Although he is a Costco member, Russell George rarely uses his membership. That’s not out of the ordinary; many people enroll, go through a phase of purchasing 48 rolls of paper towels all at once, and then progressively stop making the trips to the warehouse while the yearly renewal process continues in silence. The distinction is that George claims that if he had been given a fair chance, he would have canceled his membership when it came time to renew it. Rather, his credit card was charged $65, the notice was sent sixty days prior to the charge, and the result was a class action lawsuit that Costco is currently required to respond to in court.
Although the legal matter appears technical at first glance, it isn’t. The Automatic Renewal Law of California, which went into effect in July 2025, establishes a window of time within which businesses must give customers notice before charging them for annual renewals: no earlier than 45 days and no later than 15 days. By that calculation, sixty days are out of the window. It’s too early. According to the complaint, Costco’s standard email notice, which arrives two full months before the card is charged, is “untimely and deficient” and denies customers the opportunity to take action before it’s too late. The time to cancel is long gone by the time the charge actually shows up.
When you consider it at scale, this type of case appears small. There are about 130 million Costco cardholders worldwide, and a sizable percentage of them reside in California. The renewal process operates automatically; an email is sent, a charge is made, and the majority of members either don’t notice the charge until they check their bank statement or don’t want the membership enough to care about it. The law being used here is specifically intended to stop that autopilot and require a brief period of real consumer choice prior to the money being transferred. It’s not that Costco failed to send a notice that George is complaining about. Sending one sixty days out, which is well past the point at which a member would consider taking action, serves more as a formality than a true warning.
Key Information: Costco Auto-Renewal Class Action Lawsuit
| Field | Details |
|---|---|
| Defendant | Costco Wholesale Corporation |
| Plaintiff | Russel George — California resident |
| Lawsuit Type | Class action |
| Filed | April 2026 |
| Preliminary Hearing | Scheduled for June 2026 |
| Core Allegation | Costco sends auto-renewal email notices 60 days before charging, violating California’s Automatic Renewal Law requirement of 15–45 days |
| Relevant California Law | California Automatic Renewal Law (effective July 2025); False Advertising Law; Consumer Legal Remedies Act; Unfair Competition Law |
| Legal Standard | Renewal notice must be sent between 15 and 45 days before the charge — no earlier, no later |
| Costco’s Notice Timing | 60 days before card is charged — alleged to be “untimely and deficient” |
| Membership Costs | Gold Star: $65/year; Executive: $130/year |
| Cancellation Method | Toll-free phone number or in-store visit |
| Relief Sought | Jury trial; damages for plaintiff and class members charged without adequate notice |
| Related Costco Litigation | Separate 2026 lawsuit over Nebraska chicken processing plant — alleged Salmonella contamination |
| Federal Context | FTC’s nationwide auto-renewal “click to cancel” rule struck down by federal appeals court, July 2025 |
Alleging violations of California’s Unfair Competition Law, Consumer Legal Remedies Act, and False Advertising Law, the lawsuit also targets Costco’s cancellation policies. Companies must permit customers to cancel using the same method they used to enroll in order to comply with California law, which presents a unique challenge for Costco. Memberships can be bought online, but at the moment, cancellations must be made in person at a warehouse or by calling a toll-free number. This kind of discrepancy is what consumer protection law was designed to address for a member who signed up with a few clicks at midnight and simply wants to discontinue the arrangement without having to drive to a big-box store in a strip mall off the freeway or navigate a phone tree.
It’s important to note that this case comes after a much larger federal effort to address this issue nationally. A rule that would have required businesses to make cancellation as easy as enrollment—if you can sign up with one click, you should be able to cancel with one click—was finalized by the Federal Trade Commission during the Biden administration in 2024. Additionally, it would have mandated recurring charge confirmation notices and yearly reminders. The rule was supported by a vast amount of consumer complaint data and had simple logic. In July 2025, it was overturned by a federal appeals court. The Costco lawsuit serves as a test of how seriously courts will enforce the patchwork of state laws that remain in its absence, with California having some of the strictest.
For its part, Costco has not made a public response to the complaint. The case is still very early because a preliminary hearing is set for June. It’s still unclear how Costco will build its defense, whether the court will certify the class, and how broadly George’s attorneys will define the covered membership population. The legal question could be shifted to whether “early” notice is functionally equivalent to no notice when the timing compromises the consumer’s ability to act. One possible argument is that sixty days’ notice is preferable to the legally required forty-five—more advance warning, not less. That’s a really intriguing legal question, and neither side is clearly losing.
As this case progresses, it seems to fit into a much broader discussion about subscription and membership businesses and the friction they purposefully create for cancellation. By all measures, Costco is not a bad actor; its membership satisfaction ratings are genuinely high, and most retailers would be envious of the company’s cultural reputation for treating customers fairly. However, whether Costco is a good company isn’t really at issue in the auto-renewal lawsuit. It concerns whether the renewal system’s mechanics satisfy a particular law’s requirements. The sixty-day notice window might be more difficult to defend on those more restrictive terms than it first seems.
