Hopper Agrees to $35 Million Settlement with FTC Over Deceptive Hidden Fees in Travel App Charges
Hopper, the travel application renowned for its AI-based predictions of flight and hotel prices, has reached a settlement of $35 million after being sued by the U.S. Federal Trade Commission (FTC). The lawsuit accused Hopper of deceiving users by applying hidden fees and misrepresenting the overall costs related to its services.
This case exemplifies the regulators’ focus on “dark patterns,” which are user interface designs that trick consumers into making decisions they might not have otherwise made. Such designs may include concealing charges or pre-selecting optional extras, making it challenging for users to comprehend the actual cost of a service. This follows similar settlements by the FTC with other entities, including Match, StubHub, neobank Dave, Fortnite, and others.
The FTC claimed that Hopper misled its customers regarding the usefulness of its “VIP Support” and “Price Freeze” offerings. Many users believed these services would improve their booking process, only to discover they incurred additional expenses and limited customer support access.
Additionally, the FTC found that Hopper charged users for “Tip” and VIP Support fees, which were presented as optional but often pre-selected and concealed within the app. Consequently, users faced unexpected charges that they thought they had not agreed to, with these fees usually only visible when users scrolled down in the app.
The allegations also touch on the “Price Freeze” or “Hold the Room” service, which Hopper claimed would enable consumers to secure their booking price temporarily. However, the FTC highlighted that the app failed to adequately convey the limitations associated with this option. For example, the Price Freeze only secures the rate up to a certain limit and only if the booking remains available.
The settlement funds are designated for “consumer redress,” and Hopper is now barred from misrepresenting any pricing structures. The company must also ensure that all fees are explicitly disclosed, guaranteeing users are fully informed of the total costs before finalizing their bookings.
“We opted to settle because the issues raised are outdated and irrelevant to our current business,” stated a spokesperson for the company. “Entering into prolonged litigation over trivial, outdated matters would divert our attention from serving our current customers and partners. The settlement figure does not represent the validity of the claims; it simply reflects our decision to move forward.”
The spokesperson further remarked that after reviewing a vast amount of company records dating back to 2021, the FTC’s claims mostly centered on “primarily outdated display practices that were put in place during the pandemic, limited to the Hopper app, and discontinued by mid-2023, even before the FTC began its inquiry.”
Prior to this, the FTC’s latest efforts against “junk fees” involved a case with StubHub, which agreed to pay $10 million to customers and adjust its ticket price displays. Booking Holdings also settled for $9.5 million after facing a lawsuit from Texas Attorney General Ken Paxton, which alleged the company misled consumers by displaying low room rates while concealing essential fees until the checkout stage.
Hopper debuted its travel app in 2014 and achieved over 120 million downloads globally by 2024.
This article was updated with a statement from Hopper.
