Adore Me will pay $2.35 million in a multi-state settlement after the undergarments-maker was accused of engaging in a deceptive marketing scheme. At the heart of the recently-announced settlement are charges that Adore Me offered customers discounted pricing if they enrolled in its VIP Membership Program. Once they enrolled in the company’s program, consumers were charged as much as $39.95 a month, unless they made a purchase from Adore Me or logged into their Adore Me accounts to “skip” the charge before the sixth day of each month. The monthly charges accrued in subscribers’ accounts as store credits, which were supposed to be used on future purchases.
The problem: According to the Attorneys General from 31 states (Alabama, Arkansas, Connecticut, DC, Florida, Georgia, Idaho, Illinois, Indiana, Kansas, Kentucky, Louisiana, Massachusetts, Michigan, Minnesota, Mississippi, Nebraska, Nevada, New Jersey, New Mexico, North Carolina, North Dakota, Ohio, Oklahoma, Oregon, Pennsylvania, Rhode Island, Tennessee, Texas, Vermont, Washington, and Wisconsin) is that Adore Me made enrollment in the VIP Membership Program, the default selection when consumers made purchases, and did not “clearly and conspicuously” disclose they would be charged $39.95 a month unless they either made additional purchases or took action to “skip” the charge.
Also at issue was how difficult Adore Me allegedly made it for consumers to cancel their memberships, forcing them to “forfeit store credits when they canceled, and using a fake ‘countdown clock’ to mislead consumers into believing that discounts would expire when the clock struck zero,” per Reuters.
In accordance with the settlement, which resolves “alleged violations of [the aforementioned sates’] consumer protection laws” and was negotiated by Washington, D.C., Pennsylvania and Texas’ AGs, Adore Me is now “required to notify all customers with active VIP Memberships that they can obtain a refund of any unused store credits.” In addition, the company “has agreed to make certain changes to its business practices and is prohibited from engaging in any misconduct.” In particular, Adore Me will make enrollment in the VIP subscription an “opt-in” instead of an “opt-out,” and will make improvements to its disclosures about its subscriptions/terms.