The Setup

How Adobe Built the Trap

Adobe switched from selling software outright to selling subscriptions around 2012. Since then, it has had every financial incentive to lock you in as long as possible and make leaving as painful as possible. The federal complaint documents exactly how that played out.

• Adobe’s subscription revenue nearly doubled in four years. The company earned $7.71 billion in subscription revenue in 2019 and $14.22 billion in 2023, out of $19.41 billion in total annual revenue. Subscriptions are the whole business now.
• Adobe offers three plan types: Monthly (cancel anytime, no fee), Annual Prepaid (pay the full year upfront), and Annual Paid Monthly (APM). The APM plan is the most lucrative for Adobe and the most dangerous for consumers. It is also the one Adobe pre-selects as the default.
• The APM plan carries an Early Termination Fee (ETF) calculated as 50% of all remaining monthly payments left in the one-year contract. If you are six months into a $54.99/month plan and want out, you owe roughly $165 on top of what you already paid.
• Adobe’s enrollment flows deliberately showed the APM plan’s per-month price as the lowest number on screen, making it appear to be the budget-friendly choice. The one-year commitment and the ETF were not shown on the same page in plain language.
• For many consumers, particularly before October 2021, Adobe skipped the plan selection page entirely. Those consumers were enrolled in the APM plan without ever seeing an alternative or any tooltip about cancellation fees.

“Adobe clearly discloses the ETF only when subscribers attempt to cancel, turning the stealth ETF into a powerful retention tool that generates significant revenues by trapping consumers in subscriptions they no longer want.”
— U.S. DOJ Complaint, Paragraph 2

The complaint walks through three specific pages of Adobe’s enrollment “flow” to show exactly where the disclosures should have been and what Adobe put there instead.

• Page 1 (Plan Selection): The ETF is mentioned only as “Fee applies if you cancel after 14 days” in small print, followed by a tooltip icon. Clicking or hovering the icon reveals more text, but even that text does not tell you the fee amount, how it is calculated, or that you are committing to a full year.
• Page 2 (Email Entry): The annual commitment is not mentioned at all on this page.
• Page 3 (Payment Entry): The ETF is mentioned for the first time in a fine-print paragraph beneath the payment entry form. Even here, the text says “avoid a fee” without naming the ETF or stating its amount. The only place the full ETF calculation appears is buried inside a pop-up linked from the words “Subscription and Cancellation Terms,” which Adobe knows most consumers never click.

The Numbers

Adobe’s Subscription Revenue Growth

The financial incentive to trap consumers in long-term plans is visible in Adobe’s own revenue trajectory. The APM plan accounts for the majority of this growth.

The Human Cost

The Non-Financial Ledger

Numbers tell one part of this story. The other part lives in the experiences of people who just wanted to stop paying for software they did not need.

Picture someone who signed up for Adobe’s Creative Cloud during a freelance project that dried up. The economy shifted, the client disappeared, the income stopped. They went to cancel. They clicked what seemed like the right link. They re-entered their password. They filled out a survey explaining why they were leaving. They declined a retention offer. They clicked through a warning screen. And then, suddenly, a number appeared in red. Not the small monthly fee they had been paying. A lump sum. Hundreds of dollars. For leaving.

They had no idea. They had never seen that number during sign-up. The complaint documents this moment as a deliberate design choice. Adobe put the ETF in small print on the way in, invisible and forgettable. Adobe put the ETF in large red text on the way out, impossible to ignore. The revelation is the weapon.

One customer, after months of failed attempts, emailed Adobe’s CEO directly. The complaint includes their words: four phone calls, online requests, an hour being transferred from one representative to another, and then being hung up on. They wrote to the top of the company because there was no other door left to knock on. Adobe’s leadership received that email. They were aware of thousands more like it. They kept the system in place anyway.

Another customer tried three times by phone and chat over several months. Each call ended not with cancellation but with someone offering two free months in exchange for staying. The subscription kept renewing. The charges kept appearing. The customer kept fighting.

A third reported that the online cancellation system simply looped them back to a sign-in screen over and over. They could not move forward. The complaint describes this as a feature, not a bug. Adobe’s own data showed the cancellation flow was optimized to reduce successful exits.

For Teams and Education subscribers, self-cancellation was blocked entirely. Those users could not cancel online at all. They were required to call or chat, which meant they had no choice but to walk through the retention gauntlet.

