Headline RoundupJune 20th, 2024

Why Is the U.S. Government Suing Adobe?

Summary from the AllSides News Team

The Federal Trade Commission (FTC) is suing Adobe Inc., accusing the software company of illegally making subscription cancelations difficult for customers and hiding termination fee information.

The Details: The lawsuit alleges Adobe imposed a hidden early termination fee on millions of its subscribers, subjected them to a complex cancelation process, and used fine print and hyperlinks to conceal important subscription agreement details. These actions, the FTC says, constitute violations of the 2010 Restore Online Shoppers’ Confidence Act (ROSCA), which requires online merchants to disclose material terms and obtain informed consent before imposing charges. 

Key Quotes: An FTC statement on the lawsuit referred to cases where customers were purportedly impeded by Adobe’s subscription process, stating, “Some consumers who thought they had successfully cancelled their subscription reported that the company continued to charge them until discovering the charges on their credit card statements.” Meanwhile, a statement from Adobe’s general counsel and chief trust officer denied the allegations, saying, “We are transparent with the terms and conditions of our subscription agreements and have a simple cancelation process.”

For Context: Adobe, known for software products like its Photoshop and Acrobat, shifted from “perpetual licensing” of software — where buyers had indefinite access to products — to monthly and annual subscription models in 2012. In recent years, Adobe’s revenue from subscription-based software has reportedly nearly doubled, hitting $14.2 billion in 2023.

How the Media Covered It: Coverage did not appear to contain significant partisan differences. This summary was developed with the help of AllSides' AI technology.

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