(NewsNation) — The Federal Trade Commission has filed a lawsuit against Uber, accusing the company of using deceptive billing and cancellation practices tied to its subscription service.
The ride-sharing and delivery company offers a subscription service of $9.99 per month called Uber One, which offers discounts on fees associated with the app’s features.
Discord accused of exposing kids to graphic, violent content in lawsuit
The FTC said Uber falsely claimed users would save $25 through the service, charged customers before their billing date and made it difficult for users to cancel the service despite its “cancel anytime” promises.
“Americans are tired of getting signed up for unwanted subscriptions that seem impossible to cancel,” FTC Chair Andrew N. Ferguson said in a statement. “The Trump-Vance FTC is fighting back on behalf of the American people.”
Uber’s practices violate Restore Online Shoppers’ Confidence Act: FTC
In its lawsuit, the FTC alleged the company’s practices violate the FTC Act and the Restore Online Shoppers’ Confidence Act, requiring online retailers to clearly explain the terms of the service they are selling, to get consumers’ consent before charging them for a service and to make it easy to cancel a recurring subscription.
IMF lowers economic growth forecast over tariff instability
The FTC said customers might have to navigate “as many as 23 screens and take as many as 32 actions” to cancel their Uber One subscription. However, according to the BBC, Uber spokesperson Ryan Thornton said, “Cancellations can now be done anytime in-app and take most people 20 seconds or less.”
Previously, customers would have had to contact Uber’s customer service department within 48 hours of the next billing period.
Uber has been hit with lawsuits in the past, settling a recent case filed by the DOJ in 2022 in which the Justice Department alleged the company was discriminating against some customers by charging “wait fees” when they needed more time to get in a vehicle due to a disability.
Walgreens settles allegations around opioid prescriptions for $300M: DOJ
According to the New York Times, Uber spokesperson Noah Edwardsen responded to the lawsuit, saying, “We are disappointed that the FTC chose to move forward with this action. Uber One’s sign-up and cancellation processes are clear, simple and follow the letter and spirit of the law.”
Uber officials also reportedly said the company “does not sign up or charge consumers without their consent.”
Uber has faced allegations from FTC before
This is not the first time Uber has had to deal with the FTC, according to Fortune. In 2017, Uber settled allegations that it had not been completely truthful about its security practices.
The company was directed to pay $20 million in 2018 for claims that potential earnings for drivers had been exaggerated during recruitment.
A federal emergency housing program is running out of money — fast
In 2022, Uber allegedly avoided criminal charges when it was found that employees did not disclose a data breach in 2016 that affected over 55 million users and Uber drivers. In that case, the company also reached a settlement.
The FTC said its commission only files a complaint when it has “reason to believe” a company is violating — or about to violate — the law. The case will ultimately be decided in court.
