Ninth Circuit Affirms Dismissal of Putative Class Action Against YouTube Based on Oregon’s Autorenewal Laws

In a concise decision issued earlier this month, the Ninth Circuit affirmed a district court ruling that individuals failed to state a claim against YouTube and parent company Google based on alleged violations of Oregon's Automatic Renewal Law ("ARL") and Free Offer Law ("FOL"). See Walkingeagle v. Google, LLC, 2024 WL 4379734 (9th Cir. Oct. 3, 2024). The appellants initially brought their claims as a putative class action, alleging that YouTube/Google failed to comply with ARL and FOL requirements related to subscription services YouTube Music, YouTube Premium, and YouTube TV. The district court dismissed the case with prejudice, which the Ninth Circuit affirmed.

The ARL requires merchants to present automatic renewal offer terms or continuous service offer terms in a clear and conspicuous manner at checkout, and the FOL similarly requires disclosure of certain terms for free-trial offers. Under the ARL, a "clear and conspicuous" disclosure is one that is "in larger type than the surrounding text, or in contrasting type, font or color to the surrounding text of the same size, or set off from the surrounding text of the same size by symbols or other marks, in a manner that clearly calls attention to the language."

Appellants argued that whether a term is clear and conspicuous is a matter of fact that should proceed to summary judgment, but the Ninth Circuit disagreed, ruling that the question could be decided as a matter of law in this case. Specifically, the Court found that the automatic renewal terms were clear and conspicuous at checkout, as required by the laws, since the terms were displayed off-set from any other text and were "the only text on the page." Further, the Court noted that for the YouTube Music and YouTube Premium pages, the most important information was bolded or in another color than the surrounding text.

The Ninth Circuit also affirmed the district court's finding that YouTube/Google properly obtained "affirmative consent" to automatic renewal, as required by the ARL. The district court found that affirmative consent was provided by clicking the "subscribe button" after being presented with the terms of the service. Appellants argued that something more was required to demonstrate consent, such as selecting a "checkbox," but the Ninth Circuit explained that such a "requirement is found nowhere in the ARL" or "anywhere in our caselaw."

Lastly, the Court found that appellants failed to sufficiently allege YouTube's cancellation policy violated the ARL or FOL, which each require that subscribers can cancel subscriptions via phone, email, a post-office address, or "another cost-effective, timely, and easy-to-use mechanism[.]" Though appellants contended that the online cancellation mechanism was "obscure, confusing, and time-consuming," the Court found these allegations insufficient because appellants had not alleged that they tried to cancel using another cancellation method YouTube provided: a link in the confirmation email.

This decision offers useful guidance for companies subject to Oregon's ARL and FOL on what practices comply with those laws.