Class Action Lawsuit Targets Hulu Plus Auto-Renewal Policy

UPDATE: The Hulu privacy class action lawsuit was dismissed by a California federal judge on March 31, 2015. The plaintiffs filed an appeal on April 15, 2015.

Hulu LLC was hit with a class action lawsuit accusing the company of violating California law by failing to adequately disclose that customers who upgraded to Hulu Plus would be charged for automatic renewals.

Hulu is a web-based service that allows users to stream videos for free. Hulu generates advertising revenue for this free, on-demand streaming service. The company also offers a Hulu Plus upgrade, which gives users access to a larger library of on-demand television shows and movies for $7.99 per month.

Plaintiff Nathan Kruger filed the class action lawsuit Friday on behalf of himself and all others who, since Dec. 1, 2010, upgraded their free Hulu accounts to Hulu Plus and were subjected to automatic renewals. Kruger alleges Hulu “failed to present the automatic renewal offer terms, or continuous service offer terms, in a clear and conspicuous manner and in visual proximity to the request for consent to the offer before the subscription or purchasing agreement was fulfilled,” in violation of California law.

Kruger claims that he clicked on a “TRY 1 Week Free” button on the Hulu website, which would allow him to experience a week of Hulu Plus without charge. After he clicked the button, he was navigated to a page requesting payment information. According to the class action lawsuit, this page did not contain any information about the automatic renewal offer terms. Once he entered his payment information, Kruger began the one-week free trial of Hulu Plus. At the end of the free trial, Hulu allegedly began charging him each month for a Hulu Plus subscription.

According to the class action lawsuit, Hulu failed to state in clear and conspicuous language that the Hulu Plus subscription would continue until the purchaser cancels, failed to describe the cancellation policy, and failed to inform consumers that the membership would be automatically renewed. Kruger alleges that the disclosures Hulu does make are hidden in a “vague and ambiguous document” available via a small hyperlink at the bottom of the hulu.com webpage. On the other hand, consumers who utilize an application on their cell phones are required to check a box stating that they consent to the Hulu Plus subscription agreement.

Hulu “failed and continues to fail to provide a mechanism during the checkout phase, after the Hulu Plus subscription offer and prior to charging the payment method, of obtaining Plaintiff and Class Members express explicit consent,” the class action lawsuit says.

Because the consumers were not informed that their Hulu Plus subscriptions would be automatically renewed, Kruger argues that the subscriptions should be “deemed to be an unconditional gift” according to California law. The class action lawsuit seeks injunctive relief, restitution and/or other equitable relief, and attorneys’ fees and costs.

Kruger is represented by Julian Hammond and Ari Cherniak of HammondLaw PC.

The Hulu Plus Auto-Renewal Class Action Lawsuit is Kruger, et al. v. Hulu LLC, Case No. BC540053, in the Superior Court of the State of California, County of Los Angeles.