The U.S. Federal Trade Commission slapped Uber with a lawsuit on Monday, alleging that the ride-hailing and delivery company deceptively enrolled consumers in Uber One, its paid subscription service, without proper consent. In addition to enrolling consumers without their knowledge, the FTC also claims that Uber falsely advertised that users would save roughly $27 a month and that the subscription was hassle-free and easy to cancel.
The Uber One service costs $9.99 a month and provides users with discounts on the fees associated with its ride-hailing and food-delivery services. While it doesn’t eliminate all service fees, it offers discounts, credits, and member-only promotions.
The FTC alleges that Uber violated both the FTC Act and the Restore Online Shoppers’ Confidence Act (ROSCA) by failing to disclose its terms of service, failing to obtain customer’s consent before charging them, and not providing a simple way to cancel their subscription.
“Americans are getting tired of getting signed up for unwanted subscriptions that seem impossible to cancel,” FTC Chairman Andrew Ferguson said in an official statement.
In an interview last month with CNBC, Ferguson emphasized the agency’s dedication to protecting consumers from deceptive digital practices. He said the federal agency will continue to keep a close eye on Big Tech companies that attempt to violate consumer protection laws.
This isn’t the first time that Uber has come under fire from the FTC. In 2017, Uber settled with the agency over deceptive privacy and security claims. A year later, the company paid $20 million to resolve allegations that it exaggerated driver earnings during recruitment. In 2022, the company avoided criminal charges in a data breach settlement, admitting that it failed to notify the FTC about a 2016 security breach that affected 57 million users.
* Editor’s Note: NADA and the FTC are encouraging dealers to register for this webinar to learn more about the warning letters and the agency’s perspective on dealer advertising.
