The U.S. Department of Justice (DOJ) filed a lawsuit against Adobe Inc. and two of its executives Monday for alleged unfair business practices that squeeze profit from customers.
According to the DOJ complaint, Adobe systematically violated the law by hiding crucial details about its subscription plans through fine print and obscure hyperlinks.
"For years, Adobe has harmed consumers by enrolling them in its default, most lucrative subscription plan without clearly disclosing important plan terms," the court document stated.
The complaint also says that the tech giant consistently failed to disclose an Early Termination Fee that customers receive when canceling subscriptions, essentially trapping subscribers.
Additionally, Adobe reportedly complicated the cancellation process by intentionally giving users a hard time with unnecessary steps, delays, and unsolicited offers to inflate its subscription revenues.
The DOJ Seeks Reparations
The DOJ is seeking equitable monetary relief for customers, civil penalties for the defendants, as well as a permanent order to prohibit Adobe from further violations.
"We will continue to enforce ROSCA against those who engage in such misconduct," said Principal Deputy Assistant Attorney General Brian M. Boynton, head of the DOJ’s Civil Division.
"No company, whether it is a small business or a member of the Fortune 500 like Adobe, is above the law," he continued.
It must be noted that about a week before the DOJ filed its lawsuit, Adobe made an effort "to address customer concerns" by updating its terms of use.
Sharing an update on changes and clarifications coming to Adobe's Terms of Use to address customer concerns. As technology evolves, so must our Terms of Use. Learn more: https://t.co/NYx1LjAYPdpic.twitter.com/Ci1IX6XCpZ
— Adobe (@Adobe) June 10, 2024
In response to the lawsuit, Adobe plans to refute the allegations in court.
The company's general counsel, Atty. Dana Rao, defended the company's subscription services, calling the subscription services "convenient, flexible, and cost-effective to allow users to choose the plan that best fits their needs, timeline, and budget."
Adobe has restricted customer access to its software behind a paywall ever since it scrapped the one-time payment model in 2012.
According to the Federal Trade Commission, Adobe's main source of revenue is subscriptions.
The FTC has similarly pursued legal action against other companies like Amazon, alleging difficulties in canceling subscriptions for Prime service customers.
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Editing by Katherine 'Makkie' Maclang
