Consumer protection: FTC sues Lens.com over 'Taxes & fees'

The news: The Federal Trade Commission, with the Utah and Nevada attorneys general, sued contact lens retailer Lens.com Inc. on October 2, alleging a long-running deceptive pricing scheme. The joint complaint, filed in the U.S. District Court for the District of Nevada, also names owner Cary Samourkachian and an affiliated entity, Speed Commerce LLC. It alleges that Lens.com advertised artificially low prices and then added a mandatory “Taxes & fees” charge that routinely doubled the price, costing consumers hundreds of millions of dollars. The allegations are unproven; the court will decide the case.

Why it matters: For consumer protection, this is a clean example of a drip-pricing complaint: the number in the ad is not the number at the register. The FTC says the low prices appeared in sponsored Google search ads and on the Lens.com website, while the real price included a substantial charge buried deep in checkout. Contact lenses are a recurring health expense, and the agency says obscuring the total price stopped customers from comparing Lens.com with competitors.

The complaint makes several specific claims about the checkout flow. The “Taxes & fees” line allegedly sat below the visible portion of the screen, with a prominent “Continue” button encouraging people to move on without scrolling, so some shoppers never saw it. The label also suggests state sales tax, yet many states exempt contact lenses from sales tax or have none, according to the complaint.

By the numbers:

• Often 2x: how much the complaint says the hidden charge multiplied the advertised price
• Hundreds of millions of dollars: the alleged cost to consumers
• 3 plaintiffs: the FTC, Utah and Nevada
• 2-0: the Commission vote authorizing the complaint

The big picture: The complaint extends to Lens.com’s “AutoRefill” subscription, which automatically charges for recurring shipments. The FTC alleges the same hidden charge was not disclosed before billing information was collected, and that cancellation instructions and the deadline to cancel before the next shipment were buried outside the purchase flow. The claims invoke the FTC Act, the Restore Online Shoppers’ Confidence Act, the Gramm-Leach-Bliley Act, and Utah and Nevada consumer laws, including Utah’s Automatic Renewal Contracts Act.

Christopher Mufarrige, the FTC’s Bureau of Consumer Protection director, tied the case to lowering healthcare costs by stopping deceptive practices that raise prices.

What’s next: The District of Nevada court will decide the case. Anyone enrolled in an automatic refill program can review their order confirmations for a line labeled taxes or fees and confirm how and by when they can cancel.