Hims & Hers Shares Tumble 14% Following FTC Privacy and Billing Lawsuit

The legal challenge, brought by the Federal Trade Commission alongside the State of Utah and Los Angeles County, centers on claims that Hims & Hers compromised user privacy by sharing sensitive medical information with third-party advertising platforms like Meta and Snap. According to the complaint, these disclosures occurred via tracking pixels despite the company’s public marketing commitments to discretion and data protection.

Regulators also accuse the firm of violating the Restore Online Shoppers' Confidence Act. The suit contends that the company enrolled consumers in subscription plans without proper consent, often billing them before a medical consultation took place. Additionally, the filing highlights the use of digital obstacles—so-called dark patterns—that made it difficult for users to cancel their services.

Following the market slide, the shareholder rights firm Hagens Berman announced an investigation into whether these alleged practices indicate systemic failures in Hims & Hers' internal controls or inaccurate financial disclosures. Reed Kathrein, a partner at the firm, noted that investigators are currently reviewing the potential impact of these regulatory findings on the company’s historical public reporting. Hagens Berman is now soliciting information from investors with significant losses and potential whistleblowers who may hold non-public details regarding the company’s operations.