Chegg (CHGG) has agreed to settle US Federal Trade Commission allegations that the company made it difficult to cancel subscriptions, a company spokesperson confirmed to MT Newswires Monday.

The company agreed to pay $7.5 million to resolve the allegations, Reuters reported earlier Monday, citing a court filing.

"While we disagree with the FTC's claims, our decision to settle was made to protect the best interest of students," a Chegg spokesperson said in an emailed statement. "By putting this behind us, we can avoid prolonged litigation and remain focused on what matters most: student success."

The FTC alleged that Chegg hid cancellation options behind multiple website menus and that the staff knew the process was difficult and confusing, citing internal emails including a 2021 message from Chief Executive Nathan Schultz stating there "should be some pain involved" in cancellation, according to Reuters.

Shares of the company fell 5.8% in recent Monday trading.

Price: 1.45, Change: -0.09, Percent Change: -5.84