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.

Ellen Choi

Ellen Y. 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…

Ellen Y. 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.

Photo of Ashley Simonsen Ashley Simonsen

Ashley Simonsen is a litigator whose practice focuses on defending complex class actions in state and federal courts across the country, with substantive experience in the three hotbeds of class action litigation: New York, San Francisco, and Los Angeles.

Ashley represents clients in…

Ashley Simonsen is a litigator whose practice focuses on defending complex class actions in state and federal courts across the country, with substantive experience in the three hotbeds of class action litigation: New York, San Francisco, and Los Angeles.

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.

Photo of Nikhil Singhvi Nikhil Singhvi

Nikhil Singhvi has more than 20 years of experience in all aspects of complex litigation and trial practice, government and internal investigations, and compliance counseling, and his practice covers complex advertising, consumer protection, and financial services matters. Specifically, he advises clients on UDAP…

Nikhil Singhvi has more than 20 years of experience in all aspects of complex litigation and trial practice, government and internal investigations, and compliance counseling, and his practice covers complex advertising, consumer protection, and financial services matters. Specifically, he advises clients on UDAP, fintech, fair lending, auto finance, data privacy, lead generation, for-profit education, and related advertising and consumer protection enforcement and regulatory matters.

Nick joins the firm after serving as Assistant Director in the Division of Financial Practices in the Bureau of Consumer Protection at the Federal Trade Commission (FTC), where he coordinated FTC law enforcement and policy initiatives with federal and state partners and supervised investigations, litigations, and resolutions of consumer protection enforcement matters. In this role, Nick worked on groundbreaking cases and investigations, including two auto finance matters that resurrected the agency’s fair lending enforcement program, a small business financing matter that involved a novel invocation of the agency’s civil penalty authority, investigation of potentially discriminatory effects of algorithm-based advertising, and investigations, targeting, and education outreach in the fintech and cryptocurrency space. His matters covered a wide range of statutes and regulations, including the FTC Act, ECOA, TILA, CLA, FCRA, GLB Act, Telemarketing Sales Rule, Credit Practices Rule, Holder Rule, and state law.

Prior to his appointment as Assistant Director at the FTC, Nick served as a Staff Attorney, where he investigated and litigated consumer finance, advertising, debt collection, and lead generation matters. Notably, Nick was the lead attorney in the FTC’s enforcement action against payday lender AMG Services. In FTC v. AMG, he won three summary judgment opinions at different stages of the case, including a precedent-setting decision confirming the FTC’s jurisdiction over tribal businesses in a case of first impression and culminating in the FTC’s largest-ever consumer recovery ($505 million) in a litigated matter.

Photo of John Graubert John Graubert

John Graubert has more than 30 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 co-chair…

John Graubert has more than 30 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 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 Federal Civil Enforcement 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.