Amazon is set to face a trial on Monday in a lawsuit filed by the US government, accusing it of deceptively enrolling millions into its Prime subscription and complicating the cancellation process.
The Federal Trade Commission (FTC) filed a complaint in June 2023, alleging that Amazon used manipulative design tactics, known as “dark patterns,” to sign up consumers for its $139-per-year Prime service during the checkout process.
The lawsuit highlights two key issues: Amazon allegedly signed up customers without clear consent using confusing checkout methods and created a complex cancellation system known internally as “Iliad,” a nod to the famously lengthy Trojan War epic by Homer.
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The trial will be held in a Seattle federal court before Judge John Chun, who is also overseeing another FTC case against Amazon, accusing it of maintaining an illegal monopoly, scheduled for trial in 2027.
These cases are part of a series of lawsuits aimed at curbing the power of US tech giants, reflecting a bipartisan push following years of governmental inaction.
According to court documents, Amazon was aware of extensive “nonconsensual enrollment” in Prime but opposed changes that would decrease these unwanted subscriptions due to potential revenue loss.
The FTC claims Amazon’s checkout process led customers through confusing interfaces, with small, hidden links to decline Prime membership, while sign-up options were prominently displayed.
Important details about the Prime membership’s cost and automatic renewal were often obscured or tucked away in fine print, according to the FTC.
The original complaint states, “For years, Amazon has deliberately misled millions of consumers into unknowingly subscribing to its Amazon Prime service.”
Prime has become a crucial part of Amazon’s business model, with subscribers spending much more on the platform compared to non-members.
The lawsuit also challenges Amazon’s cancellation process, describing it as a “labyrinthine” four-page, six-click, fifteen-option ordeal.
The FTC seeks penalties, financial restitution, and permanent court orders requiring Amazon to revise its practices.
The case partially relies on the Restore Online Shoppers’ Confidence Act (ROSCA), enacted in 2010, which bans charging consumers for online services without clear terms, explicit consent, and easy cancellation options.
The FTC claims Amazon breached these standards by not clearly revealing Prime’s terms before collecting payment information and by not getting genuine informed consent before charging customers.
Amazon’s defense will argue that ROSCA and related regulations do not explicitly forbid the practices in question, suggesting the FTC is misapplying the law.
The company also contends that it has improved its Prime sign-up and cancellation processes and that the claims are outdated.
The jury trial is anticipated to last about four weeks, relying heavily on internal Amazon documents, communications, and testimonies from executives and experts.
If the FTC wins, Amazon could face significant fines and be mandated to overhaul its subscription practices under judicial oversight.
