Adobe has settled a 2024 lawsuit from the US government that alleged the company used hidden fees to trap users into paying for subscriptions.
On Friday, Adobe “finalized” an agreement with the Justice Department, which accused the software vendor of failing to inform new customers about payment terms or early termination fees. “While we disagree with the government’s claims and deny any wrongdoing, we are pleased to resolve this matter,” Adobe says.
The announcement adds that Adobe will “provide $75 million worth of free services to customers that qualify. We will proactively reach out to the affected customers once the appropriate filings with the Court are made and accepted.”
Adobe didn’t reveal who is eligible for the offer. But the free service stipulation is briefly mentioned in the settlement agreement, which was filed today.
The agreement targets Adobe’s use of “negative options,” a practice in which a consumer’s silence or failure to cancel is treated as consent for the company to charge recurring subscription fees. The settlement blocks Adobe from using the tactic with its subscriptions, including for free trials. Instead, the company will need to clearly disclose the terms, including early cancellation fees, to customers before obtaining billing information.
In addition, the agreement bans Adobe from hiding such disclosures through links or separate windows on its website. The order also requires the company to give advance notice and send email notifications to free-trial users that they’ll eventually be converted to a paid subscription plan. Another important requirement is for Adobe to implement a simple cancellation process.
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On top of all this, Adobe will pay the US government an additional $75 million civil penalty. The Justice Department didn’t immediately respond to a request for comment about whether any of that $75 million will be returned to affected consumers.
The Justice Department filed the lawsuit on a referral from the Federal Trade Commission, which noted in 2024 that consumers had spent years complaining about early termination fees for Adobe products. The FTC declined to comment on the settlement.
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Michael Kan
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I’ve been a journalist for over 15 years. I got my start as a schools and cities reporter in Kansas City and joined PCMag in 2017, where I cover satellite internet services, cybersecurity, PC hardware, and more. I’m currently based in San Francisco, but previously spent over five years in China, covering the country’s technology sector.
Since 2020, I’ve covered the launch and explosive growth of SpaceX’s Starlink satellite internet service, writing 600+ stories on availability and feature launches, but also the regulatory battles over the expansion of satellite constellations, fights with rival providers like AST SpaceMobile and Amazon, and the effort to expand into satellite-based mobile service. I’ve combed through FCC filings for the latest news and driven to remote corners of California to test Starlink’s cellular service.
I also cover cyber threats, from ransomware gangs to the emergence of AI-based malware. Earlier this year, the FTC forced Avast to pay consumers $16.5 million for secretly harvesting and selling their personal information to third-party clients, as revealed in my joint investigation with Motherboard.
I also cover the PC graphics card market. Pandemic-era shortages led me to camp out in front of a Best Buy to get an RTX 3000. I’m now following how President Trump’s tariffs will affect the industry. I’m always eager to learn more, so please jump in the comments with feedback and send me tips.
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