* Rachel Gold is a law clerk in the Corporate/Securities Law practice group.
Panera Bread Company (“Panera”) is facing a class action lawsuit that alleges its Unlimited Sip Club (“Club”) is in fact not so unlimited. According to Panera’s own promotional materials, the Club is a refill program where members pay $10.99 per month for access to lemonade, soda, coffee, and tea drinks of “any size” at “any time.”
The client alert addresses how New York has now joined other states with some of the most burdensome automatic renewal laws, enacting a sweeping law that regulates automatic renewal disclosures and cancellation procedures.
Online children’s education company Age of Learning, Inc., also doing business as ABCmouse, has agreed to pay $10 million to settle the FTC’s charges that it made it difficult and confusing for subscribers to cancel their memberships. The settlement highlights the importance of a compliant subscription enrollment pathway, including readily-accessible cancellation processes. It also highlights a growing focus by regulators and others on “dark patterns” online marketing techniques.
Visa has announced that to enable greater transparency, choice, and control for customers, effective April 18, 2020, it is updating its Policy for Subscription Merchants Offering Free Trials or Introductory Promotions. In an effort to help merchants comply with these new policies, Visa has created a Trial Subscription Quick Reference Card and a Reminder Notice with answers to frequently asked questions. While not binding as a regulatory matter, compliance with Visa’s policies is important under companies’ merchant processing agreements.
Andrew Lustigman published an article in Leading Internet Case Law entitled “eHarmony Settlement Illustrates Changes Required in E-Commerce Subscriptions Programs.”
Recently proposed legislation in New York and in Maine, if passed, would impact businesses that provide subscription arrangements. These laws reflect a growing legislative trend to regulate goods and services billed on an auto-renewal basis.