Thrive Market, a popular online retailer known for its natural and organic offerings, has been hit with a hefty $1.55 million settlement for duping consumers with sneaky subscription renewals, Los Angeles County District Attorney George Gascón revealed yesterday. Under the bright California sun, justice seemed to have been served as the DA's office cracked down on the company's breach of the state's Automatic Renewal Law and False Advertisement Law.
According to a statement obtained by the Los Angeles County District Attorney's office, Gascón called out Thrive Market's approach as a "flagrant violation of consumer rights and ethical business practices," adding that, "Automatic renewal without explicit consent undermines the fundamental principle of transparency and fairness in consumer transactions.” The case, probed by the California Automatic Renewal Task Force, which was formed by LADA, has put other subscription-based services on notice.
As part of the settlement, Thrive Market must ink in some changes to their business practices. These include making the terms of automatic renewal crystal clear, nailing down consumers' consent through a checkbox before billing, flinging confirmation emails post-purchase outlining subscription details, and ensuring customers can wriggle out of subscriptions online without a hitch. Add to that, no more misleading statements about what they're selling or their deals.
While the company buckled under pressure and agreed to the settlement on April 30, they did not admit to any wrongdoing. They have, however, shown some corporate spirit, working with CART to make sure their subscription model is up to legal snuff, as stated by the Los Angeles County District Attorney's office. The cooperative stance has perhaps saved them from tougher sanctions, but the lingering question remains: how many consumers were left in the dark before the law intervened?
Thrive Market may have escaped with a slap on the wrist this time, but the California Automatic Renewal Task Force remains on high alert. It's a wake-up call to all online markets: when it comes to consumer rights in sunny California, transparency isn't just a nice-to-have, it's the law.
