Click to Cancel Just Got Cancelled: Eighth Circuit Vacates Entirety of FTC’s Negative Option Rule

On July 8, 2025, the US Court of Appeals for the Eighth Circuit vacated the entirety of the Federal Trade Commission’s new Negative Option Rule – popularly known as the Click-to-Cancel Rule – just days before it was scheduled to take full effect. While the rule has been vacated, the FTC can still police unfair and deceptive subscription practices under existing statutory authority. Companies also must continue to comply with the complex and evolving patchwork of state automatic renewal laws (ARLs), many of which impose prescriptive requirements governing point-of-sale disclosures, collection of affirmative consent to negative option features and design of cancellation mechanisms that overlap with many of the features of the now defunct Click-to-Cancel Rule. Accordingly, companies that were scrambling to complete changes to the designs of their sign-up flows and cancellation mechanisms in anticipation of the rule’s effective date should think twice before abandoning those efforts, and companies that were just starting to come to grips with the rule’s implications should continue to evaluate their compliance posture against the larger framework of federal and state ARLs. Although the Click-to-Cancel Rule appears to be dead for now, many of its key principles and requirements will live on in different forms that create materially similar compliance challenges and legal risks for businesses.

Read more ›