Lingerie Startup Settles FTC Suit Over Deceptive Subscriptions

Adore Me is one of many retail startups accused of tricking customers into hard-to-cancel memberships.

lacy lingerie womens underwear on white background — Photographer: Getty Images

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By Kim Bhasin and Rebecca Greenfield

November 21, 2017 at 7:06 PM UTC

This article is for subscribers only.

Lingerie retailer AdoreMe Inc. agreed to pay $1.38 million to settle a U.S. Federal Trade Commission lawsuit over claims that it deceived shoppers with its billing tactics. At issue was a subscription business model, popular among online retail startups, that featured a hard-to-cancel membership with a monthly fee.

The FTC sued the New York-based underwear retailer on Monday, alleging the company violated the Restore Online Shoppers Confidence Act by making it difficult for shoppers to cancel memberships and halt credit card charges. The FTC also claimed Adore Me misrepresented its store credit policy. Although Adore Me promised that customers could use store credits at any time, the complaint found that the company revoked unused credits after customers cancelled their memberships. The settlement will be used to pay customer refunds.