Deceptive negative-option contracts -- where consumers pay monthly for a subscription unless they opt out -- are ballooning, despite regulators' efforts, backers of the FTC's "click-to-cancel" rule told the 8th U.S. Circuit Court of Appeals on Friday. NCTA and others are challenging the rule (see 2411220029). Last week, amicus briefs were filed for both sides in docket 24-3137.

The argument that the FTC can't adopt rules affecting more than one industry -- such as the agency's "click to cancel" rule -- is contrary to statutory text, case law and decades of practice, the FTC told the 8th U.S. Circuit Court of Appeals in a brief Monday (docket 24-3137). NCTA is among the parties challenging the "click to cancel" rule (see 2411220029). In its response brief, the FTC said the statute authorizing its rulemaking includes no multiple-industry restriction, and it has a long history of cross-industry rulemaking. The FTC said click to cancel doesn't bar "negative option" programs where buyers are charged on a recurring basis unless they take steps to cancel. Instead, it adopts measures that prohibit material misrepresentations and requires disclosure of information such as how much and when a consumer will be charged.

The status of the FTC's "click to cancel" rule, which is being challenged by NCTA and others before the 8th U.S. Circuit Court of Appeals (see 2411220029), is unclear under the new presidential administration, Venable wrote this week. New FTC Chairman Andrew Ferguson voted against the rule when it was originally promulgated, and arguments that Commissioner Melissa Holyoak made in her dissent were seemingly echoed in the petitioners' brief before the 8th U.S. Circuit Court of Appeals, according to Venable. President Donald Trump's executive order requiring regulatory agency leaders to assess rules for potential rescission or modification "add[s] to the uncertainty of the rule's future," it said.

Four lawsuits against the FTC’s click-to-cancel rule will be consolidated into a case before the 8th U.S. Circuit Court of Appeals, the Judicial Panel on Multidistrict Litigation (JPML) said Thursday in its consolidation order (see 2411210035 and 2411070025). NCTA, the Interactive Advertising Bureau and the Electronic Security Association filed one of the lawsuits with the 5th U.S. Circuit Court of Appeals. The U.S. Chamber of Commerce and the Georgia Chamber of Commerce filed a suit with the 11th U.S. Circuit Court of Appeals. The National Federation of Independent Business and the Michigan Press Association filed a lawsuit with the 6th U.S. Circuit Court of Appeals. Custom Alarm filed a lawsuit with the 8th Circuit. The 8th Circuit was “randomly selected” for the consolidation, the JPML said.

The FTC failed to meet a statutory deadline in response to a request to consolidate various lawsuits against the agency’s click-to-cancel rule, the 5th U.S. Circuit Court of Appeals said in a filing Tuesday (see 2411070025). NCTA, the Interactive Advertising Bureau and the Electronic Security Association earlier this month filed a mandamus petition with the 5th Circuit. The organizations filed one of four lawsuits against the new agency rule, which groups are seeking to consolidate within one federal court. The groups’ petition said the agency failed to forward the request for consolidation to the Judicial Panel on Multidistrict Litigation within a 10-day window of the rule’s issuance. The 5th Circuit agreed Tuesday, dismissing the agency’s argument that the 10-day window begins when the rule is published in the Federal Register, not when the rule was publicly announced, on Oct. 16. The agency failed to cite authority establishing that timeline, and the court hasn’t found legal justification, the filing said. The court granted the mandamus, forcing the agency to forward the complaints to the JPML. The court denied the groups’ request for an administrative stay, saying placing a hold on the rule is unnecessary because it’s not yet in effect. The associations have argued they’re incurring compliance costs in preparation for the rule.

The FTC is breaking the law by refusing to follow statutory mandates that would allow consolidation of lawsuits against the agency’s new click-to-cancel rule, said NCTA, the Interactive Advertising Bureau and the Electronic Security Association in a filing this week (see 2410240001).

The FTC violated the Constitution and exceeded its rulemaking authority when it issued a rule aimed at making it easier for consumers to cancel subscriptions, the U.S. Chamber of Commerce, NCTA, the Interactive Advertising Bureau and other industry groups said in three different lawsuits filed Tuesday in three separate appeals courts.