Nowadays, it seems easy to cancel corporations, people, society, and even the little shop around the corner. But bless our impatient hearts if we even think about ending a gym membership or music subscription. Except in New York state, where a judge recently ruled that SiriusXM’s cancelation policy violates federal law.
As reported by The Verge, SiriusXM was sued by the state last year amidst claims that subscribers who attempted to cancel were essentially kept hostage, either through incessant questions or repetitive retention offers. According to the suit, “Sirius deliberately wastes its subscribers’ time even though it has the ability to process cancellations with the click of a button.”
The suit also claimed that SiriusXM’s own data showed customers spent an average of 11.5 minutes on the phone or 30 minutes online with customer service agents. Before you discount this as frivolous, a key point was the Restore Online Shoppers’ Confidence Act (ROSCA), a consumer protection act signed by Congress in 2010.
The act states that consumers must be provided “simple mechanisms” to stop recurring charges, particularly subscription services. An investigation by the attorney general’s office found that would-be cancelers were kept on the phone for extended periods while being pitched “as many as five retention offers.”
So, New York sued SiriusXM for not only being a time suck, but because its long customer service calls were illegal, anyway. The judge agreed, stating SiriusXM’s cancellation practices were “long and burdensome.”
“Their cancellation procedure is clearly not as easy to use as the initiation method,” he said.
As a result, SiriusXM will have to change its cancellation process, at least in New York. How or what the updated policy would entail wasn’t made clear.
Separately but not unrelated, the Federal Trade Commission (FTC) announced a new “Click to Cancel” rule last month. In the same vein as the ROSCA, businesses have to “make it as easy for people to withdraw from your program as it was to sign up.” This includes not requiring customers to chat with a rep—either in person, on the phone, or online—if they weren’t required to during sign-up. The FTC’s Click to Cancel rule will go into effect next year.
SiriusXM, of course, plans to appeal the New York judgment. “While the Court found some technical violations of a Federal statute, it did not find that SiriusXM ever deceived anyone or committed any fraud,” said SiriusXM spokesperson Maggie Mitchell in a statement to The Verge. Regarding the FTC, Mitchell said SiriusXM will adhere to its new cancellation requirement.
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