Following Court Ruling on Click-to-Cancel, Congress Should Step Up and Protect Consumers, Says Groundwork’s Owens

Following Court Ruling on Click-to-Cancel, Congress Should Step Up and Protect Consumers, Says Groundwork’s Owens

Today, a federal appeals court struck down the Federal Trade Commission’s Click-to-Cancel rule. The rule, which was set to be enforced starting July 14, would have required businesses to make it easy for consumers to cancel a subscription and institute strong protections against misrepresentation and new requirements for informed consent and disclosure.

Groundwork Collaborative’s Executive Director Lindsay Owens released the following statement:

“The Federal Trade Commission’s click-to-cancel rule would have saved consumers time, money, and headaches. Today’s ruling got it wrong, ignoring the overwhelming majority of Americans who support the rule in favor of scammers and corporations who trick consumers into overpaying. This ruling will allow companies to continue to gouge consumers, charging them as much as possible for as long as possible, and require consumers to make phone calls or even in-person visits just to cancel a subscription they purchased with a click or a tap.

“Congress should step up and ban these predatory subscription models that cheat consumers to restore fair pricing in America.“

BACKGROUND

• Polling by Groundwork Collaborative and Data for Progress shows that Americans overwhelmingly oppose practices that make it harder to cancel a subscription or purchase:
  • Over 80% of Americans find it frustrating and nearly 75% of Americans find it unfair when companies make it difficult to get refunds or rebates when companies mess up, including processes to cancel a subscription or purchase.
  • In a typical month, 60% of Americans experience difficulties getting refunds or rebates when companies mess up, including processes to cancel a subscription or purchase.
  • Nearly 70% of Americans believe Congress should address unfair and frustrating business practices like increasing amounts of paperwork because it would improve the daily lives of Americans.
• Groundwork’s collaboration with The American Prospect for an issue on “How Pricing Really Works” dove into subscription pricing in “The One-Click Economy,” which highlights the FTC’s “click-to-cancel” rulemaking.