Appeals Court Blocks FTC 'Click to Cancel' Rule, Affecting Subscription Cancellations

FTC's 'Click to Cancel' Rule Explained

• 💡 The FTC proposed a rule to simplify the cancellation of auto-renew subscriptions, aiming to allow consumers to cancel with minimal effort, ideally more than one click but without significant hurdles.
• ❌ A federal appeals court blocked this rule, citing that the FTC did not conduct the necessary cost-benefit analysis before its promulgation.

Current Landscape of Subscription Rules

• 🧩 Currently, there's a patchwork of rules regarding auto-renewals, with some states having specific regulations, but no uniform federal standard.
• ⚖️ Federal and state laws prohibit unfair and deceptive acts and practices in trade, which the FTC uses to pursue companies that make cancellations difficult.

LA Fitness Cancellation Controversy

• 🎯 The FTC is suing LA Fitness, alleging they engaged in unfair and deceptive practices by creating significant roadblocks to canceling memberships.
• 📄 Allegations include requiring members to print a form, log into a website (often difficult for users to recall credentials), and submit the form in person during limited hours.
• 🎭 Ironically, consumers are forced to go to the gym in person to cancel a membership they may no longer be using.

Consumer Options for Cancellation

• 📬 Currently, consumers can attempt to cancel LA Fitness memberships by mail after printing the required form, or by visiting in person.
• ❓ It remains to be seen how the FTC lawsuit will impact these cancellation processes and whether the situation will change for consumers.