Court Vacates FTC’s Click-to-Cancel Rule
Major cable providers prevail.
WASHINGTON, July 9, 2025 – Federal regulations designed to make it easy to cancel a cable TV bill just got tossed out in court.
On Tuesday, the U.S. Court of Appeals for the Eighth Circuit in St. Louis vacated the Federal Trade Commission’s “click-to-cancel” rule just days before it was set to take effect.
The Court found that the FTC failed to conduct a preliminary regulatory analysis of the rule’s costs and benefits – a required step for rules whose annual impact on the U.S. economy exceeds $100 million.
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“While we certainly do not endorse the use of unfair and deceptive practices in negative option marketing, the procedural deficiencies of the Commission’s rulemaking process are fatal here,” the Court stated. “The Rule does contain a severability provision which keeps the remaining provisions in effect if any provisions are stayed or determined to be invalid. But vacatur of the entire Rule is appropriate in this case because of the prejudice suffered by Petitioners as a result of the Commission’s procedural error.”
The rule, spearheaded by former Democratic FTC Chair Lina Khan in October 2024, was intended to modernize the FTC’s 1973 Negative Option Rule, which addressed unfair subscription practices. Under the new mandate, businesses would be required to make subscription cancellations as simple as sign-ups.
“Too often, businesses make people jump through endless hoops just to cancel a subscription,” Khan said in a statement following the rule’s announcement. “The FTC's rule will end these tricks and traps, saving Americans time and money. Nobody should be stuck paying for a service they no longer want.”
The mandate sparked backlash from the cable industry, including NCTA – The Internet & Television Association – the trade association which represents Charter, Comcast, Cox, Disney, and Warner Bros. These providers argued the “click-to-cancel” rule could increase costs for consumers, especially when cancelling part of a bundled service package rather than the entire bundle.
Although the rule was scheduled to start on May 14, five days before that date, the FTC unanimously voted to postpone implementation by 60 days, stating “the original deferral period insufficiently accounted for the complexity of compliance.”
A request for comment from the FTC by Broadband Breakfast was not answered in time for publication.
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