The Federal Trade Commission (FTC) has filed a lawsuit against Amazon in the United States, alleging that the online retailer tricked consumers into subscribing to its “Prime” service and made the cancellation process intentionally complicated. The lawsuit includes four civil charges against Amazon for “manipulative, coercive or deceptive user-interface” and seeks a permanent injunction on the conduct, as well as monetary penalties.
Deceptive Practices
Amazon’s Prime service costs shoppers $14.99 per month or $139 annually and offers perks such as free shipping and access to Amazon entertainment shows and movies. The FTC complaint alleges that Amazon used screen prompts and discount offers to route shoppers into the Prime program without providing “clear and conspicuous disclosures” regarding price and auto-renewal. The complaint also outlines Amazon’s onerous process for cancelling Prime, which company officials reportedly nicknamed “Iliad” due to its intentional difficulty.
Cancellation Process
The Iliad Flow required consumers intending to cancel to navigate a four-page, six-click, fifteen-option cancellation process, while customers could enrol in Prime with one or two clicks. The complaint notes that Amazon modified its cancellation process around April 2023 “under substantial pressure from the commission” ahead of Wednesday’s litigation. The FTC alleges that Amazon tricked and trapped people into recurring subscriptions without their consent, costing them significant amounts of money.
FTC Reaction
FTC Chair Lina Khan stated that “Amazon tricked and trapped people into recurring subscriptions without their consent, not only frustrating users but also costing them significant money. The FTC will continue to vigorously protect Americans from ‘dark patterns’ and other unfair or deceptive practices in digital markets.” The lawsuit seeks to prohibit Amazon from engaging in similar practices in the future and to provide refunds to affected consumers.
Overall, the FTC’s lawsuit against Amazon highlights the importance of transparent subscription practices and clear cancellation processes. Consumers should be able to make informed decisions about their purchases and have the ability to cancel subscriptions without undue hassle. The outcome of the lawsuit will likely have significant implications for other online retailers and their subscription practices.
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