Connecticut Contemplates Troubling Expansion of Free Trial Law; Louisiana & Tennessee Consider Changes Too
Despite already having a law regulating free trials, in mid-February Connecticut Senate President Donald Williams made legislation expanding the current law a Senate Democrat caucus priority.
The current law requires that for a free trial offer, a notice with terms and conditions must be provided to the customer either before the start of the trial or with the initial delivery of the product. The notice must inform consumers how to cancel the trial offer if they wish to. Under the proposed legislation, this notice would be required to be delivered twice – before the start of the trial and with initial delivery of the product. Further, the notice would need to be provided no less than fifteen days before the start of the trial offer. This would mean a trial offer – including for digital magazines – could not commence for 15 days.
In meetings with Connecticut Senate staff, MPA expressed concern with the legislation as drafted and offered suggestions for how to address the legislator's concerns in a way that is workable for publishers. In addition to MPA, other industries who use free trials and automatic renewals have expressed similar concerns, a positive development that has already resulted in a pending redrafted version of the legislation.
Connecticut is not alone in looking at free trials and automatic renewals this year. Following a trend seen over the last several years, legislation similar to laws passed previously in California and Oregon has been introduced in Tennessee. Like California and Oregon, the Tennessee legislation would impact automatic renewal offers using credit card payments. In such sales, the terms and conditions of the offer would need to be placed in visual proximity to the request for consent, and the consumer would need to receive an acknowledgment of the offer terms in a form capable of being retained. In what seems to be a drafting error, the Tennessee proposal would require the acknowledgement to be sent no less than seven days after completion of the order (as opposed to, for example, immediately upon completion of the order). In Louisiana, automatic renewal legislation has been introduced that would require that a consumer provide written authorization (either a letter or signed contract) before accepting an offer containing an automatic renewal.
Though the proposals in Tennessee and Louisiana have not been given the same legislative priority as the bill in Connecticut, MPA will continue to work with the state legislatures to ensure that our concerns with each bill are addressed.