Eighth Circuit Court Vacates FTC Click-to-Cancel Rule

The U.S. Court of Appeals for the Eighth Circuit vacated the Federal Trade Commission's (FTC) click-to-cancel rule on July 8, 2025, just days before it was scheduled to take effect on July 14. The regulation, part of the Biden administration's Time is Money initiative, would have required businesses to make canceling recurring subscriptions as simple as the enrollment process and obtain explicit consent before charging for auto-renewals.

The court ruled that the FTC committed a fatal procedural error by failing to conduct a required preliminary regulatory analysis for rules with an annual economic impact exceeding $100 million. While the FTC argued the impact was below this threshold, an administrative law judge ruled otherwise. The court found this omission deprived businesses and industry associations—including the U.S. Chamber of Commerce and the Motion Picture Association—of the opportunity to propose less burdensome alternatives.

Reactions within the FTC were split. Former Chair Lina Khan defended the rulemaking process, while current Chairman Andrew Ferguson and Commissioner Mark Meador criticized the previous leadership for cutting corners. Current FTC leadership has indicated a preference for targeted enforcement over broad rulemaking, making a relaunch of the rule unlikely.

Despite the vacatur, the FTC continues to pursue deceptive subscription practices under the Restore Online Shoppers’ Confidence Act and is preparing for a trial against Amazon.com regarding its Prime program. Additionally, state-level laws in California, New York, and Maine continue to mandate easy cancellation processes.