On July 8, 2025, the United States Court
of Appeals for the Eighth Circuit vacated the Federal Trade Commission’s
("FTC") Click-to-Cancel Rule, which threatened to broadly impact
businesses by requiring specific disclosures and simple cancellation methods
for negative option marketing, auto-renewal plans, and free trial offers.
Had Click-to-Cancel
Rule gone into effect, the rule would have imposed three
core requirements on businesses:
- Transparent Disclosure: Businesses would have been required to
disclose a comprehensive list of material terms immediately adjacent to
the point where a customer would consent to the terms, prior to the
collection of payment information.
- Proof of Consent: Companies would need to retain verifiable
proof of consumer consent to these terms.
- Simple Cancellation: Businesses would be mandated to provide a
simple method of cancellation, designed to be as easy to use as the
enrollment process.
The
Eighth Circuit vacated the rule, finding that the FTC failed to follow its own
internal rulemaking procedures by not preparing the required preliminary
analysis despite the rule's substantial economic impact.