Court Strikes Down FTC Click-to-Cancel Rule

A U.S. federal appeals court has vacated the FTC's 'click-to-cancel' rule, which was set to take effect on July 14, 2025, citing the agency's failure to conduct a required regulatory analysis and allow sufficient industry comment on alternatives. The rule aimed to simplify subscription cancellations, require clear disclosures, and obtain consumer consent for renewals, targeting 'negative option marketing.' The decision is considered a win for businesses that rely on subscription models, while consumer advocates see it as a setback that could allow complicated cancellation processes to persist. Some states, including Maine and New York, have enacted similar laws to protect consumers at the state level. The court did not endorse deceptive practices but found the FTC's process invalid. Separately, the FTC is pursuing legal actions against companies such as Amazon for allegedly deceptive subscription practices.