OAKLAND – As part of a coalition of 26 attorneys general, California Attorney General Rob Bonta today announced that he has filed a comment letter supporting the Federal Trade Commission's (FTC) proposed improvements to its existing Negative Option Rule. “Negative option offers” are a business tactic of interpreting a consumer’s silence — or failure to take affirmative action — as acceptance of an offer, often in the form of a recurring, unwanted subscription that is difficult or impossible to cancel. These deceptive practices have been a source of consumer harm for decades. The FTC’s proposed changes significantly broaden the requirements and risks for businesses using negative option features and will allow consumers to more easily cancel unwanted subscriptions and memberships.
“If consumers want to cancel a subscription, they should not have to go on a fishing expedition,” said Attorney General Bonta. “Just as businesses make it easy to sign up for a subscription, they need to respect customers who later want to end that subscription. Deception and dark patterns have no place in consumer markets, and the proposed Negative Option Rule is the change consumers have been rightly demanding for years. I’m proud to support this effort by the FTC and to offer additional recommendations alongside my fellow attorneys general.”
The FTC announced the proposed updates to its Negative Option Rule on March 23, 2023 and asked for public comment to help inform its decision-making. The coalition of attorneys general is submitting a supportive comment letter in response to that request. The proposed Negative Option Rule would, among other things:
In their letter, the attorneys general express support for the above protections and propose additional clarifications and improvements. The attorneys general urge the FTC to:
California already has in place a negative option statute, which makes it unlawful, in part, for a business to “[f]ail to present the automatic renewal offer terms or continuous service offer terms in a clear and conspicuous manner “ and to “[f]ail to provide an acknowledgment that includes the automatic renewal or continuous service offer terms, cancellation policy, and information regarding how to cancel in a manner that is capable of being retained by the consumer.” The FTC’s proposed amendments to its Negative Option Rule would set clear, enforceable requirements nationwide for all negative-option practices in all media, while still allowing states — like California — to maintain and enact stricter laws in this area.
In sending this comment letter, Attorney General Bonta joins the attorneys general of Alabama, Arizona, Colorado, Connecticut, Delaware, District of Columbia, Hawaii, Illinois, Maine, Maryland, Massachusetts, Michigan, Minnesota, Nebraska, Nevada, New Jersey, New York, North Carolina, North Dakota, Oklahoma, Oregon, Pennsylvania, Vermont, Washington, and Wisconsin.
A copy of the comment letter can be found here.