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Automatic Subscription Renewal Programs


Consumers who have unwittingly entered into automatic renewal agreements may be eligible to file a lawsuit against companies that mislead their customers into such agreements. Various states have consumer protection laws prohibiting companies from automatically renewing subscriptions without obtaining the customer's express consent or by not adequately explaining the terms and conditions. Further, there are federal laws that protect consumers and give regulators the ability to go after companies that violate consumer trust.

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Automatic Subscription Renewal

Companies in a variety of sectors, including online services, delivery subscription services, and television and entertainment streaming, use automatic subscription renewal policies. Customers enroll and are then automatically charged periodically (monthly, for example) for continuous service. Companies that use automatic subscription renewal say the system benefits customers by being an easy and efficient way to continue services. But customers must be aware they are agreeing to an automatic renewal, and they must be made aware of the cancellation procedures.

Automatic Subscription Renewal Laws

autorenewalState laws regarding automatic subscription renewal vary. Consumers in California are protected by the California Business and Professions Code, Section 17600, which states companies must disclose the automatic renewal terms in a clear and conspicuous manner before the agreement is completed, and that the terms must be in visual proximity to the consent for the agreement. In other words, the terms of the automatic renewal cannot be buried in the other terms and conditions on a different page of the website. Furthermore, companies cannot charge a customer's credit card, debit card or bank account on an ongoing basis without express consent.

In New York, S.B. 40 also states that customers must give their express consent before companies can charge for renewal services.

Federally, there are laws protecting consumer's rights. Under the Federal Trade Commission Act, 15 U.S.C. Section 41, companies must clearly disclose their automatic renewal policies. Congress' Restore Online Shoppers' Confidence Act gives the FTC and state attorneys general the ability to penalize companies who use negative option features (in which companies use a customer's silence as acceptance of a renewal) in their automatic renewal program. It also prohibits companies from turning a free trial into a paid subscription without getting the customer's consent.

Free Trial Periods

freetrialautorenewIn addition to concerns about automatic renewal services are concerns about free trials being turned into paid subscriptions without obtaining the customer's consent, without adequately explaining the cancellation process to the customer, or without providing proper time to cancel before the trial period expires.

Some companies, for example, are accused of offering products on a short trial period, but not telling customers they will be charged full price for the goods after the trial period expires or that they will be charged a restocking fee when they return goods. In some cases, customers say their goods do not even arrive within the trial period, so by the time their goods arrive, the free trial is already over and there is no time to cancel.

Automatic Renewal Lawsuits

In December 2014, Sirius XM agreed to pay $3.8 million to various states to settle allegations about the company's automatic subscription renewal policies. In 2015, LIFELOCK reached a preliminary settlement in a lawsuit alleging it violated California Unfair Competition Law.

Also in 2015, a lawsuit was filed against Neopets, alleging unfair business practices for failing to warn about continuous renewals.

Customers who have unknowingly signed up for automatic renewal services or have been misled by the terms and conditions of an automatic renewal may be eligible to file a lawsuit against the company or companies involved.

Subscription Program Auto-Renewal Legal Help

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AUTO-RENEWAL PROGRAM LAWSUITS

Neopets Faces Class Action Over Unfair Subscription Practices

Norton Internet Security allegedly has pop ups that cause subscribers to pay multiple times for subscriptions.

O Magazine, Hearst Corporation and Hearst Magazines allegedly employed a scheme to deceive subscribers into paying un owed money.

AUTO-RENEWAL PROGRAM LEGAL ARTICLES AND INTERVIEWS

Time for Consumers to Litigate Against the Autorenewal Clause, Lawyer Says
Time for Consumers to Litigate Against the Autorenewal Clause, Lawyer Says
November 25, 2017
Los Angeles, CA: Not a week goes by that attorney Francis (Casey) Flynn doesn’t get up to ten phone calls from irate consumers complaining about an autorenewal clause for some product or service they purchased and then find they can’t get rid of it no matter how hard they try [READ MORE]

No Need to “Renew” Their Angst: Auto-Renewal Plaintiffs Remain Vigilant
No Need to “Renew” Their Angst: Auto-Renewal Plaintiffs Remain Vigilant
February 11, 2016
San Diego, CA: Promoters of automatic renewals tout the convenience of ensuring continued service for busy consumers who otherwise might forget to renew a valued service on their own. Critics, however, counter that service providers are taking advantage of technology and online commerce to milk additional revenues from unsuspecting consumers. Little wonder many turn to an Auto-Renewal lawsuit [READ MORE]

Automatic Renewals Are a Runaway Freight Train, but Lawsuits Are Fighting Back
Automatic Renewals Are a Runaway Freight Train, but Lawsuits Are Fighting Back
January 30, 2016
Sacramento, CA: The passage of California’s automatic-renewal law in 2010 and the rise in class-action lawsuits that have resulted is indicative of a transition by an increasing number of retailers and service providers to a model that was once the bastion of the magazine industry. And while service providers appear to finally be getting the message that terms need to be communicated to the consumer in a clear and conspicuous manner, more and more consumers are turning to the courts and filing a California Auto-Renewal Lawsuit after getting dinged with charges of which they were unaware of or never agreed to, or so it is alleged [READ MORE]



READER COMMENTS

Posted by
Elizabeth
on
Sirius XM is the worst. I sold a vehicle that had built-in XM radio, so of course wanted to cancel my month-to-month auto-renewing service for that car. It took me over two hours on the phone for them to finally cancel it. They just kept trying to upsell me on different plans or badgering me into keeping the service, despite my continual explanations that *I no longer own the car*! I really like having Sirius XM in my vehicle, but the experience was so bad I might forego ever subscribing again.

