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A coalition of industry groups, including the NCTA – The Internet & Television Association, the Electronic Security Association, and the Interactive Advertising Bureau, has filed a lawsuit against the Federal Trade Commission (FTC) to challenge the agency’s new “click to cancel” rule.

The rule, finalized by the FTC on October 16, mandates that companies must provide consumers with a simple and straightforward method to cancel subscriptions, auto-renewals, and free trials that convert to paid memberships. The cancellation process must be at least as easy as the sign-up process.

The industry groups argue that the FTC’s rule oversteps its authority and lacks sufficient evidentiary support. They contend that the rule is overly broad and imposes unnecessary burdens on businesses.

The NCTA, which represents major cable and internet providers such as Charter Communications, Comcast, and Cox Communications, as well as media companies like Disney and Warner Bros. Discovery, is a key player in this legal challenge. The group believes that the rule could have significant implications for the industry and may hinder innovation.

The 5th U.S. Circuit Court of Appeals in New Orleans, where the lawsuit was filed, is known for its conservative leanings. With a majority of its judges appointed by Republican presidents, including several by the former administration, the industry groups may find a sympathetic audience for their arguments.

The outcome of this legal battle will have significant implications for consumer rights and the regulatory landscape for online services and subscription-based businesses. If the court sides with the industry groups, it could weaken the FTC’s ability to protect consumers from deceptive marketing practices and ensure fair competition.