Reuters reported that an industry group representing telecom providers such as Comcast and Charter has filed a lawsuit with the FTC to block the recently ratified “click-to-cancel” rule. NCTA, formerly known as the National Cable and Telecommunications Association, filed suit in the Fifth Circuit Court of Appeals in New Orleans, arguing that the rule exceeds the FTC’s authority.
The Interactive Advertising Bureau, which represents the online advertising industry, and the Electronic Security Association, which represents the home security industry, are also involved in the lawsuit. The group called the FTC’s ruling “arbitrary, capricious and an abuse of discretion.” According to USA Today, the lawsuit also includes language suggesting that jumping through annoying hoops to cancel a subscription may actually be beneficial to consumers. So this little mom and pop industry group is just looking out for us little guys. I truly glow with gratitude.
For news buffs, the venue of the lawsuit may raise some eyebrows. The 5th Circuit Court of Appeals in New Orleans is widely considered the most right-leaning appellate court in the nation, and a favorite place for large corporations and political groups to drop such cases.
The justices temporarily barred the White House, FBI and Surgeon General from urging social media companies to remove posts filled with misinformation. The court also struck down a ban on bump stocks, restricted access to the abortion drug mifepristone, and made it harder to fund the Consumer Financial Protection Bureau (CFPB).
The Fifth Circuit is actually significantly more conservative than SCOTUS, as several of these decisions have been overturned by the Supreme Court. To this end, 12 of the court’s 17 judges were appointed by Republican presidents, six of whom were appointed by former President Trump. NCTA and its industry partners have been accused by consumer advocates of “venue shopping” by choosing a federal appeals court that appears favorable to the case.
“Large companies that have introduced deceptive subscription models to trap customers are seeking to sue to get out of this regulation to lower costs for millions of consumers.” Liz Zelnick, director of the watchdog group Accountable US, said in a statement published in USA Today. . “We’ve seen this movie before, where big industry players shop in business-friendly jurisdictions without regard to the impact on Americans.”
Americans don’t have to worry about being tricked into buying a subscription or membership or staying with either against their will.
My administration is now taking steps to ensure people don’t have to jump through hoops to cancel. https://t.co/3TJFi362vh
— President Biden (@POTUS) October 16, 2024
The FTC approved the “click-to-cancel” rule on October 16th in a vote along party lines. Simply put, this ruling requires providers to make canceling a subscription as easy as signing up for one. Prohibits companies from misrepresenting their subscription services or memberships.
“Too often, companies make people jump through endless hoops just to cancel a subscription,” said chairman Lina Khan. “The FTC’s rules will eradicate these tricks and traps and save Americans time and money. No one should have to pay for services they no longer want.”
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