October 21, 2022

CFPB Sues Online Event Registration Company Alleging Manipulative Sales Tactics

Lori Kalani, Bernard Nash

Cozen O'Connor

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Cozen O'Connor

The CFPB sued Active Network, LLC alleging that the online event registration company violated the Consumer Financial Protection Act of 2010 (CFPA) and the Electronic Fund Transfer Act (EFTA) when it used so-called “dark pattern” tactics to dupe consumers into joining Active’s discount club and increased the club’s yearly fee without timely notifying members.
According to the complaint, Active—which provides third-party payment and registration services to consumers signing up to participate in fundraising races and other nonprofit events—intentionally used manipulative tactics in page design and language to trick users who believed they were registering for an event into enrolling in its discount club, consisting of a 30-day trial which converted to an annual $89.95 membership unless the consumer affirmatively opted out. The CFPB also alleges that when the then-annual membership fee of $79.95 was increased to $89.95, Active allegedly failed to provide consumers written notice ten days in advance, as required by the EFTA.
The complaint seeks a permanent injunction barring future violations of the CFPA and the EFTA, and any other relief the Court deems appropriate for consumer redress, including rescission, refunds and disgorgement, monetary penalties, and costs.

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