Court Cancels Consumer-Friendly Click-to-Cancel Rule
Last updated July 30, 2025
A federal appeals court has blocked enforcement of a Federal Trade Commission (FTC) rule that prohibited companies from “making it any more difficult for consumers to cancel than it was to sign up” for unwanted subscriptions, memberships, and auto-renewals.
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The U.S. Court of Appeals in St. Louis vacated the click-to-cancel rule just days before the July 14 enforcement date, deciding that the FTC had not followed proper procedure, as alleged by several business groups—an assertion the FTC rejected previously. The court’s ruling noted that it did not “endorse the use of unfair and deceptive practices in negative option marketing.”
The FTC has not commented on the ruling; a spokesperson told Checkbook the commission is considering its options. But because the commission is now chaired by a Republican who voted against the rule last year, it’s unlikely the FTC will appeal the court’s ruling. The second Trump administration, in general, has not supported new rules aimed at improving consumer protections.
Erin Witte, director of consumer protection at the Consumer Federation of America, who strongly supported the rule, shared her reaction on X:
“Apparently hearing from 16,000 actual people about their subscription traps was NOT sufficient, because the corporations who profit from subscription traps didn’t get enough chances to say how much they didn’t want to stop subscription trapping. Airtight American logic.”
What the Rule Would Have Done
Subscription programs are available for everything from streaming services and gym memberships to automatic shipments of cosmetics and nutritional supplements. They can provide substantial consumer benefits, such as free shipping, discounted prices, convenience, and special offers.
But as Checkbook previously reported, the FTC created the rule after receiving thousands of complaints a year about the tedious and time-consuming roadblocks customers encountered when trying to cancel subscriptions.
The rule required companies to make it as easy to cancel as it was to sign up: the same process and the same number of steps. If it took one click online to subscribe, then it had to be one click to unsubscribe. If a customer signed up on the phone, the company had to allow them to cancel with a phone call.
Companies that offered subscriptions would also be required to “clearly and conspicuously” disclose important information, including the amount of recurring charges and the frequency, the deadline to cancel, and when the initial price might increase.
When the rule took effect in October 2024 (enforcement was delayed until this July to accommodate businesses), consumer advocates felt confident it would make a significant difference in the marketplace.
At the time, Shennan Kavanagh, director of litigation at the nonprofit National Consumer Law Center, said the “common sense” provisions of the rule would ensure consumers were not “unwittingly having money taken straight out of their bank accounts for services or products that they no longer wish to use.”
So, What Now? How Do You Protect Yourself?
“While this is a setback for those who supported the rule, the good news is that many, many companies—particularly those where you can sign up for subscriptions online—have already moved to more transparent policies,” Teresa Murray, consumer watchdog at U.S. PIRG, wrote in a blog post. “They’re not expected to retreat and change their interfaces, at least not in the near term.”
One reason many companies already shifted toward consumer-friendly cancellation policies is that California and New York enacted state laws that provide similar protections to those that would have been required by the FTC’s rule.
But in any state, consumers must be careful when signing up for a subscription or recurring purchases. PIRG suggests:
- Know what you’re agreeing to by reading all the terms and conditions.
- Look for pre-checked boxes that require you to agree to terms or conditions that are not mentioned in the advertising, such as additional charges or ongoing email promotions. Uncheck any boxes you disagree with.
- If you subscribe to something, whether it’s for one month or one year, put the cancellation date on your calendar and create a reminder to cancel ahead of the date so you don’t miss it.
- If you cancel, try to remove credit card information from your account to ensure you won’t be charged for another billing cycle.
When customers attempt to cancel, some companies will offer incentives or a limited-time promotional price to entice them to stay. If you want to continue and can afford the price, it might be worth considering, but don’t let them talk you into something you don’t want. Make a note of the date the promotional deals end, so you can cancel (if you want) before the price goes up.
Beware of Free Trial Offers
“Free trial” offers are especially problematic. In most cases, if you don’t cancel on time, you’ll be charged for that “free” product or service. You could also be automatically enrolled in an ongoing subscription program. Many customers don’t understand this because it’s not disclosed up front or is hidden in fine print.
Canceling a subscription can be difficult at best; impossible if you’ve fallen for a free-trial scam. Because the company has your credit or debit card number, which you provided to cover shipping and handling, they can continue billing you.
Tip: Use a credit card to pay for any subscriptions that bill automatically. Debit cards link to your bank account, making it difficult to get reimbursed for recurring fees charged to a debit card if a company does not honor your cancellation request. Pay with a credit card, and you can challenge those charges directly with your card issuer.
If you’re having problems canceling a subscription or membership program, or were deceived by a free trial offer, complain to the Federal Trade Commission and your state attorney general.
FTC Case Against Amazon Prime Subscriptions Moves Forward
The Court of Appeals ruling does not affect the lawsuit the FTC filed against Amazon in June 2023. As Checkbook reported at the time, the FTC is accusing Amazon of enrolling customers in its Prime program without their consent and making it difficult for them to cancel—a charge Amazon denies.
According to Courthouse News Service, the trial is scheduled to start in late September. Earlier this month, U.S. District Court Judge John Chun admonished Amazon and its counsel that “their conduct during discovery was tantamount to bad faith” after the court found that Amazon “withheld almost 70,000 documents” until the eve of, and after, the April discovery cutoff. “Similar conduct,” the judge wrote, “may lead to more serious sanctions.”
Contributing editor Herb Weisbaum (“The ConsumerMan”) is an Emmy award-winning broadcaster and one of America's top consumer experts. He has been protecting consumers for more than 40 years, having covered the consumer beat for CBS News, The Today Show, and NBCNews.com. You can also find him on Facebook, Blue Sky, X, Instagram, and at ConsumerMan.com.