Costco is getting hit with a class action lawsuit and it’s all because of a California man who’s accusing the company of violating the state’s law on auto-renewals for memberships.
So, there’s a law requiring companies to give customers a renewal notice at least 15 days — and no more than 45 days — before an annual membership expires. Russel George, the California resident, says Costco didn’t comply with that law.
Costco currently offers two membership tiers: a $65 annual membership and an “executive” membership costing $130 a year.
George has a membership, but he doesn’t use it enough to have a reason to keep it.
“Had the plaintiff been provided this notice in a timely manner, he would have canceled his membership and not gone forward with the auto-renewal,” the complaint said, according to AOL.
Costco’s policy allows members to cancel memberships by contacting a toll-free number or stopping by a store location.
The California law also requires that “consumers must be able to cancel using the same method of communication as used to enroll in the plan or the method that the consumer generally interacts with the business.”
The businesses must also offer “a toll-free phone number, email address, or other easy-to-use cancellation method,” according to the California Attorney General’s Office.
For those who can recall, the Federal Trade Commission tried to put in place similar nationwide auto-renewal rules in 2024 under the Biden Administration, where businesses would have been required to make a cancellation as easy as enrollment.
For example, if it takes one click to enroll, it should be just as easy to cancel. It would also require annual reminders and confirmations for renewals of non-physical goods.
But a federal appeals court struck that rule down in July 2025.
The case against Costco is scheduled for a preliminary hearing in June.