Uber sued in U.S. for non-consensual signups and stringent services

The United States Federal Trade Commission (FTC) has sued ride-hailing and delivery company Uber Technologies for allegedly signing up some Uber One subscribers without their consent and making confusing claims about its services. Uber’s services currently cost $9.99 per month and offer discounts on its ride-hailing and food-delivery apps.

The lawsuit filed by the FTC explained that Uber falsely claimed that users would save up to $25 a month through the service and deceived them about how easy it was to cancel. It also failed to deliver the promised savings and made it difficult for users to cancel the service despite its “cancel anytime” promises. 

“When customers try to cancel, Uber makes it extremely difficult. Users can be forced to navigate as many as 23 screens and take as many as 32 actions to cancel.”

With Trump’s administration, the agency is confident in a fight for consumer rights and Americans at large.

“Americans are tired of getting signed up for unwanted subscriptions that seem impossible to cancel. The Trump-Vance FTC is fighting back on behalf of the American people. Today, we’re alleging that Uber not only deceived consumers about their subscriptions, but also made it unreasonably difficult for customers to cancel.” FTC Chairman Andrew Ferguson said.

According to its complaint, the commission asserted that the ride-hailing company used deceptive billing and cancellation practices. It was again accused of obscuring material information about the subscription by using small, greyed-out text that consumers can easily miss. The FTC explained that many consumers complained that they were enrolled without consent and charged despite not even having an account with the company.

“After sign-up, it charges consumers before their billing date. For example, some consumers who signed up for a free trial say they were automatically charged for the service before the free trial ended even though Uber promises customers the ability to cancel at no charge during the trial period,” the FTC added.

With all these allegations, the commission noted that the company’s deceptive billing and cancellation practices violate the FTC Act and the Restore Online Shoppers’ Confidence Act (ROSCA), which requires online retailers to disclose their terms of service to customers.

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In response, Uber denied the allegations, stressing that the company does not sign up or charge customers without their consent. It noted that its Uber One product operates under a transparent process backed by clear and well-explained terms and conditions.

“We are disappointed that the FTC chose to move forward with this action, but are confident that the courts will agree with what we already know: Uber One’s sign-up and cancellation processes are clear, simple, and follow the letter and spirit of the law,” the company’s spokesperson Noah Edwardsen said.

Uber vs FTC: A recount of other cases 

In the past, the FTC had locked horns with Uber in workers’ protection and consumer rights cases.

In 2017, the FTC filed a complaint against Uber with claims that the company exaggerated the yearly and hourly income drivers could make in certain cities and misled prospective drivers about the terms of its vehicle financing options in order to attract them.

The company claimed on its website that UberX drivers’ annual median income was more than $90,000 in New York and over $74,000 in San Francisco. Meanwhile, the FTC argued that drivers’ annual median income was $61,000 in New York and $53,000 in San Francisco, where less than 10 per cent of all drivers in those cities earned the yearly income it claimed.

A year later, the ride-hailing company agreed to pay $20 million to settle the FTC’s claims it exaggerated prospective earnings in seeking to recruit drivers. A court order also bars Uber from making false, misleading, or ungrounded representations about drivers’ income.

In a data breach, security, and criminal case in 2022, the company was involved in a settlement after admitting that its employees had failed to notify the FTC about a 2016 data breach that affected 57 million passengers and drivers.