Costco Hit With Class Action Over Automatic Membership Renewals

Costco Hit With Class Action Over Automatic Membership Renewals...

Costco is facing a class action lawsuit alleging the wholesale giant failed to properly notify customers about automatic membership renewals. The complaint, filed in federal court in Washington state on April 11, claims the retailer violated consumer protection laws by not providing clear disclosures.

The lawsuit comes as millions of Costco members receive renewal notices ahead of the company's fiscal year-end in August. Plaintiffs argue the retailer automatically charges customers' credit cards without adequate warning, sometimes catching shoppers by surprise.

"Costco's practice of automatically renewing memberships without affirmative consent is deceptive," said attorney Mark Johnson, who filed the case. The complaint cites California's Automatic Renewal Law and similar statutes in other states requiring clear renewal terms.

Social media has seen growing complaints about the policy in recent weeks, with many customers reporting unexpected $60 or $120 charges. The lawsuit seeks refunds for affected members and changes to Costco's renewal practices.

Costco's membership model generates nearly $4 billion annually. The company had not responded to requests for comment as of Thursday afternoon. Legal experts say the case could force retailers nationwide to revise automatic renewal policies.

The lawsuit represents all Costco members in California and could expand to other states. It follows similar actions against companies like Amazon and Adobe over subscription practices. A hearing date has not yet been set.