FEES JUNKED — FTC Issues Final Rule On Deceptive Pricing Junk Fees And What This Means For California Consumers
The Federal Trade Commission finally issued the federal rule regarding deceptive junk fees
The Federal Trade Commission (FTC) has issued a groundbreaking rule to combat hidden “junk fees,” mandating full price transparency for consumers across key industries.
This new federal regulation mirrors and expands upon California’s Honest Pricing Law (SB 478), creating a robust framework to eliminate deceptive pricing practices nationally.
R23 Law’s Deceptive Pricing Consumer Lawyers are here to help you navigate your rights under both state and federal laws and ensure you are not overcharged or misled by hidden fees.
What Are Junk Fees? Understanding the FTC’s New Rule
Junk fees, often referred to as “drip pricing,” are the extra mandatory charges added to a service or product after the initial price is advertised. These include service, resort, and convenience fees, which can inflate costs significantly.
Under the new FTC rule, businesses must disclose all fees upfront in the advertised price. For instance:
Hotels and Rentals: A hotel room previously advertised for $100 but adding $50 in resort fees must now display the total cost of $150 from the start.
Event Tickets: Ticket sellers, such as Ticketmaster, must list the total price of tickets, including convenience and service charges .
This rule applies to hotels, short-term rentals, and event ticket sellers and becomes enforceable 120 days after publication in the Federal Register .
How Does the FTC Rule Compare to California’s Honest Pricing Law?
California’s SB 478 is a trailblazing state law that sets high standards for pricing transparency. Taking effect on July 1, 2024, the law requires businesses in various industries to include all mandatory fees in their advertised prices. However, there are differences:
California’s Comprehensive Approach: SB 478 applies to a broader range of industries, including food delivery and restaurants. For restaurants specifically, additional charges must be displayed prominently, though exempt items can still be listed separately under SB 1524 .
FTC Rule’s Scope: While the FTC rule focuses on national uniformity, it excludes certain industries like car rentals and airline fees, which are regulated separately. California’s laws often cover these sectors with unique regulations .
Both the FTC and California laws aim to protect consumers from misleading practices, foster fair competition, and eliminate surprise charges at checkout.
Why Eliminating Hidden Fees Benefits Consumers
Mandatory upfront fee disclosure transforms the consumer experience in three significant ways:
Transparency for Budgeting: Knowing the full cost upfront allows consumers to plan and compare options without being blindsided by hidden charges.
Fairer Competition: Businesses must compete on actual pricing rather than exploiting loopholes to appear cheaper.
Reduced Stress and Confusion: With fewer surprises, consumers can enjoy their purchases or services without financial shocks.
At R23 Law, we’ve seen firsthand how hidden fees disproportionately affect vulnerable groups, such as the elderly and disabled. These new laws take a critical step in safeguarding their rights .
How to Spot and Report Hidden Junk Fees
Even with these laws in place, businesses may still attempt to skirt the rules. Protect yourself by following these steps:
Document Advertised Prices: Take screenshots or save advertisements and compare them to your final bill.
Keep Receipts and Emails: Save all documentation, including receipts and confirmation emails, which can be used as evidence.
Report Violations:
File complaints with the FTC for violations of the new federal rule.
Report California violations to the Attorney General or consider legal action under the Consumers Legal Remedies Act (CLRA).
Seek Legal Help: R23 Law’s Deceptive Pricing Consumer Lawyers can help you navigate the complex legal landscape and recover damages if you’ve been affected by unfair pricing practices.
The Importance of Strong Enforcement Mechanisms
Both California’s SB 478 and the FTC’s rule include robust enforcement measures to ensure compliance:
FTC Penalties: Businesses violating the federal rule can face civil penalties of up to $51,000 per day, depending on the scope of the violation .
California’s Legal Path: California’s Honest Pricing Law allows consumers to file lawsuits under the CLRA, a powerful legal tool that provides remedies such as restitution, injunctive relief, and even punitive damages .
How R23 Law’s California Deceptive Pricing Consumer Lawyers Can Help
At R23 Law, we specialize in holding businesses accountable for deceptive pricing practices. If you’ve been charged hidden fees or misled by incomplete pricing disclosures, our experienced team of consumer protection attorneys can:
Review your case and determine the best legal strategy.
File claims under California’s SB 478, the CLRA, or the FTC rule.
Recover damages for financial harm caused by undisclosed fees.
Transparency in pricing isn’t just good business—it’s the law. Let R23 Law’s California Deceptive Pricing Consumer Lawyers ensure your rights as a consumer are protected.
Stay Ahead of Hidden Fees: Protect Your Rights By Contacting Us Today!
The FTC’s new rule, combined with California’s proactive laws, marks a significant victory for consumer rights. However, enforcing these protections requires vigilance and the right legal representation.
Contact R23 Law’s California Deceptive Pricing Consumer Lawyers for a free consultation and take the first step toward justice and transparency.
