Amazon Settles $2.5 Billion Lawsuit Over Prime Subscription Practices
If you have ever felt misled into subscribing to Amazon Prime or struggled to cancel it, you are not alone. The Federal Trade Commission (FTC) agrees that the subscription process has been confusing and difficult.
In 2023, the FTC filed a lawsuit against Amazon, resulting in a $2.5 billion settlement—one of the largest of its kind. The settlement allocates $1.5 billion to repay eligible subscribers, while the remaining $1 billion serves as a civil penalty.
Changes Required by the Settlement
- Amazon must provide a clear and conspicuous option to decline Prime during checkout.
- The cancellation process must be simplified to make it easier for subscribers to end their membership.
"Amazon and our executives have always followed the law, and this settlement allows us to move forward and focus on innovating for customers," said Mark Blafkin, Amazon senior manager. "We work incredibly hard to make it clear and simple for customers to both sign up or cancel their Prime membership, and to offer substantial value for our many millions of loyal Prime members around the world."
FTC’s Accusations
The FTC accused Amazon of using so-called "dark patterns"—design tricks that push consumers towards subscribing to Prime and then make canceling difficult.
This settlement aims to hold Amazon accountable and ensure more transparency and fairness in how Prime subscriptions are offered and managed.
Summary
This settlement compels Amazon to be more transparent about Prime subscriptions while reimbursing millions who faced confusing sign-ups and cancellations.
Author's note: Amazon's $2.5 billion settlement highlights the importance of protecting consumers from deceptive subscription practices while pushing for clearer user options.