Man in California sues Costco for hidden membership renewal practices

Costco Faces Lawsuit Over Automatic Membership Renewals

A man from California is taking legal action against Costco, alleging that the company renews memberships without adequate notification, which complicates the cancellation process.

Plaintiff Russell George has initiated a class action lawsuit, claiming that Costco has breached California law. This law mandates that companies provide customers with a notice of 15 to 45 days before billing them for an additional year’s service. Reports suggest that George insists he received a renewal notice, but it was sent too soon to be useful.

He contends that if he had received a proper reminder before the charge, he likely would have canceled since he doesn’t use his membership enough to warrant the expense.

The lawsuit zeroes in on how challenging it is to cancel a membership at Costco. Currently, those wishing to opt out must either call a toll-free number or visit a warehouse in person. However, California law stipulates that customers must be allowed to cancel their subscriptions in the same manner they initially signed up. So, if someone joined online, cancellation should also be available online. George’s attorneys argue that Costco hasn’t made this process straightforward.

This legal dispute happens amid growing criticism of subscription practices across the nation.

In 2024, the Federal Trade Commission tried to introduce a “click-to-cancel” rule that would’ve made it easier for consumers to cancel subscriptions. Unfortunately, a federal appeals court overturned this regulation in July 2025, stating that proper procedures were not followed.

Costco currently offers two types of memberships: the Standard Plan for $65 per year and the Executive Membership for $130 annually. Benefits include 2% cash back on eligible purchases, discounts on travel, and exclusive deals on services like insurance and vacation packages. Members also enjoy savings on bulk purchases, gas discounts, and access to various in-store amenities such as pharmacies and optical centers.