FTC's click-to-cancel rule has been struck down by federal judges at the eleventh hour
The "click to cancel" rule, which was officially named the Negative Option Rule, drew appeals from industry associations and individual businesses. These parties argued the FTC had failed to follow correct procedures and conduct an analysis before issuing the rule. The judge panel has agreed with them.
"While we certainly do not endorse the use of unfair and deceptive practices in negative option marketing, the procedural deficiencies of the Commission's rulemaking process are fatal here," the ruling reads. "Vacatur of the entire Rule is appropriate in this case because of the prejudice suffered by Petitioners as a result of the Commission's procedural error."
The judges may not endorse those actions, but it looks like for the foreseeable future, businesses will be able to keep taking them without consequences.
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Yahoo
10 hours ago
- Yahoo
Serial spyware founder Scott Zuckerman wants the FTC to unban him from the surveillance industry
The founder of a spyware company who was banned from the surveillance industry following an earlier data breach is now seeking to undo the ban, according to the Federal Trade Commission. In a notice on Friday, the federal watchdog said Scott Zuckerman sought to rescind or modify the 2021 ban imposed by the FTC on his company Support King and its subsidiaries. The ban included a provision requiring Zuckerman to maintain certain cybersecurity practices and undergo frequent audits for any of his businesses, after his spyware subsidiary SpyFone in 2018 spilled thousands of people's private phone data, including photos, messages, and location data, to the public web. The FTC's then five commissioners unanimously voted to ban Zuckerman and Support King from offering, selling, or promoting any phone-monitoring app, preventing him from operating in the surveillance industry. Zuckerman now claims the order imposed an 'unnecessary burden' because the financial costs needed to comply with the order made it more difficult for him to expand his other businesses. The review of Zuckerman's petition is expected to be closely watched by privacy advocates and critics of the surveillance industry and could signal one of the first major cybersecurity tests for the Republican-controlled federal agency. If the agency moves to modify the order or vacate it entirely, it would pave the way for a surveillance vendor with a history of data breaches to legally operate again unimpeded. Despite the ban taking effect in 2021, Zuckerman was caught involved in another spyware operation less than a year later. In 2022, TechCrunch received a cache of breached data from the servers of a phone spyware app called SpyTrac, which revealed it was being run by a group of freelance developers with direct ties to Support King, likely to skirt the FTC's ban. The breached data also contained records from SpyFone, despite the FTC's order requiring the company to delete the data it illegally obtained from victims' phones. SpyTrac went offline soon after we contacted Zuckerman for comment. Zuckerman's petition is already facing criticism from the security community. 'I think this petition should be opposed loudly and vigorously. Mr. Zuckerman has repeatedly shown himself to be a bad actor, flouting the FTC by continuing to run his stalkerware company even after the ban was issued,' Eva Galperin, the director of cybersecurity at the Electronic Frontier Foundation, told TechCrunch. 'There is no doubt that both the ban and the continued reporting requirements are personally burdensome to him, but I would argue that that is the point,' said Galperin. 'I have no doubt that Mr. Zuckerman would start up another stalkerware company the minute he thought he could get away with it.' It's not clear how the FTC will vote on Zuckerman's petition, nor did the agency set a date. A spokesperson for the FTC did not comment when reached by TechCrunch. The FTC is required by law to seek comments on petitions to undo the agency's orders. The public can leave feedback on Zuckerman's petition until August 19. The FTC is chaired by Trump-appointed Andrew Ferguson, who serves alongside two other Republicans, Mark Meador and Melissa Holyoak. Democratic commissioner Rebecca Kelly Slaughter was reappointed to the FTC last week after the Trump administration attempted to fire her. The remaining fifth commissioner seat remains vacant. In his petition, Zuckerman appealed to Ferguson directly and the commission's 'current enforcement philosophy,' which Zuckerman told TechCrunch was about 'making sure regulations actually provide a positive impact for consumers and the public.' Galperin, meanwhile, said it was important to maintain the reporting requirements on Zuckerman's future ventures if they are 'in any way connected to the internet because he has repeatedly demonstrated that he cannot secure sensitive user data.' Sign in to access your portfolio
TechCrunch
11 hours ago
- TechCrunch
Serial spyware founder Scott Zuckerman wants the FTC to unban him from the surveillance industry
The founder of a spyware company who was banned from the surveillance industry following an earlier data breach is now seeking to undo the ban, according to the Federal Trade Commission. In a notice on Friday, the federal watchdog said Scott Zuckerman sought to rescind or modify the 2021 ban imposed by the FTC on his company Support King and its subsidiaries. The ban included a provision requiring Zuckerman to maintain certain cybersecurity practices and undergo frequent audits for any of his businesses, after his spyware subsidiary SpyFone in 2018 spilled thousands of people's private phone data, including photos, messages, and location data, to the public web. The FTC's then-five commissioners unanimously voted to ban Zuckerman and Support King from offering, selling, or promoting any phone monitoring app, preventing him from operating in the surveillance industry. Zuckerman now claims the order imposed an 'unnecessary