1-800-Flowers to pay New York $375,000 in penalties over subscription policies
1-800-Flowers' corporate headquarters at 2 Jericho Plaza, in Jericho. The company has agreed to settle an investigation into its subscription policies. Credit: Google maps
Customers of Long Island-based 1-800-Flowers.com could receive refunds after the New York Attorney General’s Office said the company agreed to pay $375,000 to settle complaints over its subscription policies.
Attorney General Letitia James said Wednesday an investigation found the company failed to make certain disclosures related to its Celebrations Passport subscription service that allows consumers to avoid shipping and service fees.
James said the company, based in Jericho, also failed to issue subscribers an acknowledgment required by New York law and didn’t notify subscribers before their automatic renewal date. The service is priced between $14.99 and $29.99 annually, depending on promotions, according to the attorney general's office.
The investigation covered the company’s policies between February 2021 and December 2022.
"Companies that trick consumers into signing up for recurring subscriptions are breaking the law and costing New Yorkers their hard-earned money," James said in a statement.
1-800-Flowers did not respond to a request for comment.
1-800-Flowers neither admitted nor denied the findings of the attorney general’s investigation as part of the settlement, which stated the company agreed to the penalties to avoid the time and costs associated with litigation.
The company issued disclosures about its renewal policy but these terms were buried in fine print, links to separate web pages with terms and conditions or in pop-out boxes on its website, the attorney general’s office said.
State law requires companies make clear disclosures about subscription policies to consumers, receive their consent for automatic renewals and send a post-purchase acknowledgment.
Gov. Kathy Hochul last year signed legislation to make it easier to cancel online subscriptions by requiring businesses to notify consumers of upcoming renewals.
Companies often set extra hurdles, such as requiring customers to access multiple links, to call customer support or to send a written request to cancel, said Kimberly Palmer, a personal finance expert at NerdWallet.
She advised consumers to set calendar reminders to cancel subscriptions before the renewal date and to reach out to the nonprofit Better Business Bureau or their state attorney general’s office when they experience issues.
"Automatically recurring subscription plans often capitalize on people forgetting they signed up for something," she said.
The state attorney general’s office has reached settlements with companies including Uber, Equinox and SiriusXM in recent years over their subscription and cancellation policies.
Some consumers in New York and nationwide will be eligible for 1-800-Flowers refunds if they meet certain criteria.
New Yorkers who bought a membership through the company’s website between Feb. 9, 2021, and June 26, 2022, or through its mobile app between Feb. 9, 2021, and Dec. 21, 2022, can get a full refund of their most recent fee if they also filed a complaint to certain organizations. Those organizations are the attorney general’s office, the Better Business Bureau or the Federal Trade Commission.
New Yorkers can get a $20 refund if they purchased using the website or mobile app between February 2021 and December 2022; had their membership automatically renewed for a second year; and didn’t use the free shipping or no-service-fee benefits during either year beyond their first purchase with the membership.
Other U.S. consumers may be eligible for $20 refunds if they enrolled in the program during certain dates, are not members of a California class-action lawsuit tied to the policy and never used the free shipping benefits.
Shares of 1-800-Flowers jumped before the market close to $4.21, rising 0.2% on Wednesday, after previously trading as low as $4.07. On Thursday, they settled down 7.6% to $3.89.
In addition to the company's signature floral business, it operates e-commerce brands including Harry & David, Shari's Berries and The Popcorn Factory.
Jonathan LaMantia covers residential real estate and other business news on Long Island. He previously covered the business of health care for Crain's New York Business.
