The Federal Trade Commission (FTC) has initiated legal action against Uber, charging the ride-hailing and delivery company with allegedly enrolling customers in its Uber One subscription service without their consent. The lawsuit further asserts that Uber did not deliver the claimed savings associated with the subscription and created unnecessary obstacles for users attempting to cancel their subscriptions, despite promises of a “cancel anytime” policy.
Uber has categorically refuted the allegations, claiming that the FTC has hastily conducted its investigation based on unverified claims. This legal move aligns with the FTC’s recent focus on making subscription cancellation processes more consumer-friendly, a strategy reinforced during the tenure of former director Lina Khan. In October 2024, the agency introduced its “click to cancel” rule, mandating that cancelling a subscription should be as effortless as signing up for one. Despite facing challenges from industry representatives, this rule is expected to be implemented by 14 May.
According to FTC Chairman Andrew Ferguson, consumers are frustrated with unwanted subscriptions that are difficult to cancel, asserting that the agency is acting in the interests of the public. The FTC’s complaint arises from a year-long investigation, alleging that Uber misrepresents the actual savings of $25 per month while neglecting to factor in the subscription cost, which can be as high as $9.99 monthly. Furthermore, the agency claims that Uber obscures critical information regarding its subscription in small, easily overlooked text.
The complaint also highlights that Uber automatically charges customers who registered for a free trial without prior approval. Customers often find the cancellation process burdensome, reportedly having to navigate as many as 23 screens and complete up to 32 steps to finalize their cancellation. Many users have recounted difficulties, such as being unable to access customer support or receiving charges for another billing cycle despite having requested cancellation.
Uber has indicated that it has improved its cancellation policy; previously, customers within 48 hours of signing up had to contact customer support to cancel, whereas this process is now integrated into the app. The plaintiffs in the case are seeking to halt what they deem deceptive practices and push for monetary compensation.
In response, Uber expressed disappointment in the FTC’s decision to proceed with the lawsuit but maintains confidence in the clarity and legality of its registration and cancellation processes. Uber spokespersons insist that the company does not enroll or charge customers without their consent and that most cancellations can now be processed within approximately 20 seconds through the app.
Former FTC chairman Tim Muris, who represented Uber during the investigation, has criticized the FTC for not conducting a thorough investigation and basing its claims on inaccuracies. Current outside counsel for Uber, Christine Wilson, has also asserted that the FTC’s process was rushed and missed crucial facts, claiming that the agency’s conclusions deviate from its established standards of fairness and rigor.
Uber One, the subscription service in question, reportedly had a membership base of 30 million across 34 countries by 2024, with a projected revenue exceeding $1 billion that year as stated by Uber’s CEO.
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