The Federal Trade Commission (FTC) has filed a lawsuit against Amazon, accusing the company of deceiving customers into signing up for Amazon Prime and making it difficult for them to cancel the subscription. This comes after the recent settlements between Amazon and the FTC over privacy concerns related to Ring doorbells and Alexa for kids.
According to the FTC, Amazon violated the FTC Act and the Restore Online Shoppers’ Confidence Act through misleading design practices that tricked users into registering for Prime without their true consent. The agency also alleges that Amazon intentionally delayed and hindered the investigation into these practices.
FTC chair Lina Khan has stated that Amazon “tricked and trapped” customers, causing them to lose significant amounts of money. The FTC’s investigation into Amazon Prime’s sign-up and cancel systems started in March 2021 but gained more traction in 2022 when internal documents obtained by Insider suggested that Amazon was aware of customer objections as early as 2017. Customers were encouraged to sign up for a 30-day trial with a single click during checkout, but canceling the service before the trial ended required navigating through multiple pages. Amazon even used the term “Iliad” to describe the lengthy cancellation process, referencing the epic poem by Homer.
This lawsuit against Amazon is part of the FTC’s broader scrutiny of the company’s practices. Under Lina Khan’s leadership, the FTC has closely examined Amazon’s acquisitions, such as MGM and One Medical, as well as privacy concerns surrounding Alexa and Ring doorbells. Khan has been a vocal critic of Big Tech even before her appointment as FTC chair, and Amazon had previously requested her recusal in antitrust cases due to alleged bias.
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The use of deceptive design, also known as “dark patterns,” is not a new concept. In 2020, the European Union highlighted how many websites make it unnecessarily difficult for users to reject tracking cookies. However, the lawsuit against Amazon presents a significant test of the legality of such design patterns in the United States.
It is worth noting that this isn’t the first time Amazon has faced scrutiny over its business practices. The company has been criticized in the past for allegedly abusing its dominance in online retail, mistreating warehouse workers, and evading taxes. The ongoing investigations and legal actions against Amazon indicate that regulators are actively monitoring the company’s activities and holding it accountable for any potential violations.
Amazon’s response to the FTC’s lawsuit is yet to be seen. The company has not made any official comments regarding this specific case. However, Amazon is known for its robust legal team and is likely to mount a strong defense in court.
In conclusion, the FTC has taken legal action against Amazon, accusing the company of deceptive practices in signing up customers for Amazon Prime and making it difficult for them to cancel the subscription. This lawsuit adds to the ongoing scrutiny of Amazon’s business practices and raises questions about the legality of dark patterns in the United States. As the case unfolds, it will be interesting to see how Amazon responds and whether this legal action leads to significant changes in the company’s practices.
