Automatically renewed subscriptions and continuity plans are two of the most common forms of marketing programs generally known as negative options. These programs have come under heavy scrutiny by the Federal Trade Commission (FTC) as well as various states in recent years. In March 2023 the FTC issued proposed major amendments to the existing Negative Option Rule; we are expecting to see the final rule published this year. We are also continuing to see a lot of enforcement actions and litigation based on the existing automatic renewal laws at the state level, and more states appear to be poised to pass their own automatic renewal laws.

In this episode of Perfect Balance: An Advertising Law Podcast, host Po Yi is joined by Manatt partners J.J. Rodriguez and Eric Gold, to discuss how this more expansive negative option rule proposed by the FTC and the current and proposed state automatic renewal laws may change the way companies offer subscription and continuity products.

Additional Resources

Manatt Practice Pages

• Advertising, Marketing and Media
• Consumer Protection
• Federal Trade Commission (FTC)

Articles

• Massachusetts AG Proposes Rule Regulating “Junk Fees” and Subscriptions
• Automatic Renewal Laws: Everything to Know About the Surge in Litigation and Regulatory Enforcement
• Sellers Beware: FTC Proposes Changes to Automatic Renewal Laws
• Episode 16: Recent Developments in State Automatic Renewal Laws and Compliance and Enforcement for Marketers
• Renewing Compliance With Automatic Renewal Laws
• New York Joins California and Other States With a New Consumer-Friendly Automatic Renewal Law
• FTC Considers Updating Regs for Negative Option Marketing
• Twice the Work? Vermont Adopts New Auto Renewal Law