Instacart to pay $60m refunds after FTC deceptive ads case

Instacart will pay US$60 million in refunds to consumers after reaching a settlement with the US Federal Trade Commission over allegations of deceptive business practices.

The FTC accused Instacart of misleading customers with false ad claims, hiding mandatory service fees, making unclear refund policies, and enrolling users in paid subscriptions without clear consent.

The agency said Instacart advertised “free delivery” but charged mandatory service fees that were not clearly disclosed, sometimes adding up to 15% to orders.

The FTC also said Instacart failed to offer full refunds as advertised and instead often issued partial credits for future purchases.

Hundreds of thousands of consumers were affected by automatic charges for the Instacart+ subscription after free trials.

As part of the settlement, Instacart must change its ad and disclosure practices and obtain informed consent for future subscription charges.

The proposed order is pending approval by the US District Court for the Northern District of California.

🔗 Source: Federal Trade Commission

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FTC settlement sends $60 million in refunds; court review pending

Instacart, a US-based grocery delivery company, will pay $60 million in refunds under a Federal Trade Commission (FTC) settlement. The order needs approval from the US District Court for the Northern District of California, and Instacart has not shared the settlement’s financial impact.
The deal cites mandatory service fees despite free delivery claims. It also faults auto-enrolling hundreds of thousands into Instacart+ (paid membership program) after free trials. The filing omits subscriber counts and revenue data.
The order requires changes to consent and disclosures. Instacart faces an FTC probe into pricing after Consumer Reports, a nonprofit consumer advocacy and product-testing organization, said that AI pricing experiments may inflate grocery bills.

Eighth Circuit tosses FTC Negative Option Rule; state rules lead

July 8, 2025, the US Court of Appeals for the Eighth Circuit vacated the FTC’s Negative Option Rule, finding the agency skipped a preliminary regulatory analysis (a cost-benefit review for major rules over $100 million annually). The rule covers automatic renewals and free trials.
Subscription services face uncertainty. The 1973 rule still applies but mainly covers pre-notification plans (book-of-the-month clubs that ship unless users decline in advance). State laws like California’s automatic renewal statutes still apply, and some states adopted ideas from the vacated rule.
Compliance software vendors that serve marketplaces and subscription apps should focus on state rules while the FTC restarts rulemaking with a preliminary regulatory analysis and enforcement continues under laws like the Restore Online Shoppers’ Confidence Act (ROSCA).