Adobe has agreed to pay $75 million to settle a lawsuit filed by the United States government that accused the company of making it difficult for customers to cancel subscriptions and hiding cancellation fees.
The lawsuit, originally filed in June 2024 by the US Department of Justice, claimed that Adobe violated federal consumer protection laws through its Creative Cloud subscription plans. According to the complaint, the company failed to clearly explain important terms in its “annual paid monthly” plans and created a cancellation process that was unnecessarily complicated for users.
Officials also alleged that customers who tried to cancel their subscriptions were often surprised by early termination fees. The lawsuit described these fees as being hidden from users until they attempted to cancel their plans. One Adobe executive even reportedly compared the termination fees to “a bit like heroin for Adobe,” highlighting how profitable they were for the company.
As part of the proposed settlement, Adobe will pay $75 million to resolve the case. The company also says it will provide another $75 million worth of free services to customers who were affected by the issue, assuming the court approves the agreement.
Despite agreeing to the settlement, Adobe says it does not admit any wrongdoing. The company stated that it disagrees with the government’s accusations but wants to resolve the matter and move forward. Adobe also said it has already made improvements to make its subscription terms clearer and to simplify the cancellation process for customers.
The announcement comes during a leadership transition at Adobe. CEO Shantanu Narayen recently revealed plans to step down after leading the company for 18 years. During his time as CEO, Adobe shifted from selling software through one-time purchases to a subscription-only model, which now powers its Creative Cloud services.
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The final decision on the settlement will depend on whether the court approves Adobe’s proposal.
