than 20 seconds.”
The company also provided statements from former FTC officials that echoed similar sentiments. “I am disappointed that the FTC has decided to bring this case without conducting a full investigation and is basing its complaint on a misunderstanding of both the facts and the law,” said Tim Muris, former FTC Chairman, Director of the Bureau of Consumer Protection and Director of the Bureau of Competition, and now a senior counsel at Sidley, who represented Uber during the investigation.
