FTC Files Lawsuit Against Uber Over Alleged Subscription Deception

The lawsuit marks a significant move in consumer protection efforts against major tech companies.

The U.S. Federal Trade Commission (FTC) has launched a lawsuit aimed at Uber, charging the ride-hailing and delivery giant with deceptive subscription practices. The regulatory body claims Uber has been improperly billing customers for its Uber One subscription service without obtaining proper consent and complicating the cancellation process.

FTC Chairman Andrew Ferguson emphasized the agency's commitment to consumer protection, suggesting that the lawsuit represents a proactive step on behalf of American consumers. In response, an Uber spokesperson expressed disappointment with the FTC's decision, asserting the company's innocence regarding the allegations.

Introduced in 2021, the Uber One subscription service offers users benefits like free delivery and discounts on rides for a monthly fee of $9.99 or an annual subscription of $96. According to the FTC’s complaint, customers attempting to cancel their subscriptions often face a frustratingly complex system that can require as many as 23 screens and up to 32 different actions.

Uber has countered the agency's claims by stating that cancellations can now be completed through the app and typically take just 20 seconds, a significant change from earlier practices that required contacting customer support within 48 hours of the billing cycle.

Additionally, the FTC alleges that numerous consumers found themselves enrolled in Uber One without their consent, citing one case in which a person reported being charged without even having an Uber account. In its defense, Uber maintains that they do not sign up or charge individuals without explicit consent.

This lawsuit represents the FTC's first major legal action against a prominent tech company since Donald Trump's inauguration for his second term in January. The suit contrasts with ongoing litigation against Meta, which revolves around the company's historical acquisitions of Instagram and WhatsApp, addressing anti-competitive practices in the social media landscape. Meta has dismissed the FTC's allegations as misguided.