Ohio joins multi-state lawsuit against Uber subscription service
Ohio has joined a Federal Trade Commission lawsuit against Uber, alleging the company engaged in deceptive practices as part of its Uber One subscription service. Nineteen other states, the District of Columbia and California’s Alameda County have signed on to the lawsuit as well.
“Uber took consumers for a ride – and it wasn’t what they signed up for,” Ohio Attorney General Dave Yost said in a press release. “A free trial shouldn’t lead to a surprise bill, and canceling shouldn’t become an exercise in frustration.”
Meanwhile, the ride hailing company defends the subscription service, which trades perks like discounts and ride credits for a monthly fee.
“Millions of Americans choose Uber One because it delivers real, measurable value: substantial savings on rides and deliveries, priority service, and exclusive promotions,” the company said in a statement.
“The FTC, and the states that have decided to join this misguided lawsuit, are wrong, and we will vigorously defend these claims in court,” it added.
The case
The Federal Trade Commission and attorneys general contend Uber’s subscription service makes bogus claims about purported savings and makes it very difficult for consumers to cancel.
In its promotional materials, Uber claims customers save on average $25 a month with the subscriptions. The complaint rejects that out of hand.
“In fact, these claims are false,” it states. “Many consumers do not actually save $25 a month by using Uber One.”
The FTC and attorneys general cite internal documents from Uber in 2023 that detail actual savings among subscribers. But those figures are redacted in the court filing. Notably, they add Uber’s savings claim only works if you don’t factor in the cost of the subscription.
Much of the government’s case hinges on violations of the Restore Online Shoppers’ Confidence Act, a consumer protection measure passed by Congress in 2010. Part of that law generally prohibits the sale of goods or services through “negative option marketing” unless there are specific safeguards.
“A negative option is an offer in which the seller treats a consumer’s silence — their
failure to reject an offer or cancel an agreement — as consent to be charged for goods or services,” the complaint explains.
One of the required protections is a simple cancellation process. But the government claims, “Uber utilizes various tactics that prevent or make it hard for consumers to cancel, especially when they attempt to do so within 48 hours of their billing date, often snaring consumers into additional months or even years of a service they no longer want or need.”
The filing details a seven screen, 12 action process customers must navigate to cancel. But in the final 48 hours of a billing cycle, that process grows 32 actions on 23 screens and involves direct contact with customer service. In those circumstances, the app explained their next payment may already be in process.
“In fact, Uber always charged consumers before the supposed billing date and never processed cancellations concluded via the in-app cancellation flow in the final 48-hour window,” the complaint alleges.
The government notes as of September of 2024, Uber had enrolled more than 28.7 million users in the program, and that those subscription fees generated close to a billion dollars in revenue over two years.
Uber’s response
In its statement, Uber pushed back strongly on the government’s characterization of its subscription service.
“If this lawsuit were to succeed, it would upend how virtually every modern subscription service operates,” the company said. “Uber One’s sign-up and cancellation processes are clear, simple, and follow the letter and spirit of the law. Uber does not sign up or charge consumers without their consent, and cancellations can be done anytime in-app and take most people 20 seconds or less”
The company also said it has since eliminated the alternative cancellation process in the final 48 hours of a billing cycle.
“This has not been the case for more than a year,” the company stated, “and we have refunded customers who had reached out to Uber Support to cancel within 48 hours of their next billing period and did not receive benefits greater than the membership fee charged.”
Follow Ohio Capital Journal Reporter Nick Evans on X or on Bluesky.
Ohio Capital Journal is part of States Newsroom, a nonprofit news network supported by grants and a coalition of donors as a 501c(3) public charity. Ohio Capital Journal maintains editorial independence. Contact Editor David Dewitt for questions: info@ohiocapitaljournal.com.