in Newly Filed / Newly Settled Published on March 13, 2017

Audible.com Facing Bait-and-Switch Allegations Over 'Disappearing Credits'

Last Updated on April 18, 2024

Audible, Inc. and Amazon.com are the defendants in a proposed class action lawsuit filed on behalf of users who “find themselves trapped in a shell game” created by the audiobook seller and its parent group’s alleged “bait-and-switch” business tactics.

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Sounds Serious. What Does the Lawsuit Allege?

The California consumer who filed the 33-page lawsuit alleges that he and proposed class members were told by the defendants that purchased audiobook credits “never expire,” and that plan members can cancel anytime with “no strings attached.” In reality, once Audible members accrue a certain number of credits, the lawsuit claims, they begin to expire to “make room” for new credits. Even though members, in essence, aren’t receiving additional credits for their payments, the defendants still charge them as if they were, according to the suit.

“Ultimately, there is no legal or business justification for [the defendants’] bait-and-switch tactics, which begin the moment a consumer first views their websites and which continue through cancellation of the consumer’s membership plan,” the lawsuit alleges.

But What if Audible.com Members Cancel Their Plans?

The lawsuit claims that all previously purchased credits are forfeited if an Audible.com member cancels his or her plan. According to the lawsuit, Audible and Amazon lure consumers to sign up for audiobook membership plans by advertising free trial memberships and free audiobook credits, but then charge these users in perpetuity according to an automatic renewal policy.

The lawsuit claims this tactic is a prime example of the defendants’ alleged bait-and-switch scheme since:

One credit, despite the defendants’ advertising claims, does not equal one audiobook
Audiobook credits do expire, contrary to what the defendants’ purport in their advertising
There is one major string attached to the cancelation of members’ plans: the complete and immediate forfeiture of all unredeemed, prepaid credits

All of this is allegedly done without consumers’ consent, the lawsuit says.

“Audible and Amazon do not properly disclose to consumers all of the required ‘automatic renewal’ payment and cancellation terms at the point of sale (e.g., the online ‘purchase box consumers are asked to click),” the complaint reads. “As a result, [the plaintiff] and class members have been charged regularly and automatically without being fully informed of the consequences and related cancellation policy as required by law.”

The Terms and Conditions

From here, the lawsuit claims the defendants hide “unconscionable and unlawful provisions” in the terms and conditions signed by users. From the lawsuit:

“For example, the terms imposed on Audible members authorize Audible to charge any credit card linked to a member’s separate Amazon account if the credit card given directly to Audible is declined for any reason. Defendants assert this authorization and make such charges without notice, even if the other cards on the member’s Amazon account belong to a non-Audible member (e.g., spouse, relative, friend, business).”

The plaintiff alleges that as a result of this provision, potentially thousands of Amazon customers have been charged by Audible without notice—even if they aren’t Audible.com members—all because individual consumers use an Amazon account with multiple stored credit card numbers.

What About the Plaintiff’s Experience?

The plaintiff behind the lawsuit claims he signed up for a free trial membership with Audible in June 2016, for which he received a free credit to redeem an audiobook. Thirty days into his membership, he began buying a prepaid credit each month—for a $14.95 monthly payment—under Audible’s “Gold Monthly” membership plan. Based on the defendants’ marketing and advertising representations, the plaintiff believed that he would accrue one credit each month and that each prepaid credit would be good to purchase its equivalent in audiobooks.

The plaintiff decided to cancel his Audible plan in December 2016 after he had redeemed all his accrued prepaid credits, with the intent of using his final two unredeemed credits at a time of his choosing on books of his choosing. Upon cancelation of his plan, however, the plaintiff claims he received a surprise:

“Upon cancelling his membership plan, he learned that—contrary to Audible’s and Amazon’s representations—the credits he had purchased but not yet redeemed had automatically and immediately expired and that, due to his cancellation, he had forfeited that money he paid for credits without receiving his audiobooks.”

Who Is Included in the Proposed Class for this Lawsuit?

The lawsuit seeks to cover a class of consumers throughout the United States who have been charged for an Audible.com membership plan within the last four years, as well as five additional subclasses:

Proposed False Advertising Subclass– for all consumers in the U.S. who “paid for an Audible membership plan in reliance on [the defendants’] representations regarding credits, credit expiration/forfeiture, credits equaling audiobooks, or membership cancellation”
Proposed Unlawful Gift Certificate Subclass – for all consumers in the U.S. who “paid for an Audible membership plan and received a credit that was capable of expiring within five years from the date of purchase”
Proposed Expired of Forfeited “Credits” Subclass – for consumers nationwide who “paid for an Audible membership plan and received a credit that expired based on a roll-over policy or a cancellation policy”
Proposed Unlawful Automatic Renewal Payments Subclass – for all consumers in California who bought an Audible membership plan and whose payment method was subject to the defendants’ automatic renewal policy
Proposed Unlawful Amazon Credit Card Charges Subclass – for all consumers across the U.S., whether or not they were an Audible member, who had “a payment method on account with Amazon that was charged by Audible because the payment method provided directly to Audible was declined”

The full complaint can be read below.

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