What happened
Amazon has settled a lawsuit over allegations it tricked customers into signing up for Prime membership and made it too onerous to end their subscriptions, the Federal Trade Commission announced Thursday. Amazon agreed to pay a $1 billion civil penalty and up to $1.5 billion in refunds to an estimated 35 million affected customers.
Who said what
Amazon relied on “sophisticated subscription traps designed to manipulate consumers into enrolling in Prime,” then “made it exceedingly hard” to cancel, FTC Chair Andrew Ferguson said. An Amazon spokesperson said the e-commerce giant had “always followed the law” and could now “move forward and focus on innovating for customers.” The company did not admit or deny wrongdoing in the settlement.
The “historic” settlement, one of the largest in U.S. history, was a “surprise,” coming days after the case went to trial in federal court in Seattle, The Associated Press said. The fine “rivals some of the large penalties” levied by the European Union’s aggressive privacy and competition regulators, The Washington Post said, but it’s also just a “fraction” of Amazon’s “nearly $60 billion” in profits last year. This is a “drop in the bucket for Amazon,” former FTC Chair Lina Khan, who filed the case in 2023, said on social media. “And, no doubt, a big relief for the executives who knowingly harmed their customers.”
What next?
Amazon has 90 days to automatically refund $51 to customers who signed up between June 2019 and June 2025 through a deceptive sign-up process, then barely used the service or watched Prime Video. Other customers who could qualify will be contacted with directions to apply for refunds.
The Week
Escape your echo chamber. Get the facts behind the news, plus analysis from multiple perspectives.
Sign up for The Week's Free Newsletters
From our morning news briefing to a weekly Good News Newsletter, get the best of The Week delivered directly to your inbox.
From our morning news briefing to a weekly Good News Newsletter, get the best of The Week delivered directly to your inbox.
-
Could U.S. Tomahawk missiles help Ukraine end the war?Today's Big Question Or is Trump bluffing?
-
Political cartoons for October 17Cartoons Friday's editorial cartoons include Tomahawk missile talk, the price of red meat, and the bestest boy reports from the Pentagon press room
-
The ‘swag gap’: are you better than your partner?In The Spotlight The viral terminology sheds light on power dynamics in modern relationships
-
Pentagon reporters turn in badges after refusing rulesSpeed Read They refused to sign a restrictive new press policy imposed by Defense Secretary Pete Hegseth
-
Supreme Court points to gutting Voting Rights Actspeed read States would no longer be required to consider race when drawing congressional maps
-
Trump says he authorized covert CIA ops in VenezuelaSpeed Read He is also considering military strikes inside the country
-
‘Vile, racist’ leaked chats roil Young RepublicansSpeed Read Leaders of Young Republican groups made racist, antisemitic and violent comments in private chats
-
Trump ties $20B Argentina bailout to Milei votesspeed read Trump will boost Argentina’s economy — if the country’s right-wing president wins upcoming elections
-
News organizations reject Pentagon restrictionsSpeed Read The proposed policy is Defense Secretary Pete Hegseth’s latest move to limit press access at the Pentagon
-
Trump declares end to Gaza war, ‘dawn’ of new MideastSpeed Read Hamas freed the final 20 living Israeli hostages and Israel released thousands of Palestinian detainees
-
‘Porsche’s luxury credentials are now hanging by a thread’Instant Opinion Opinion, comment and editorials of the day
