Industry Groups Sue to Block Click-to-Cancel Rule

The rule was to go into effect 180 days after being published in the federal register, but this court case could delay that, if not blocking the rule entirely and sending the FTC back to the drawing board. The lobbying groups are asking the courts to vacate the rule entirely, but it could be reintroduced in a modified version.

The FTC is empowered under 15 U.S. Code § 53 to make rules to regulate unfair and deceptive business practices, which gives them authority to pass rules like the Negative Option rule; however, several landmark court cases in recent years have undermined federal agencies’ ability to regulate the industries under their jurisdiction. As such, it’s not clear what the outcome of the appeal will be.

This means, for now at least, that consumers need to be extremely careful when signing up for new subscriptions, or be proactive in seeking out no-contract options for internet service and software. Be sure to avoid services with outrageous early termination fees, and make sure you know about any other fees or price hikes lurking in the fine print—which is easier for internet plans thanks to the introduction of broadband labels.

Additionally, it’s a good idea to take a look at your monthly expenses and eliminate unwanted services, even if companies make canceling as difficult as possible. In the event that you find yourself truly scammed by a company that refuses to let you cancel, you can contact your credit card company and have them halt payments, though it will generally only do this as a last resort once you’ve tried and failed to cancel your subscription through the normal channels.

Hopefully, we’ll still get some version of the click-to-cancel rule in the future, but for now, I’m not holding my breath.