burden' because the financial costs needed to comply with the order made it more difficult for him to expand his other businesses. The review of Zuckerman's petition is expected to be closely watched by privacy advocates and critics of the surveillance industry, and could signal one of the first major cybersecurity tests for the Republican-controlled federal agency. If the agency moves to modify the order or vacate it entirely, it would pave the way for a surveillance vendor with a history of data breaches to legally operate again unimpeded. Despite the ban taking effect in 2021, Zuckerman was caught involved in another spyware operation less than a year later. In 2022, TechCrunch received a cache of breached data from the servers of a phone spyware app called SpyTrac, which revealed it was being run by a group of freelance developers with direct ties to Support King, likely to skirt the FTC's ban. The breached data also contained records from SpyFone, despite the FTC's order requiring the company to delete the data it illegally obtained from victims' phones. SpyTrac went offline soon after we contacted Zuckerman for comment. Zuckerman's petition is already facing criticism from the security community. 'I think this petition should be opposed loudly and vigorously. Mr. Zuckerman has repeatedly shown himself to be a bad actor, flouting the FTC by continuing to run his stalkerware company even after the ban was issued,' Eva Galperin, the director of cybersecurity at the Electronic Frontier Foundation, told TechCrunch. 'There is no doubt that both the ban and the continued reporting requirements are personally burdensome to him, but I would argue that that is the point,' said Galperin. 'I have no doubt that Mr. Zuckerman would start up another stalkerware company the minute he thought he could get away with it.' It's not clear how the FTC will vote on Zuckerman's petition, nor did the agency set a date. A spokesperson for the FTC did not comment when reached by TechCrunch. The FTC is required by law to seek comments on petitions to undo the agency's orders. The public can leave feedback on Zuckerman's petition until August 19. The FTC, chaired by Trump-appointed Andrew Ferguson, serves alongside two other Republicans, Mark Meador and Melissa Holyoak. Democratic commissioner Rebecca Kelly Slaughter was reappointed to the FTC last week after the Trump administration attempted to fire her. The remaining fifth commissioner seat remains vacant. In his petition, Zuckerman appealed to Ferguson directly and the commission's 'current enforcement philosophy,' which Zuckerman told TechCrunch was about 'making sure regulations actually provide a positive impact for consumers and the public.' Galperin, meanwhile, said it was important to maintain the reporting requirements on Zuckerman's future ventures if they are 'in any way connected to the internet because he has repeatedly demonstrated that he cannot secure sensitive user data.'
Yahoo
a day ago
- Yahoo
Long-term triple lock commitment ‘out of scope' of pensions commission
A long-term commitment to the triple lock on pensions is not in the scope of the resurrected Pensions Commission, Liz Kendall has said. The Work and Pensions Secretary has announced that she is reviving the commission, which last met in 2006, to tackle the issue of working age adults failing to put enough money into their retirement savings. Experts have warned that people looking to retire in 2050 are on course to receive £800 per year less than current pensioners. The commission is expected to provide recommendations for how to boost retirement income in 2027. Ms Kendall also confirmed that the next statutory Government review into when and how to raise the state pension age will start work now. 'Unless we act, tomorrow's pensioners will be poorer than today's, because people who are saving aren't saving enough for their retirement,' she said during a speech launching the commission. Lowering the age and earnings threshold at which people are brought into auto-enrolment and as well as looking at easy-access 'sidecar' savings accounts will be among the options the commission looks into. Ms Kendall was asked if she thought it was impossible to maintain the triple lock guarantee given its cost and if she could guarantee it would be in Labour's next manifesto. She said: 'The triple lock is out of scope of the commission. We've got a very clear commitment to that for the entirety of this Parliament. 'And what we're asking the commission to do is genuinely look medium to longer term, the middle of this century, and how the state pension and second pensions work together.' The Office for Budget Responsibility recently said that the triple lock has already cost three times more than initially expected and suggested it was unaffordable in the long term. Ms Kendall was also asked about the potential hit to small businesses from increased automatic enrolment costs. 'I want our small businesses to be successful, but it is also the case, you know, flag forward to the middle of the century, 2050, if we don't act, the amount of pensioner poverty we face will cost everybody if we don't act,' she said. She said she was 'under no illusions about how difficult this will be'. The Department for Work and Pensions (DWP) said 45% of working-age adults were putting nothing into their pensions. The previous pensions commission recommended automatically enrolling people in workplace pensions, which has seen the number of eligible employees saving rise from 55% in 2012 to 88%. DWP analysis suggested 15 million people were under-saving for retirement, with the self-employed, low-paid and some ethnic minorities particularly affected. Around three million self-employed people are said to be saving nothing for their retirement, while only a quarter of people on low pay in the private sector and the same proportion from Pakistani or Bangladeshi backgrounds are saving. Women face a significant gender pensions gap, with those approaching retirement in line to receive barely half the income that men can expect.
