Oct 23 (Reuters) - An industry group representing cable
and internet providers sued along with two others on Wednesday
to block a U.S. Federal Trade Commission rule that requires
companies to offer simple cancellation mechanisms for
subscriptions.
NCTA - The Internet & Television Association and groups
representing the home security and online advertising industries
said in papers filed with the 5th U.S. Circuit Court of Appeals
in New Orleans that the rule known as "click to cancel"
oversteps the FTC's authority and was not supported by evidence.
A spokesperson for the FTC declined to comment.
The FTC finalized the rule on Oct. 16 after considering
thousands of comments from individuals, industry groups and
consumer advocates.
The Electronic Security Association, Interactive Advertising
Bureau, and NCTA had filed comments criticizing the rule as
overly broad.
NCTA represents major cable and internet providers including
Charter Communications ( CHTR ), Comcast Corp ( CMCSA ), and Cox
Communications, as well as media companies such as
Disney Entertainment and Warner Bros. Discovery ( WBD ).
The rule requires businesses to get consumers' consent for
subscriptions, auto-renewals and free trials that convert to
paid memberships. The cancellation method must be "at least as
easy to use" as the sign up process.
It also prohibits requiring consumers who signed up through
an app or a website to go through a chatbot or agent to cancel.
For in-person signups, companies must provide means to cancel by
phone or online.
The 5th Circuit is a popular venue for business groups to
challenge agency actions. Twelve of the 5th Circuit's 17 active
judges were appointed by a Republican president, including six
by former President Donald Trump.