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The US FTC files a lawsuit against Adobe for its alleged deceptive subscription plans

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The Adobe software company is facing a lawsuit filed today by the US Federal Trade Commission. The government agency claims Adobe hides early termination fees for its software subscription plans. It also claims the company makes it very hard to cancel those plans.

In a press release announcing its lawsuit, the FTC stated Adobe has made most of its revenue with its subscription plans for over a decade. However, the agency claims the company has been trying to push consumers to sign up for what it called an "annual paid monthly” plan. Each month, your credit card or bank account pays for the plan, but it's supposed to be for an entire year.

The FTC alleges that when consumers try to cancel an Adobe plan under these terms before the year is over, they get hit with high early termination fees amounting to 50 percent of the remaining monthly payments. The press release added:

Adobe’s ETF disclosures are buried on the company’s website in small print or require consumers to hover over small icons to find the disclosures.

The FTC says the agency and the Better Business Bureau have received complaints about this situation from many consumers. It also says Adobe is aware of these complaints but continues with this subscription plan structure and hiding the early termination fee.

In addition, the FTC claims Adobe makes it very difficult for consumers to cancel a plan. It stated:

When consumers have attempted to cancel their subscription on the company’s website, they have been forced to navigate numerous pages in order to cancel. When consumers reach out to Adobe’s customer service to cancel, they encounter resistance and delay from Adobe representatives. Consumers also experience other obstacles, such as dropped calls and chats, and multiple transfers. Some consumers who thought they had successfully cancelled their subscription reported that the company continued to charge them until discovering the charges on their credit card statements.

According to the FTC, Adobe's actions violate the US's Restore Online Shoppers’ Confidence Act. Besides the company, the lawsuit also names two of its executives. One is Maninder Sawhney, the company's senior vice president of digital go-to-market and sales. The other is David Wadhwani, who is Adobe's president of its digital media business.

As of this writing, Adobe has yet to respond to the lawsuit.

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