A new class action lawsuit filed in California federal court accuses Adobe of deliberately obscuring subscription terms, locking customers into year-long contracts, and imposing steep Early Termination Fees (ETFs). Plaintiffs argue Adobe designed its enrollment flow to highlight low monthly pricing while concealing annual commitments and punitive cancellation fees—tactics that the FTC also challenged in its 2024 complaint against Adobe.

Adobe Faces Class Action Over Subscription Practices

Plaintiffs Stephanie Wohlfiel and Vianca Marquez have brought the case against Adobe Inc. in the U.S. District Court for the Northern District of California. The complaint alleges that Adobe misled subscribers about the nature of its “Annual, Billed Monthly” (ABM) plan, portraying it as a flexible monthly option while in reality locking consumers into a one-year contract.

The suit highlights that Adobe failed to clearly disclose the existence and size of its Early Termination Fee, which charges 50% of the remaining annual obligation if a customer cancels early. Internal Adobe communications cited in the complaint describe the ETF as “a bit like heroin for Adobe” and acknowledge that revealing it more clearly would cause a “big business hit.”

The lawsuit goes beyond standard auto-renewal allegations by creating three proposed classes:

• Subscribers who paid ETFs

• Subscribers who paid for the full year of the ABM plan

• Subscribers who attempted to cancel but abandoned the process after learning about fees

These classes aim to capture not only customers who incurred direct charges, but also those deterred from cancelling.

The complaint also points to burdensome cancellation flows, allegations of misleading trial offers, and practices that led some customers to continue being billed even after completing the cancellation process. Plaintiffs cite Adobe’s refusal to alter its practices despite ongoing complaints and the FTC’s 2024 enforcement action against the company.

What’s Next?

The class action is likely to unfold in parallel with the FTC’s case against Adobe, which is already moving forward under the Restore Online Shoppers’ Confidence Act. Whether the two actions remain separate or influence one another, Adobe now faces simultaneous regulatory and private legal challenges targeting the same subscription practices. For subscription businesses, this signals an era where enforcement and litigation may converge, raising both compliance costs and reputational risks.

INSIDER TAKE

This lawsuit marks a significant escalation in the scrutiny of subscription practices. While past cases have typically centered on lack of disclosure or difficult cancellations, Wohlfiel v. Adobe directly targets the financial penalty mechanism itself—the Early Termination Fee—as a deceptive and unlawful business practice.

Three aspects stand out for subscription executives:

1. Internal intent matters. The inclusion of executive language comparing ETFs to “heroin” could prove highly damaging, shifting the case from sloppy disclosures to deliberate strategy.

2. Class definition is broader. By creating subclasses for those deterred from cancelling, plaintiffs are expanding liability beyond direct charges, signaling higher exposure for subscription companies using similar tactics.

3. Regulatory alignment. With the FTC already pursuing Adobe under ROSCA, private actions like this add to the pressure and increase the likelihood of costly settlements or structural changes.

For subscription leaders, the takeaway is clear: fees, penalties, and cancellation hurdles are no longer just a consumer-relations issue—they are a growing legal risk. Transparency in plan terms and straightforward cancellation processes are becoming table stakes for compliance.