Amazon will stand trial beginning this week over allegations that the company made people pay for subscriptions that are difficult to cancel. The Federal Trade Commission (FTC) claims the company has duped nearly 40 million customers, in violation of consumer-protection laws. It is seeking civil penalties, refunds to consumers and a court order prohibiting Amazon from using subscription practices that could confuse or deceive customers. The trial will take place in a Seattle courtroom.
Amazon Prime is the largest subscription program in the world, and has at least 200 million users. Launched in 2005, it offers free and fast shipping, access to Amazon’s streaming service and other perks. It currently costs $139 annually, or $14.99 monthly.
The FTC, which sued Amazon in 2023, alleges the company tricks people into signing up for their service without their knowledge or consent, including by obscuring details. Amazon denies these allegations, saying it has always been transparent about Prime’s terms.
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“The bottom line is that neither Amazon nor the individual defendants did anything wrong—we remain confident that the facts will show these executives acted properly and we always put customers first,” an Amazon spokesperson said.
The FTC already won a pretrial victory last week, with a judge ruling that Amazon did violate consumer-protection laws by taking Prime members’ billing information before disclosing the terms of the membership. The jurors said that it would also have to consider whether Amazon customers gave their consent to enroll, and if there is a simple mechanism for cancellation.
This lawsuit is part of FTC’s recent efforts to tackle “dark patterns” or digital traps intended to manipulate consumer behavior. According to Prentiss Cox, law professor at the University of Minnesota, these tactics are pervasive in the world of online shopping. “If their practices are held to violate the law, everyone will pay attention,” Cox said. “This is an area in which consumers are outraged across the spectrum and that’s why there’s been so much legislative and regulatory activity.”
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FTC had brought similar charges against LA Fitness and Uber as well, and also investigated the subscription practices of cosmetics companies, newspapers, and phone and internet service providers.
The commission had adopted a federal rule under the Biden administration, intended to make it easy to cancel a subscription. However, this rule was vacated by a federal appeals court earlier this year, after industry groups sued.
The FTC is separately pursuing an antitrust lawsuit against Amazon that accuses the company of engaging in illegal monopolization to maintain position in the online marketplace. Amazon denies the allegations, and a trial is set for 2027. Other major companies like Meta and Google have also been through similar lawsuits recently.