No Need to “Renew” Their Angst: Auto-Renewal Plaintiffs Remain Vigilant

San Diego, CAPromoters of automatic renewals tout the convenience of ensuring continued service for busy consumers who otherwise might forget to renew a valued service on their own. Critics, however, counter that service providers are taking advantage of technology and online commerce to milk additional revenues from unsuspecting consumers. Little wonder many turn to an Auto-Renewal lawsuit.

That’s what one California resident has done after filing a proposed Automatic Renewal Program class action in November of last year. The unnamed plaintiff, who filed as “John Doe,” is litigating against NAC Marketing Company LLC and accuses the defendant of extending offers of continuous service or undertaking automatic renewals without obtaining explicit consent according to California law.

The state of California is one of a handful of states having put aggressive and specific laws on the books requiring marketers and service providers to ensure, beyond all reasonable doubt, that a consumer is aware and fully understands that to which he or she is agreeing.

NAC is identified as an online provider of subscriptions for service, marketing products purported to increase an individual’s libido and performance, promote muscle, increase energy and boost what is described as “free testosterone.”

The plaintiff, who filed his Auto-Renewal Subscription Program lawsuit in California November 9, accuses NAC of undertaking automatic renewal of a membership for service without affirmative consent.

According to court dockets, NAC moved to have the Automatic Renewal Program lawsuit dismissed - a motion that was eventually granted, with the barn left open for the plaintiff to refile. The plaintiff did so, submitting an amended complaint on January 21.

The automatic renewal phenomenon was born from the advent of the free trial offer, with a consumer required to contact the provider and subscribe in order to keep the service going. Service providers, some suggest, may have found that busy consumers either missed the renewal deadline for a service they valued, or were not translating into sufficient numbers of conversions from trial offers to clients without a “push.” That nudge became the automatic renewal based on information gleaned from enrollment in a trial offer that suddenly puts marketers and service providers in the drivers’ seat.

Consumers, as a result, have long complained that auto-renewal terms were not fully spelled out in agreements, were buried in fine print or omitted altogether.

The state of California amended the California Business and Professions Code, Section 17600, in 2010. Service providers must disclose the automatic-renewal terms in a clear and conspicuous manner before the agreement is completed, and that the terms must be in visual proximity to the consent for the agreement.

The aforementioned Auto-Renewal lawsuit is Doe v. NAC Marketing Company, LLC et al, Case Number 3:15-cv-02522, in US District Court, Southern District of California. Judge Anthony J. Battaglia presiding.