FTC’s “Click-to-Cancel” Rule Gets New Life As FTC’s Enforcement Wave Continues to Target Negative-Option Sellers

The Federal Trade Commission (FTC) is increasingly directing both its enforcement and rulemaking efforts toward auto-renewal programs, with a particular focus on burdensome or opaque cancellation procedures. In ongoing litigation against Uber, the FTC recently upped the ante, adding a civil penalty claim and 21 state co-plaintiffs to its complaint that alleges, in part, that its UberOne membership is too hard to cancel. This step follows FTC actions against the operator of the LA Fitness chain and an education tech provider, each of which highlights the agency’s view that difficulty in canceling a recurring subscription can violate federal consumer protection law and expose companies to monetary liability. This trend is consistent with the FTC’s recent settlement with Amazon regarding its Prime membership enrollment and cancellation processes, summarized in Goodwin’s September 2025 blog post.

At the same time, the FTC has restarted its negative option rulemaking by submitting an Advance Notice of Proposed Rulemaking (ANPRM) to the Office of Information and Regulatory Affairs (OIRA) on January 30, 2026 — a move that signals renewed attention to potential regulatory approaches addressing subscription and automatic renewal practices. This development follows the US Court of Appeals for the Eighth Circuit’s July 2025 decision vacating the FTC’s previously adopted Negative Option Rule and underscores that negative options will continue to be a theme for this Commission, with enforcement ongoing while the agency considers new approaches to strengthen and extend consumer protections and paths to redress across the marketplace.

These developments reinforce that companies offering recurring-billing services must reassess user flows, disclosure practices, and cancellation mechanisms now, even while the FTC’s proposed “negative option rule” remains in flux.

ROSCA and the Negative-Option Framework

A negative option is an offer in which the seller treats a consumer’s silence (i.e., their failure to reject an offer or cancel an agreement) as consent to be charged for goods or services. The Restore Online Shoppers’ Confidence Act (ROSCA) prohibits sellers using internet-based negative-option features from charging a consumers unless three conditions are met: (1) clear and conspicuous disclosure of all material terms before collecting billing information; (2) the consumer’s express informed consent before applying any charges; and (3) a simple mechanism to stop future recurring charges. The FTC has interpreted these provisions to cover automatic renewals, free-to-pay or fee‐to‐pay conversions, and other subscription models where inaction triggers a charge. The agency has also emphasized that the cancellation pathway must be at least as easy as the sign-up method and offered via the same medium (e.g., if enrollment is online, cancellation should also be available online). Because a violation of ROSCA constitutes a violation of an FTC rule under the FTC Act, the FTC may seek — and courts may impose — consumer redress and civil penalties.

