The Federal Trade Commission filed a lawsuit against Uber on Monday, claiming that the ride sales and delivery giant had billed customers for Uber One’s subscription services without consent. The lawsuit also alleges that Uber failed to provide the promised savings with its subscription service, making it unfairly difficult for users to cancel despite the promise of “cancellation.”
Uber denied the fraud and accused the FTC of rushing the investigation process of claiming it based on an “invalid allegation.”
The lawsuit comes after the FTC pushed the company with subscription services and facilitated cancellations under former director Lina Khan. In October 2024, the agency finalized the “Click to Cancel” rule, and the company requested that cancel the subscription be easily cancelled in one. Despite facing several challenges by industry groups, the rules are expected to come into effect on May 14th.
“Americans are tired of signing up for unnecessary subscriptions that they think are impossible to cancel,” FTC Chairman Andrew Ferguson said in a statement. “The Trump Vance FTC is fighting back on behalf of the Americans.”
FTC’s complaints following the investigation launched last year claim Uber customers are wrongly promising to save $25 a month.
“Even if that’s true, Uber doesn’t take into account the cost of subscriptions ($9.99 per month) when calculating these savings,” reads a statement from the FTC. “The company also obscures important information about subscriptions (for example, by using small grey text that consumers can easily overlook).
The complaint accuses Uber of automatically charging consumers who signed up for free trial prior to the billing date. It also claims that Uber is “very difficult” for customers to cancel, and that users could be forced to “navigate up to 23 screens and cancel as many as 32 actions.” These actions come in the form of explaining why they want to cancel, urging Uber to deal with it and suspend membership, and presenting that if that fails, they will stay.
“Some users have to contact customer support to cancel, but some are told they are not given a way to contact them. Others claim that Uber has requested cancellation and after waiting for a reply from customer support, they have filed a separate billing cycle,” reads the FTC statement.
Uber has revealed that customers who previously wanted to cancel within 48 hours of signing up must contact customer support to cancel. The company says it is not. TechCrunch is reaching out to help Uber update its policies so that those customers can cancel within the app.
The plaintiffs are pushing the court to prohibit Uber from continuing its deceptive practices and to prohibit them from enforcing financial relief on the company.
“We are disappointed that the FTC has chosen to move this action forward, but we are confident that the court will agree to what we already know. Uber’s sign-up and cancellation process is clear and simple, and follows the letter and spirit of the law,” an Uber spokesman said in a statement. “Uber will not sign up or charge consumers without their consent. Cancellations can be made on the app anytime, and most people can take them within 20 seconds.”
Tim Muris, former FTC chairperson who represented Uber during the time of the case’s investigation, accused the FTC of not conducting a full investigation, based on complaints about “misconceptions of both factual and legal.”
“The unconventional nature of the rushing investigation process ahead of this enforcement action was exacerbated by the addition of new and unvetted allegations at the last moment,” said Christine Wilson, Uber’s current external counsel.
Uber’s member base reached 30 million in 34 countries in 2024, with the company saying it’s an approximately 60% increase from the previous year. A year ago, Uber CEO Dara Khosrowshahi estimated that in 2024 Uber One membership fees would be “over $1 billion.”