Click-to-Cancel's End Won't Stymie Subscription Renewal Scrutiny

Consumer protection attorney Brian Goodrich spoke with Bloomberg Law about a federal appellate court ruling striking down the Federal Trade Commission's (FTC) Click-to-Cancel Rule and the implications for federal consumer protection enforcement efforts. The rule, set to take effect on July 14, 2025, would have required businesses offering auto-renewing subscriptions to make those subscriptions as easy to cancel as they are to sign up for. The U.S. Court of Appeals for the Eighth Circuit found the FTC failed to perform a required preliminary analysis for rules whose cost of implementation is estimated to exceed $100 million; though the agency initially said the cost would fall below that threshold, an administrative law judge determined otherwise, and thus the commission was obligated to carry out the analysis.

Mr. Goodrich commented that the Eighth Circuit's decision, though a strictly procedural ruling, "leaves the space very hazy and nebulous instead of there being clear rules of the road" with regard to online subscriptions. However, he said, the FTC still has options in its enforcement toolbelt, such as the authority to go after unfair or deceptive acts or practices under Section 5 of the FTC Act. Moreover, the agency was already filing enforcement actions regarding allegedly unfair subscription practices, most notably a case against Uber. As the case's effects continue to play out, Mr. Goodrich recommended that companies look to the click-to-cancel rule as a guide to creating auto-renewal features that maximize compliance and minimize litigation risks.

READ: Click-to-Cancel's End Won't Stymie Subscription Renewal Scrutiny (Subscription required)