Claim Form Deadline: Ongoing
Estimated Payout: Varies
FTC Sues Amazon Over Misleading Prime Subscription Practices
The Federal Trade Commission (FTC) has filed a comprehensive 159-page complaint against Amazon.com, Inc. (“Amazon”), alleging violations of the FTC Act and the Restore Online Shoppers’ Confidence Act (ROSCA). The FTC claims that Amazon has breached multiple consumer protection laws, including deceptive practices under ROSCA.
Amazon Prime is a widely used subscription service offering shopping, entertainment, and convenience. It typically includes benefits like free two-day shipping, access to streaming services such as Prime Video and Amazon Music, and grocery delivery through Amazon Fresh and Whole Foods. The service has around 167 million subscribers in the U.S., providing significant value for its annual fee of $139 or $14.99 monthly, with discounted options available for students and low-income customers. A six-month free trial and a 50% discount after the trial are also offered.
The FTC’s complaint centers on allegations that Amazon used manipulative tactics to enroll consumers in Prime without their consent. It claims that Amazon implemented deceptive user-interface designs—often called “dark patterns”—to mislead consumers into signing up for automatically renewing subscriptions.
Internal documents reportedly show that Amazon was aware of issues related to nonconsensual enrollments. Despite discussions within the company urging changes, leadership allegedly resisted modifying the user experience, prioritizing financial interests over consumer rights.
The complaint also highlights Amazon’s complicated cancellation process, dubbed the “Iliad Flow,” which is said to hinder subscribers’ attempts to cancel their memberships, thereby retaining them as Prime subscribers.
Additionally, the FTC scrutinized Amazon’s upsell strategies during checkout on both desktop and mobile platforms, noting how the company strategically placed prompts to encourage Prime sign-ups without clear disclosures about terms or pricing.
The FTC has accused Amazon of prioritizing profit over consumer preferences and employing deceptive practices to increase Prime subscription numbers and revenue. The settlement sought by the FTC includes permanent injunctive relief, restitution, civil penalties, and other forms of equitable relief for the alleged violations of consumer protection laws.
As the legal proceedings unfold, significant disagreements between the parties have emerged. The FTC has requested a trial to begin in May 2026, while Amazon proposes a later date in December 2026, citing the extensive amount of evidence involved, estimated at over 100 terabytes.
The core disagreement lies in contrasting viewpoints: the FTC argues that Amazon’s practices harm consumers, while Amazon contends that its strategies benefit them by lowering prices. Procedural disputes include the FTC’s desire to depose over 100 Amazon witnesses, opposed by Amazon’s request to limit this to 10. Amazon has also denied allegations of document destruction and asserts that its business practices are standard in the retail industry, a claim the FTC disputes.
The FTC aims to compel Amazon to cease the scrutinized practices, which, if successful, could result in regulatory changes and potential damages or penalties paid directly to consumers or states through a class action settlement.
In a related context, the FTC previously sued Meta Platforms over privacy concerns, leading to a record-breaking $5 billion settlement, the largest ever imposed on a company for consumer privacy violations. This case set a significant precedent for privacy enforcement actions.