Clothing retailer ‘Adore Me’ to refund consumers for recurring negative-option membership

Company to pay refunds to customers, make cancellations easier, cease deceptive practices

Affected Minnesotans may file with the AG’s Office by June 27 to ensure eligibility for refund

June 16, 2023 (SAINT PAUL) — Minnesota Attorney General Keith Ellison announced today the final approval of a $2.35 million settlement with clothing retailer Adore Me primarily regarding the company’s so-called “VIP Membership,” which was advertised to consumers as a way to save money on their order. By selecting to utilize the “VIP Membership,” however, consumers were enrolled in a negative-option contract, requiring them to jump through hoops to avoid paying a recurring $39.95 monthly charge for store credit which in some cases expired, sending the money straight into Adore Me’s bank account.

The multistate investigation found that Adore Me made cancellation of VIP Membership significantly more difficult than enrollment by, among other things, requiring cancellation to be by phone, and artificially throttling its own ability to process cancellations in a timely fashion.

The settlement requires Adore Me to send notices to consumers regarding outstanding recurring charge balances to offer refunds. It also requires Adore Me to provide refunds to those Minnesota consumers who file a complaint with the Attorney General’s Office before June 27, 2023, indicating that the consumer was not aware or did not knowingly consent to be enrolled in a membership program with Adore Me. Consumers may file complaints with the Attorney General’s Office through its online complaint form.

As of July 2022, 15,277 Minnesotans had signed up VIP Membership plans. Any number of them may be unaware that they even have that membership.

“Negative option contracts are sneaky ways of taking money out of consumers’ pocketbooks without asking for authorization for each charge,” Attorney General Ellison said. “This Office has repeatedly supported stronger regulations around negative-options contracts, and we will continue to fight for full disclosure from companies trying to use these tactics.”

The settlement also requires Adore Me to take affirmative steps to obtain express, informed consent from consumers enrolling in membership programs, and to take other steps to avoid future consumer confusion.

Finally, Adore Me will pay a civil penalty to the State of Minnesota of $57,511.64. These dollars will go into the State’s General Fund.

Attorney General Ellison is joining the settlement as part of a bipartisan group of 32 attorneys general. The pending Assurance of Discontinuance between Adore Me and the Attorney General’s Office has been filed with the Hennepin County District Court.