The people caught in this system were not careless. They were navigating an interface designed by one of the world’s most sophisticated software companies, with the explicit goal of making them stay. When a company with Adobe’s resources builds a process this convoluted, that complexity is a product decision. Every extra screen, every dropped chat, every re-entry of a password already entered, every “save offer” before the cancellation option was delivered, was chosen. The complaint describes a product team that actively added friction between 2019 and 2023, not reduced it. Adobe did not have a broken cancellation system. Adobe had a cancellation system that worked exactly as intended.

Primary Sources

Legal Receipts

The following are direct quotes from the unredacted federal complaint filed by the U.S. Department of Justice. These are verbatim statements from the court record, not interpretations.

“As one Adobe executive admitted, the hidden ETF is ‘a bit like heroin’ for Adobe and ‘there is absolutely no way to kill off ETF or talk about it more obviously [without] taking a big business hit[.]'”
— DOJ Complaint, Paragraph 4

• This quote comes from an Adobe executive’s own internal communication and was included in the federal complaint as evidence of deliberate misconduct, not negligence.
• The phrase “talk about it more obviously” is an admission that Adobe’s leadership understood the ETF was being concealed from consumers and that revealing it clearly would directly reduce Adobe’s income.
• The “heroin” framing describes an addictive revenue mechanism: consumers trapped by a fee they did not know existed, generating income Adobe could not afford to lose.

“Despite knowing about widespread consumer confusion regarding APM terms, Defendants have refused to remedy their unlawful practices because Adobe has profited handsomely from these practices. Indeed, Adobe’s insufficient APM disclosures are a deliberate company strategy that Defendants have contemplated ending but have ultimately decided to continue…”
— DOJ Complaint, Paragraph 58

• This is the federal government stating, as a finding of fact in a legal complaint, that Adobe’s deceptive practices were intentional and strategic, not accidental.
• The phrase “contemplated ending” confirms that Adobe’s leadership evaluated whether to fix the problem. They chose not to, because the revenue from keeping it outweighed the ethical cost of stopping it.

“Sawhney has himself pointed out that many APM plan subscribers are unaware of the ETF and its one-year commitment, but he has continued to help direct and implement Adobe’s unremedied ETF practices to protect the company’s revenues.”
— DOJ Complaint, Paragraph 66

• Senior Vice President Maninder Sawhney, a named defendant, personally identified the consumer harm caused by the ETF. The complaint alleges he continued directing the same practices after making that identification.
• This is the complaint establishing personal liability: Sawhney is sued not because he was unaware of the problem, but because he was aware and chose to perpetuate it.

“I am desperate. I no longer know how to get help. I am writing for the umpteenth time . . . I have made written online requests galore, I have made 4 phone calls to Adobe’s advertised phone numbers. I get no help online and no help by phone. Instead I spend an hour being transferred from one person to another and eventually being hung up on. . . . What does it take to cancel the subscription?”
— Consumer quoted in DOJ Complaint, Paragraph 106(a); this email was sent directly to Adobe CEO Shantanu Narayen

• This complaint reached the CEO of a $19 billion revenue company. It was not an isolated report. The federal complaint documents that Adobe tracked complaints like this from the BBB, state law enforcement, and its own support channels.
• The complaint’s inclusion of this quote establishes that the highest levels of Adobe’s leadership had direct knowledge of individual consumer suffering caused by their cancellation system.

“Adobe has designed and evaluated its cancellation procedures partly with the goal of preventing cancellations and maximizing customer retention.”
— DOJ Complaint, Paragraph 91

“Adobe instructs its representatives to use the ETF as a method of retaining subscribers and discouraging cancellations, and to invoke the ETF when subscribers are not ‘saved’ by retention offers, such as discounts.”
— DOJ Complaint, Paragraph 97

• This documents that Adobe’s customer service representatives did not independently decide to weaponize the ETF. They were instructed to do so as part of official company policy.
• The sequence described is a deliberate escalation script: first offer a discount; if the consumer still wants to leave, deploy the fee as a financial threat to force them to stay.

Systemic Harm

Societal Impact Mapping

Environmental Degradation

This case does not involve direct environmental harm. The following environmental dimension is documented in the broader context of Adobe’s business practices.

• Adobe’s subscription model depends on continuous cloud infrastructure growth and energy-intensive data center operations. Locking consumers into unwanted subscriptions extends their engagement with those systems beyond voluntary participation, adding environmental overhead without consumer benefit.

