Costco is facing a class-action lawsuit filed by a California man who claims the retailer failed to properly notify customers before automatically renewing memberships and charging their accounts.
The lawsuit, brought by Russel George, alleges that Costco violated California's Automatic Renewal Law by sending a renewal notice outside the required timeframe.
Under the law, companies must notify customers between 15 and 45 days before charging them for another year of service, Yahoo reported.
George says he received his notice about 60 days before the charge, making it too early to be useful.
According to the complaint, George had been unsure about keeping his membership and would have canceled if he had received the reminder at the correct time. Instead, he only realized the renewal after Costco charged him $65 for his standard membership.
The case also highlights concerns about the company's cancellation process.
George's legal team argues that Costco does not offer a simple way to cancel memberships online, even if customers originally signed up through the internet.
Current options require members to either call a toll-free number or visit a warehouse in person.
California man hits Costco with class-action lawsuit over alleged sneaky membership charge https://t.co/p6188YJh2J pic.twitter.com/EaEybxdwJ4
— New York Post (@nypost) April 13, 2026
Lawsuit Claims Costco Violated Subscription Laws
California law states that businesses must allow customers to cancel subscriptions using the same method they used to enroll.
According to the NYPost, the lawsuit claims Costco's system fails to provide a "straightforward" option, making it harder for customers to opt out.
The legal filing cites several state laws, including the Automatic Renewal Law, the False Advertising Law, the Consumers' Legal Remedies Act, and the Unfair Competition Law.
George is seeking damages and a jury trial on behalf of other customers who may have experienced similar issues.
The case comes at a time when subscription practices are under increasing scrutiny across the United States.
In 2024, the Federal Trade Commission proposed "click-to-cancel" rules that would have required companies to make cancellations as easy as sign-ups.
However, a federal appeals court struck down the rule in July 2025, saying proper procedures were not followed.
Costco, which has about 82 million paid members, has not publicly commented on the lawsuit.
Originally published on vcpost.com
