(NewsNation) — The Federal Trade Commission has filed a lawsuit against Uber, saying it used deceptive billing and cancellation practices tied to its subscription service.
The rideshare and delivery company has a subscription service for $9.99 per month called Uber One, which offers discounts on fees associated with the app’s features.
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The FTC said Uber falsely claimed that 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 Chairman Andrew N. Ferguson said in a statement. “The Trump-Vance FTC is fighting back on behalf of the American people.”
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In its lawsuit, the FTC alleged the company’s practices violate the FTC Act and the Restore Online Shoppers’ Confidence Act (ROSCA), requiring online retailers to clearly explain the terms of the service they are selling, get consumers’ consent before charging them for a service and make it easy to cancel a recurring subscription.
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The FTC said customers might have to navigate through “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.”
Before, 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 one filed by the DOJ in 2022 when the Justice Department alleged the company was discriminating against customers with a disability by charging “wait fees” when they needed more time to get in a vehicle due to their disability.
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According to the New York Times, an 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 that 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 that Uber has had to deal with the FTC, according to Fortune. In 2017, Uber settled allegations that it hadn’t been completely truthful about its security practices.
The company had to pay $20 million in claims in 2018 for claims that potential earnings for drivers had been exaggerated during recruitment.
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And, in 2022, Uber allegedly avoided criminal charges when it was found that employees didn’t disclose a data breach in 2016 that affected over 55 million users and Uber drivers. In that case, they also reached a settlement.
The FTC did say that its commission only files a complaint when they have “reason to believe” a company is violating (or about to violate) the law. The case will ultimately be decided in court.
