A recent class action filed in federal court against YouTube is the latest in a growing list of class actions against companies regarding their automatic renewal practices.

The suit alleges that YouTube and its parent company Google (together, “YouTube”) failed to provide the requisite disclosures and authorizations in connection with their subscription services, including YouTube TV, YouTube Music, and YouTube Premium, as required by Oregon’s Automatic Renewal Law (“ARL”) and in violation of Oregon’s Unlawful Trade Practices Act (“UTPA”).  See Walkingeagle, et al. v. Google LLC, et al., No. 3:22-cv-763 (D. Or.).  According to the complaint, YouTube enjoyed rapid growth in their user-base by employing “dark patterns” in their user interfaces to “trick” users into doing things they might not otherwise do, including signing up for recurring services (and bills).

The plaintiffs claim that YouTube violated the central requirements of Oregon’s ARL—namely: (1) presenting the automatic renewal terms in “a clear and conspicuous manner” and “in visual proximity” to the request for consent to the offer before fulfilling the subscription; (2) obtaining the plaintiffs’ affirmative consent to the automatic renewal offer terms before charging them; and (3) providing an acknowledgment with the offer terms, cancellation policy, and information on how to cancel the subscription.  Specifically, the plaintiffs allege that a reasonable consumer would find the automatic renewal terms on the checkout page unclear as to whether formal cancellation is required to stop the recurring payments and whether the customer is agreeing to recurring payments that will continue indefinitely.  Moreover, the plaintiffs contend that the price terms appear far away from the “final checkout” button and that the checkout page lacks explanations as to how and when to cancel to avoid being automatically renewed or to receive a refund.

The plaintiffs seek to represent a class of individuals in Oregon who incurred fees in connection with YouTube’s subscription offerings within the applicable statute of limitations period, and seek compensatory, statutory, and punitive damages.

Auto-renewal law is a fast-growing practice area that has recently resulted in multimillion-dollar settlements.  Similar suits are expected to follow as more states enact new auto-renewal laws or beef up old ones.  Notably, new amendments to California’s ARL—which is already the most robust in the country—that impose additional renewal notice and online cancellation requirements are set to take effect starting July 1, 2022.

This issue is not limited to class action litigation.  Our FTC experts, who continue to closely monitor developments in the auto-renewal area, see this as a growing area of interest for state and federal regulators as well.

Tags: Litigation, technology
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Photo of Ellen Choi Ellen Choi

Ellen Choi is a member of the firm’s Litigation and Investigations Practice Group. She represents clients in complex commercial disputes involving a range of issues such as business torts, consumer protection, and insurance recovery. Ellen also has experience in a range of internal…

Ellen Choi is a member of the firm’s Litigation and Investigations Practice Group. She represents clients in complex commercial disputes involving a range of issues such as business torts, consumer protection, and insurance recovery. Ellen also has experience in a range of internal investigations, including workplace culture investigations. Ellen maintains an active pro bono practice.

Ellen is fluent in Korean and has experience advising Korean companies in litigation and investigation matters.

Prior to joining Covington, Ellen clerked for Judge Philip S. Gutierrez, U.S. District Court, Central District of California. Ellen was a management consultant in the pharmaceutical and biotech space before practicing law.

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Photo of Ashley Simonsen Ashley Simonsen

Ashley Simonsen is a litigator whose practice focuses on defending complex class actions and mass torts in state and federal courts across the country.

Ashley represents clients in the technology, consumer brands, financial services, and sports industries through all stages of litigation, including trial…

Ashley Simonsen is a litigator whose practice focuses on defending complex class actions and mass torts in state and federal courts across the country.

Ashley represents clients in the technology, consumer brands, financial services, and sports industries through all stages of litigation, including trial, with a strong track record of success on early dispositive motions. Her practice encompasses advertising, antitrust, product defect, and consumer protection matters. Ashley regularly advises companies on arbitration clauses in consumer agreements and related issues, including mass arbitration risks and issues arising under McGill v. Citibank, N.A. And she is one of the nation’s leading experts on “true lender” issues and the related “valid when made” doctrine.

Ashley has been recognized three times by Law360 as an “MVP” (in Class Actions, Technology, and Banking) and as a “Rising Star” (in Banking). Her successful representation of Meta earned her a 2021 “Top Verdict” recognition from the Daily Journal. She has also been included in the Daily Journal’s list of the “Top 100 Lawyers” and “Top Women Lawyers” in California, named a “Lawyer on the Fast Track” and “Women Leader in Tech Law” by The Recorder, and recognized twice as a Leader of Influence: Litigators & Trial Lawyers by the Los Angeles Business Journal. Before practicing law, Ashley was an associate at Lehman Brothers in New York where she advised banks on balance sheet management and interest rate hedging strategies.

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Photo of John Graubert John Graubert

John Graubert has more than 40 years of experience in a wide range of complex antitrust and consumer law matters. John came to the firm after serving for ten years as Principal Deputy General Counsel of the Federal Trade Commission. John is the former co-chair…

John Graubert has more than 40 years of experience in a wide range of complex antitrust and consumer law matters. John came to the firm after serving for ten years as Principal Deputy General Counsel of the Federal Trade Commission. John is the former co-chair of the firm’s Advertising and Consumer Protection practice group, an Adjunct Professor at the Georgetown University Law Center, and a vice-chair of the Global Private Litigation Committee of the ABA Antitrust Section.

From 1998-2008, John served as Principal Deputy General Counsel (including several stints as Acting General Counsel) at the Federal Trade Commission. In that position John managed all litigation, legal counsel, policy studies, and administrative functions within the Office of General Counsel. He also advised the Commission and agency staff on antitrust and consumer protection matters and administrative law. He was involved in dozens of litigated matters for the Commission, including FTC v. Swedish Match, et al. (D.D.C. 2000) and FTC v. Schering-Plough, et al. (11th Cir. 2005), and received the A. Leon Higginbotham Award and the Award for Distinguished Service.

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