FTC sues Uber over its subscription service
Uber One reached 30 million members at the end of 2024, up roughly 50% year over year, the company reported in its most recent earnings report.
Uber deceived customers and put up obstacles for them to cancel its Uber One subscription service, the Federal Trade Commission alleged in a lawsuit filed Monday.
The FTC says the ride-hailing giant misled people on how much they would save using Uber One, a membership program that offers discounts and perks for $9.99 a month, and made it difficult to get out of the program. The company’s stock fell more than 4% on the news.
Uber One reached 30 million members at the end of 2024, up roughly 50% year over year, the company reported in its most recent earnings report. Uber One members spend 3x more than nonmembers, Uber CEO Dara Khosrowshahi said at the Morgan Stanley Technology, Media & Telecom Conference in March.
According to the FTC, Uber signed people up for the subscription service without their consent and required them to take at least 12 steps before they could cancel, and even more steps if they were canceling within 48 hours of their next billing date. Sometimes users were still charged even after they thought they canceled.
“I tried to cancel the subscription before the end of the free trial but the option of Ending Subscription on their app just goes on a loop,” said one customer quoted in the complaint. “After you click on it, it redirects you back to the membership page where it still shows that you are still subscribed.”
Uber denies the FTC’s allegations. Canceling Uber One takes “20 seconds or less,” an Uber spokesperson said in a statement. It is true that in the past, customers canceling within 48 hours of their next billing period had to contact customer support to cancel, but that is no longer the case and those who needed refunds got them, the company said.
Uber’s legal team consists of two former FTC commissioners: Tim Muris, former FTC Chair under President George W. Bush who is now a partner at Sidley Austin, and Christine Wilson, a former commissioner appointed by President Trump who is now a partner at Freshfields.
The FTC’s lawsuit is the latest indication that the tech sector might not be getting preferential treatment from the Trump administration, despite its shift to the right. Antitrust and consumer protection, the center of the FTC’s mandate, has been one force pushing tech companies away from Democrats.
Khosrowshahi, for one, celebrated the Trump administration’s “diversity of voices” in January at the World Economic Forum annual conference in Switzerland. He was also one of many CEOs who gave to Trump’s inaugural fund, donating $1 million.
Still, his firm found itself in the crosshairs of the FTC. The agency has also not let go its antitrust lawsuits seeking to break up Google and Meta.
