Cable and internet providers, home security companies, and advertisers are suing the U.S. Federal Trade Commission (FTC) over the proposed rule around canceling subscriptions.
But now, groups representing the home security, cable and internet, and online advertising industries have filed a complaint with the 5th U.S. Circuit Court of Appeals in New Orleans, arguing there’s no merit to the proposed rule. The Internet & Television Association (NCTA), the Electronic Security Association (ESA), and the Interactive Advertising Bureau (IAB) wrote in the filing that the rule is “arbitrary, capricious, and an abuse of discretion.”
These industry groups represent service providers like Comcast, Charter, and Cox, studios such as Disney, AMC, Paramount, and Warner Bros. Discovery, as well as those that advertise like Google, Netflix, Amazon, Meta, Vizio, and the NFL. The filing claims the FTC’s rule amounts to attempts to “regulate consumer contracts.” It is no coincidence that the complaint was filed with the New Orleans appeals court, which is well-known for favoring corporations in such lawsuits.
“The big businesses that deploy deceptive subscription models to trap customers are trying to sue their way out of this regulation to lower costs for millions of consumers,” Liz Zelnick, director for the watchdog group Accountable.US said in a statement. “We’ve seen this movie before, with big industry players venue shopping in a corporate-friendly jurisdiction regardless of the impact on Americans.”
If the rule is passed and becomes law, companies will need to permit people to stop their subscription the same way they signed up for it, with cancelation “at least as easy to use” as the signup process. “Companies shouldn’t be able to trick you into paying for subscriptions that you don’t want,” Commission Chair Lina M. Khan said in a press release.
By moving to sue, these industry groups can delay or even derail the rule. We hope the FTC will prevail, because many subscriptions are absurdly difficult to cancel by design, employing dark patterns to discourage you from unsubscribing.