Public Health and Psychological Harm

Predatory subscription practices cause documented psychological harm. Financial stress is a well-established driver of anxiety and deteriorating mental health, and the Adobe complaint provides specific evidence of consumer distress.

• Consumers reported feeling desperate, trapped, and helpless when confronting Adobe’s cancellation system. One consumer used the word “desperate” in a direct email to Adobe’s CEO, a level of distress that indicates the company’s practices had moved well beyond inconvenience into active psychological harm.
• Unexpected charges of hundreds of dollars represent a serious financial shock for low-income consumers, students, teachers, and freelancers. The complaint specifically notes that Teams and Education plan subscribers had no self-cancellation option at all, meaning students and teachers were particularly exposed to the ETF ambush.
• Adobe’s practice of not disclosing ETF waivers to the general public while waiving them for consumers who threatened legal action created a two-tier system where knowing your rights determined whether you were financially harmed. Most consumers do not know that threatening a lawsuit can unlock a fee waiver they would otherwise be forced to pay.

Economic Inequality

The structure of Adobe’s hidden ETF concentrated financial harm on consumers least able to absorb surprise charges.

• Adobe’s subscription revenue grew from $7.71 billion to $14.22 billion between 2019 and 2023. The complaint documents that a significant portion of this growth came from retention driven by the ETF and the cancellation maze rather than from satisfied, freely-choosing customers.
• Adobe’s Creative Cloud products are widely used by students, emerging artists, freelancers, and small business owners. These populations are disproportionately harmed by surprise fees worth hundreds of dollars, while Adobe’s shareholders, executives, and institutional investors captured the financial benefit.
• The complaint notes that Adobe waived the ETF for consumers who threatened legal action. Access to legal knowledge is itself a class-stratified resource. Consumers with legal literacy, social capital, or access to attorneys got relief. Everyone else paid.
• Adobe’s senior executives named in the complaint, Maninder Sawhney (SVP of Digital Go To Market and Sales) and David Wadhwani (President of Digital Media Business), directed these practices from positions of significant institutional power and financial compensation, while the harm fell on individual consumers with no equivalent leverage.

The Math

The “Cost of a Life” Metric

What You Can Do

What Now?

The federal case is active. The named defendants are Adobe Inc., Senior Vice President Maninder Sawhney, and President of Digital Media Business David Wadhwani. The government is seeking a permanent injunction, civil penalties, and disgorgement of ill-gotten revenues. Here is who is watching and what you can do.

Regulatory Watchlist

• Federal Trade Commission (FTC): The originating agency that investigated Adobe and referred the case to the DOJ. The FTC enforces ROSCA and the FTC Act provisions at issue in this case. File complaints at ftc.gov/complaint.
• U.S. Department of Justice, Consumer Protection Branch: The branch actively litigating this case in the Northern District of California. Case number 5:24-cv-03630-BLF.
• State Attorneys General: The complaint notes that consumers filed complaints with state law enforcement agencies. Your state AG may have parallel consumer protection jurisdiction. Look up your state AG’s consumer complaint portal.
• Consumer Financial Protection Bureau (CFPB): Relevant for consumers who experienced unauthorized or disputed charges on credit cards or bank accounts connected to Adobe subscriptions.
• Better Business Bureau (BBB): Adobe’s practices generated a significant volume of BBB complaints cited directly in the federal complaint. Adding documented complaints here creates a paper trail regulators use.

Take Action

• If you were charged an ETF you did not know about: Contact Adobe customer service and explicitly reference Case 5:24-cv-03630-BLF. The complaint documents that Adobe has waived ETFs when consumers push back, particularly those who reference legal exposure.
• File a complaint with the FTC at ftc.gov/complaint. Volume matters. The more individual complaints on record, the stronger the government’s case for the maximum civil penalty.
• Share this article and the primary complaint document. Most consumers do not know this lawsuit exists. The complaint is public record. Making it visible is itself a form of accountability journalism and consumer protection.
• Support open-source creative software alternatives such as GIMP, Inkscape, Kdenlive, and DaVinci Resolve. Reducing reliance on subscription monopolies is the structural answer to subscription traps. Mutual aid for creative communities often includes shared licenses or access to these tools.
• Contact your federal representatives and ask where they stand on strengthening ROSCA enforcement and funding the FTC’s Consumer Protection Bureau. Regulatory enforcement is only as strong as the political will and budget behind it.