Industry Groups Sue to Block FTC's "Click to Cancel" Rule

Starfolk

Starfolk

October 23, 2024 · 1 min read
Industry Groups Sue to Block FTC's

In a move that has sparked controversy, three industry groups are taking the Federal Trade Commission (FTC) to court to block its new "Click to Cancel" rule, which aims to make it easier for consumers to cancel subscriptions online. The Internet and Television Association, Electronic Security Association, and Interactive Advertising Bureau argue that the rule is an "abuse of discretion" and would unfairly regulate consumer contracts across all industries.

The rule, set to take effect in 180 days, would require companies to allow customers to cancel subscriptions online if they signed up online, rather than forcing them to use alternative methods like phone calls or in-person visits. This would impact a wide range of businesses, from gym memberships to Amazon Prime and meal delivery services.

The lawsuit has significant implications for the tech and startup community, as it could shape the future of subscription-based business models and consumer protection regulations.

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