For annual auto-renewals like Adobe CC or McAfee, I just wish there was a law requiring them to email me a reminder that I have an upcoming renewal and will be charged $x on x date. I've set up reminders in my phone a year out for auto-renewal dates, but have lost that info during factory resets or phone upgrades. It's hard to track/remember things a year out. Some companies voluntarily provide this courtesy, although it seems uncommon, but I really appreciate the reminder and the opportunity to unsubscribe ahead of time, or just to properly budget for it. Financial situations can change a lot in a year, and it's so professional and *kind* when companies issue a reminder rather than let you be surprised with nonrefundable charges. I'd love to see these reminders be a required part of all auto-renewal agreements.

On that note, I did have a reminder set about an Adobe CC auto-renewal, but when I went into my account I did not have any options in there to turn off auto-renewal, and the help guide showed a "cancel" button that was not present on my screen. I took screen captures of the discrepancy. Not cool.

Posted by
Melissa Boggs
on
Sirius XM is easy to cancel, you just need to call them. I canceled in less than 5 minutes. Then went back to them when they offered an awesome deal.

Posted by
Dana
on
I too, have had a major issue with Symantec ( Norton Antivirus Renewal Service)- only I haven't gotten any email notifications on an old email account that I don't even use anymore . I checked the account- there are no notifications. I have been on their site several times to stop the automatic renewal - to no avail. I haven't had a PC since 2009. They have been charging me EVERY YEAR- and what is worse- the price has increased each year- to the tune of over one thousand dollars over an 8 year period. I know this because my credit card company did a look-back for me. I only became aware of the issue on a credit card statement recently that haven't used for almost a half a year had a charge on it that I did not recognize- when I downloaded my credit card statement lo and behold- the NORTON charge.- AGAIN. What's worse- I have NEVER received a notification from the company via email of the charge. When I was on a text-message with the company they couldn't even tell me what their procedure was for responding to complaints and what reasonable time frame could I expect a response from their "higher department". He wouldn't name that higher department nor would he give me a time frame in which I could expect a phone call response. In my view- these auto-renewal subscriptions lack transparency and have not received my express permission. I am leery of any business that practices such tactics, but now it seems every business has gotten on the bandwagon. However, one company that has handled the auto-renewal responsibly is Amazon- each month the opt out is clearly visible on their site and they notify me of the charge. I am awaiting a review of my credit account records from my card company and then I will see which action I will pursue.

Posted by
sean
on
SiriusXM subscription here. I agreed to the automatic, monthly, renewal. Now no longer wish to use their service and I cannot find a link to cancel the service. I logged into the site and there is NO links to click to cancel. How do I cancel? I'm confused and they will keep charging me until I cancel...

Posted by
Christopher
on
I just had a 2 day battle with adobe over their auto renewal of a subscription. I just cant believe what companies are getting away with. I wasn't the only one trapped into paying every month for another full YEAR at 30 to 50 bucks a month!! No wonder adobe reported record profits last year,

Adobe Reports Record Revenue
Tuesday, June 21, 2016 4:05 pm EDT
Strong Adoption of Cloud Solutions Drives 20 Percent Year-over-year Revenue Growth

- See more at: http://news.adobe.com/press-release/corporate/adobe-reports-record-revenue-1#sthash.aljF0JdP.dpuf

This website helped arm me with the information i needed to get these vultures to finally cancel my sub without the 150$ fee. thank you very much

Posted by
Linda Murphy
on
Comcast Does it all the time they did it to me more then one time they never let you know My Bill is so high for the same bundles new Customers pay less i been asking why .

Posted by
Kat
on
Beware of Symantec / Norton Automatic Renewal Service! Every year when I pay for my subscription, Norton "changes" my settings in my online account, to Opt-Out on their Automatic Renewal Service, without my consent. Norton "automatically" includes their Automatic Renewal Service, each time you pay for a new subscription. So every year, I have to go online, and CHANGE it back to Do Not Automatically Renew my subscription. There should be a law that prevents companies from changing your personal settings, in your online account, without your consent! Norton does send me an email stating thank you for your subscription, and it came with an Automatic Renewal Service, however, I should not have to "reset" my Opt-Out, each time I pay for my subscription! I have been a customer of Norton Security Anti-Virus for over a decade, and you would think by now, Norton would understand I do not want their Automatic Renewal Service!

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