On Monday, the Federal Trade Commission's lawsuit against Amazon for misleading customers who signed up for Amazon Prime began what was expected to be a lengthy trial. By Thursday, that trial was over as Amazon agreed to a whopping $2.5 billion settlement.
The FTC said $1.5 billion will go into a fund to repay eligible subscribers, with the remaining $1 billion collected as a civil penalty. The settlement requires Amazon to add a "clear and conspicuous" option to decline Prime during checkout and to simplify the cancellation process.
"Amazon and our executives have always followed the law, and this settlement allows us to move forward and focus on innovating for customers," Mark Blafkin, Amazon senior manager, said in a statement. "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."
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The settlement news arrives just as Amazon gears up for its major fall shopping event, Prime Big Deal Days. The online retail giant continues to deny wrongdoing but said the agreement allows it to put the case behind it and prepare for the sale in early October.
Why was the FTC suing Amazon?
The FTC filed suit against Amazon in 2023, accusing it of using "dark patterns" to nudge people into Prime subscriptions and then making it too hard to cancel. The FTC maintained Amazon was in violation of Section 5 of the FTC Act and the Restore Online Shoppers' Confidence Act.
"Specifically, Amazon used manipulative, coercive or deceptive user-interface designs known as 'dark patterns' to trick consumers into enrolling in automatically renewing Prime subscriptions," the FTC complaint states.
Who is eligible for Amazon's big payout?
Amazon's legal settlement is limited to customers who enrolled in Amazon Prime between June 23, 2019 and June 23, 2025. It's also restricted to customers who subscribed to Prime using a "challenged enrollment flow" or who enrolled in Prime through any method but were unsuccessful in canceling their memberships
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