March 12, 2019: Internet Services Company Settles $1.2 Million Automatic Subscription Renewals Lawsuit

Los Angeles County District Attorney Jackie Lacey announced today that j2 Global, Inc. has agreed to pay $1.2 million and change its sales practices to settle a civil lawsuit alleging the internet services company automatically renewed subscriptions in violation of state law. Prosecutors with the District Attorney’s Office and other members of the California Auto Renewal Task Force (CART) found that the Hollywood-based firm did not properly disclose to its customers that their fax service subscriptions would be automatically renewed after a trial period. Under California law, online businesses must clearly and conspicuously disclose all automatic renewal charges and terms and get affirmative consent of those recurring charges from the consumer.

Los Angeles County Superior Court Judge Daniel S. Murphy approved the settlement in case 19STCV06851 yesterday. Prosecutors alleged that the violations occurred between April 2012 and November 2016 and involved services sold by Los Angeles-based j2 Global that allow people to send, receive and store faxes without a fax machine. Those products include eFax, MyFax and MetroFax.

The $1.2 million includes $585,000 in restitution plus penalties and administrative costs. The company is required to notify by email California consumers who are eligible for restitution.

Under the terms of the settlement, j2 Global also must:

  • Clearly and conspicuously disclose its automatic-renewal terms;
  • Get consumers’ affirmative consent to the terms through a separate checkbox before charging for an automatic renewal or continuous service;
  • Email consumers a confirmation of the transaction after they pay that clearly includes the automatic-renewal terms;
  • Allow consumers to easily cancel the subscriptions, including online, effective upon request;
  • Avoid using misleading online sales information and payment mechanisms; and
  • Allow shoppers to review and make changes to an online order before submitting through express affirmative language.

The requirements apply to all of j2 Global’s products and services.

Deputy District Attorney Duke Chau of the Consumer Protection Division was the lead attorney in the case.

The California Auto Renewal Task Force (CART) investigates businesses to look for violations of California and federal statutes regulating automatic renewal contracts. The other members of CART are the Santa Monica City Attorney’s Office and the Santa Clara County, San Diego County and Santa Cruz County district attorney’s offices.

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