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Ninth Circuit Upholds Dismissal of Autorenewal Lawsuit

It found disclosure, consent and acknowledgment sufficient measures

In January, the Ninth Circuit agreed with a California district court's finding that a software company's autorenewal practices did not violate California's autorenewal law. The decision reflects a win for companies offering automatic renewal services despite the onslaught of lawsuits and challenges by the Federal Trade Commission (FTC) and Consumer Financial Protection Bureau (CFPB) on negative option offers due to so-called dark patterns.

In 2021, the plaintiff filed a case against TeamViewer, which sells remote-access software that allows control, management, monitoring, and repair of computers and other devices remotely. In the complaint, the plaintiff alleged that he purchased a year-long subscription, which automatically renewed after one year at a higher price.

The district court reviewed TeamViewer's website enrollment funnel and post-purchase acknowledgments and found that the company did not, as a matter of law, violate California's autorenewal law (ARL). First, it found a disclosure on the "checkout summary" sufficient. Directly above the "Continue to Payment" button, the disclosure stated (partially in bold): "Your subscription will automatically renew every 12 months, unless you terminate your contract at least 28 days before the end of the initial term or any renewal term."

Please select this link to read the complete article from Venable LLP.

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