Netflix is on the ropes as folks fight back against the pending $2 a month price increase. A Florida subscriber filed a lawsuit last week against Netflix, saying that the streaming video provider has failed to honor its contract to grandfather him in at the $7.99 a month rate. Does the subscriber have a legitimate beef, or is he simply looking to cash in on Netflix’s success? The U.S. District Court for the Northern District of California, San Jose Division, will decide.

Here’s what happened. On June 29, George Keritsis of Florida filed a class-action complaint against Netflix in the U.S. District for the Northern District of California, San Jose Division, alleging a breach of contract, reports Northern California Record. The complaint says that Keritsis subscribed to Netflix in 2011 when the monthly subscription fee was $7.99. The plaintiff subscribed because, he said, that Netflix guaranteed the $7.99 monthly rate for as long as he had a Netflix account. Keritsis says that an ad announced the rate guarantee and he confirmed it verbally with customer service representatives at Netflix.

Fast forward to June 2016 when Keritsis received an email notice that his price would increase to $9.99 beginning in July, and he decided to fight back. Represented by attorney Robert C. Schubert and Noah M. Schubert of Schubert, Jonckheer & Kolbe LLP in San Francisco and Thomas G. Shapiro, Haber & Urmy LLP in Boston, Keritsis seeks a jury trial and to permanently enjoin Netflix, compensatory damages, interest, legal fees and any other relief the court deems appropriate.

An estimated 17 to 22 million subscribers could be affected by the pending rate increase. Keritsis is seeking class-action status for the lawsuit.

The Hollywood Reporter quotes the complaint in a June 30 article about the lawsuit:

“For a period of time, Netflix solicited persons to subscribe to Netflix’s streaming service by guaranteeing that Netflix would not increase monthly subscription prices as long as the subscribers maintained the subscription service continuously,” states the complaint. “Netflix has broken its contract with these subscribers by unilaterally raising monthly subscription prices.”

To date, Netflix has not responded publicly to the complaint.

Insider Take:

As Netflix subscribers who are also subject to the price increase, we can see Keritsis’ frustration at having to pay more, but a class-action lawsuit seems a bit extreme over a $2 per month price increase, or $24 a year. It seems unreasonable to assume a company will never raise its prices, particularly for emerging technologies and services.

Like any of us not willing to pay the higher price, Keritsis has the option to cancel his subscription or to choose another streaming video provider. Except for the price difference, we fail to see how Keritsis was actually harmed by this change. Nonetheless, Netflix will have to respond to the allegations, and the outcome – whether achieved via litigation or settled out of court – is likely to set a legal precedent in similar cases.

This unfortunate situation will serve as a cautionary tale to other subscription services to be very clear about their pricing, including terms, conditions and price guarantees. Transparency and avoiding ambiguity and conflicting promotions are critical.