Overview
- The FTC, alongside California and Utah, has initiated a lawsuit against Hims & Hers for alleged breaches of privacy, billing, and subscription regulations.
- It is claimed that the company shared sensitive health information with advertising platforms despite assurances of confidentiality.
- The lawsuit also accuses Hims of enrolling consumers in recurring prescription subscriptions without their informed consent.
The Federal Trade Commission (FTC), in collaboration with California and Utah, has filed a lawsuit against the telehealth provider Hims & Hers Inc. The complaint alleges that the company misled consumers by promising a private healthcare experience while sharing sensitive health data with advertising platforms such as Meta and Snap.
Filed on Tuesday in the U.S. District Court for the Northern District of California, the complaint asserts that Hims assured users that their services were "100% online, private, and secure" and that only healthcare providers would access their medical records and sensitive health details. However, regulators allege that the company disclosed this information to third-party ad networks without adequately informing users.
“The FTC’s complaint outlines a concerning scenario where consumers are unknowingly locked into recurring subscriptions, and their most private health information is shared with third parties without consent,” stated Christopher Mufarrige, Director of the FTC’s Bureau of Consumer Protection. He added that the FTC is committed to protecting consumers' rights to choose which products they wish to use and to maintain their health information's privacy.
The complaint details how Hims utilized tools like Meta Pixel and Meta Conversions API, as well as tracking technologies from Google, Microsoft, Reddit, TikTok, Pinterest, X, and other advertising partners to relay information about users' activities on its platforms.
Hims & Hers, which is publicly traded, offers prescription medications for various health issues but is particularly recognized for its “sexual wellness” products. The FTC's allegations suggest that the company's practices impacted individuals seeking treatment for conditions such as erectile dysfunction, premature ejaculation, mental health issues, hair loss, and weight loss. The complaint alleges that Hims heavily marketed its privacy guarantees across its website and through various advertising channels, including TV, radio, podcasts, and influencer promotions, describing their services as "private" and "discreet."
“Similar to the Meta and Snap pixels, numerous tracking pixels captured and shared users’ health information through tracking events that were contrary to Hims’ privacy assurances,” the complaint claims.
Additionally, the lawsuit charges Hims & Hers Inc. with misleading subscription practices.
The complaint states that the company promoted "free consultations" and claimed consumers could assess whether a treatment was suitable for them before purchasing medication. However, regulators allege that many customers were automatically charged and enrolled in recurring prescription subscriptions immediately after a provider assessed their intake form, without a chance to review or approve the treatment. It also claims that Hims failed to provide clear refill dates and made it challenging to cancel subscriptions by concealing cancellation options behind multiple menus and screens.
The lawsuit cites violations of the FTC Act, the Restore Online Shoppers' Confidence Act, California's False Advertising Law, and Unfair Competition Law, as well as Utah's Consumer Sales Practices Act. The FTC and its state partners are seeking a permanent injunction, financial compensation, civil penalties, and other remedies.
“The Commission files a complaint when it has reason to believe that the defendants are violating or are about to violate the law, and it seems to the Commission that such action serves the public interest,” the FTC stated. “The outcome of the case will be determined by the court.”
Hims & Hers has not yet responded to a request for comment from Decrypt.
This lawsuit is part of a broader trend of FTC actions aimed at addressing issues related to privacy, deceptive marketing, and consumer protection.
In 2022, Epic Games agreed to pay $520 million to settle claims of violating children's privacy laws. The agency has increasingly scrutinized artificial intelligence, cautioning that it could "turbocharge" scams and misleading practices while taking action against companies accused of inflating their AI capabilities.
Most recently, in May, the FTC reached a nearly $1 million settlement with Cox Media Group and two marketing firms over allegations of false advertising related to an AI-powered service that purportedly targeted ads by listening to consumers' conversations via smart devices.