FTC and eight states sue Toast over hidden fees and subscription practices
The U.S. Federal Trade Commission and eight state attorneys general filed a lawsuit against restaurant‑technology firm Toast, alleging it charged hidden and unauthorized fees, added unwanted services and made it hard for restaurants to cancel subscriptions. Toast says the Restore Online Shoppers' Confidence Act does not apply to its negotiated B2B contracts and will vigorously defend the case. The company added that the litigation will not change its pricing, customer service or support.
Why it matters
The complaint triggered a drop of more than 1% in Toast's after‑hours share price, indicating immediate market reaction. The lawsuit could expose the company to potential fines, injunctive relief or changes to its contract terms if regulators prevail.
Key facts
- 1The FTC and eight states filed the lawsuit in a California federal court. rttnews.com
- 2The complaint alleges Toast charged an undisclosed $0.99 processing fee on some online orders from September 2021 through July 2023. rttnews.com
- 3Toast operates its platform at roughly 200,000 restaurant locations. stocktitan.net
- 4Toast has been cooperating with the FTC's review since mid‑2025. stocktitan.net
- 5Toast says the lawsuit will not affect its pricing, customer service or support. stocktitan.net
- 6Toast shares fell more than 1% in after‑hours trading, closing at $31.50 the prior day. rttnews.com
Summary written by AlphAI AI Desk from 6 of 6 sources. Not investment advice. Figures are as stated by the linked sources.