FTC Takes Legal Action Against Uber Over Alleged Subscription Misconduct

The US FTC has sued Uber, alleging the ride-hailing service engaged in deceptive billing for its Uber One subscription by charging customers without consent and complicating cancellation processes. Uber denies these claims, asserting that customers can now cancel their subscriptions easily.

The US Federal Trade Commission (FTC) has initiated a lawsuit against Uber, claiming that the prominent ride-hailing and delivery service engaged in misleading billing practices related to its subscription model. The regulatory body accuses Uber of enrolling customers into its Uber One service without obtaining proper consent, making it increasingly difficult for users to terminate their subscriptions.

FTC Chairman Andrew Ferguson, who was appointed by former President Donald Trump, stated, "The Trump-Vance FTC is taking a stand for the rights of the American consumer," emphasizing the organization's role in protecting public interest. An Uber spokesperson expressed disappointment regarding the lawsuit, denying any wrongdoing.

Uber One, launched in 2021, is a subscription service that offers users benefits, including fee-free deliveries and discounts on rides. Customers can choose between a monthly fee of $9.99 or an annual payment of $96.

In its complaint, the FTC asserted that consumers faced frustratingly complex procedures when attempting to cancel their subscriptions, citing that users must navigate as many as 23 screens and complete up to 32 actions to cancel. In response, Uber's spokesman Ryan Thornton countered that users can now complete cancellations easily within an app in around 20 seconds.

Previously, Uber mandated that customers contact support within 48 hours of their next billing cycle to cancel; however, the company now claims that cancellations can be made at any time.

The FTC's allegations also include reports from consumers asserting they were enrolled in the Uber One service without their explicit consent, including one individual claiming they were charged without even having an Uber account. In its defense, Uber rebuffs these accusations, reiterating its policy of not signing up or charging customers without their approval.

This lawsuit against Uber is noteworthy as it marks the FTC's first major legal action against a tech giant since Donald Trump's administration entered its second term. The agency's ongoing case against Meta, the social media entity formerly known as Facebook, is currently heading into the second week of its trial. The FTC has accused Meta of maintaining a monopoly in social media through its acquisitions of Instagram in 2012 and WhatsApp in 2014, claims that Meta has countered as being misguided, citing that the acquisitions were previously approved by the FTC.