"Free" Trials Cost $60 Million

The Federal Trade Commission ("FTC"), and a large grocery delivery service recently agreed to resolve allegations that the company, among other things, offered consumers free trials of its paid membership program but failed to disclose certain material post-trial program terms. Below, we discuss the FTC's allegations in detail, the terms of the proposed settlement, and why it's important to comply with federal and state marketing regulations.

When Are Free Trials Not Free?

In its Complaint, the FTC alleged that Maplebear, Inc., doing business as Instacart, offered consumers 14-day free trials of its membership program, Instacart+, but failed to clearly and conspicuously disclose that: (1) the free trials automatically converted into paid annual subscriptions at the expiration of the free trial period; and (2) membership fees would be canceled and refunded only under limited circumstances, despite Instacart advertising that consumers they could "cancel anytime."