A recent ruling in Mahlum v. Adobe Systems Incorporated in the Northern District of California should be of at least mild interest to lawyers who support internet service companies that offer services on a subscription basis. Last week District Judge Lucy Koh dismissed plaintiff Scotty Mahlum’s claim that the early termination fee payable under Adobe’s Creative Cloud subscription agreement is an amount of liquidated damages, and, as such, prohibited under California Civil Code § 1671(d). According to the Adobe agreement, upon early termination, customers are required to pay 50% of the remaining subscription fees. A liquidated damage payment is defined under California law as an amount of co
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