Recent Enforcement Highlights 

• FTC v. Uber Technologies, Inc. (complaint filed April 21, 2025 and amended December 15, 2025): The amended complaint, brought by the FTC, 21 states, and the District of Columbia, alleges that Uber enrolled more than 28 million consumers in its paid Uber One subscription. The amended complaint alleges that Uber misrepresented subscription benefits and consumers’ ability to “cancel anytime”; enrolled consumers without first obtaining express informed consent (including through a “Try for free” button and in some cases entirely without the consumers’ knowledge); and then charged consumers before the end of a free trial period. In addition, the amended complaint alleges that Uber makes cancellation of Uber One extremely difficult, requiring consumers to navigate as many as 23 screens and take as many as 32 actions to cancel. The amended complaint seeks civil penalties as well as monetary relief for consumers.
• FTC vs. Fitness International, LLC (August 20, 2025): The FTC’s complaint alleges that Fitness International and Fitness & Sports Clubs imposed burdensome cancellation procedures for gym memberships and add-on plans. The FTC alleges that although consumers can easily enroll online or in the club, consumers can cancel only by navigating complex, poorly disclosed cancellation paths by either: (1) visiting a gym in person during limited weekday hours to present a printed cancellation form to a specific “Operations Manager” or (2) mailing in the same form by certified or registered mail at the consumer’s expense. The complaint further alleges that cancellation forms are only available via a website login (not the widely company-promoted mobile app), that consumers often could not reach the Operations Manager during supposed cancellation hours, and that mailed forms were frequently ignored or not processed, resulting in continued consumer billing. The FTC also alleges that defendants failed to clearly disclose that various “add-on” services (e.g., towel service, childcare) were separate negative-option programs with different, sometimes easier, cancellation paths and that staff were trained to reject cancellation attempts made via phone or email, even when consumers had already tried to cancel through the prescribed procedures. According to the FTC, these “unreasonable cancellation practices” amount to unfair acts or practices under Section 5 of the FTC Act and violations of Section 4 of ROSCA’s requirements to clearly disclose material terms and to provide a “simple mechanism” to stop recurring charges. The complaint seeks monetary relief for the alleged ROSCA violations. 
• FTC vs. Chegg, Inc. (September 15, 2025 complaint and settlement): In its complaint and resulting settlement providing $7.5 million in consumer redress, the FTC alleged that Chegg violated ROSCA and Section 5 of the FTC Act by failing to provide a simple cancellation mechanism for its auto-renewing subscription services. According to the complaint, which sought monetary relief for the purported ROSCA violation, Chegg buried cancellation options within account menus and required subscribers to navigate lengthy, multi-step flows involving promotional offers, default “pause” settings, mandatory surveys, and multiple screens where consumers could easily abandon cancellation by clicking more prominent “keep subscription” or “pause” buttons. The FTC further alleged that, until early 2023, mobile users were required to switch to a desktop computer to cancel, that certain services could not be cancelled from mobile devices at all, and that cancellation attempts often required additional log-ins, navigation between multiple domains, and scrolling or locating low-visibility hyperlinks to complete the process. The complaint also alleged that Chegg continued charging consumers even after they attempted to cancel, leading to nearly 200,000 instances of post-cancellation billing since 2020, and that customer service cancellations similarly failed to stop charges in many cases. According to the FTC, internal company communications reflect executive awareness of complaints about buried and multi-step cancellation pathways, pre-selected “pause” options, and continued billing after attempted cancellations, and they allege that Chegg added further friction, such as surveys, discount offers, and feature-loss reminders, to reduce churn.

Key Takeaways: 

From these enforcement efforts, several themes emerge that should guide companies offering recurring-billing or membership models:

1. The regulatory regime is evolving, but enforcement continues. Although the Eighth Circuit vacated the FTC’s proposed Negative Option Rule in July 2025, the FTC retains its authority under ROSCA and the FTC Act to challenge cancellation practices. State automatic renewal laws (ARLs) meanwhile remain enforceable and may impose comparable or more prescriptive requirements.
2. Cancellation friction is a regulatory risk. If a company’s cancellation pathway is significantly more difficult than its enrollment path, the FTC may view that imbalance as inherently unfair. If a company misrepresented a subscription as easy to cancel, the FTC may view that conduct as deceptive as well.
3. Internal awareness and remediation practices remain relevant. While knowledge is not an element of an unfairness, deception, or ROSCA violation, the FTC frequently relies on internal complaints, consumer metrics, and delayed or ineffective remediation to contextualize the challenged conduct, assess its scope and duration, and support allegations of consumer harm.
4. Disclosures and user interface design matter. Enrollment practices remain a focus, particularly clear disclosures and express consent, as illustrated by the FTC’s recent action against Instacart. In that matter, the FTC alleged that the upsell screen failed to clearly inform consumers that they would be enrolled in a paid Instacart+ membership and charged once the free trial ended. According to the complaint, any indication of future charges was typically relegated to small-print disclosures below the call-to-action button, rather than being prominently displayed where consumers were asked to sign up. Similarly, in the Uber matter, the amended complaint alleges that Uber’s cancellation user interface required consumers to navigate numerous screens and complete multiple steps to cancel, underscoring the FTC’s focus on friction-based interface design.
5. Channel parity matters. If enrollment is available online (or via mobile app), cancellation should not be limited to less-accessible methods.

Conclusion

The Uber, LA Fitness and Chegg matters signal that the FTC’s enforcement lens is firmly trained on the cancellation side of subscription and membership models. Whether your business is digital-only, hybrid, or brick-and-mortar, now is the time to evaluate whether your cancellation flows, disclosures, and intake and exit channels align with the FTC’s expectations of transparency and simplicity. 

Failing to undertake this assessment may lead to enforcement risk, including injunctive relief, redress, and possible monetary penalties.