FTC Secures Historic $2.5 Billion Settlement Against Amazon | Federal Trade Commission
Summary: The FTC reached a $2.5 billion settlement with Amazon to resolve charges that the company used deceptive 'dark patterns' to enroll consumers in Prime subscriptions and intentionally complicated the cancellation process.
This stipulated final order resolves a lawsuit (Case No. 2:23-cv-0932-JHC) filed by the Federal Trade Commission against Amazon.com, Inc. and two executives, Neil Lindsay and Jamil Ghani. The court found that Amazon violated the Restore Online Shoppers' Confidence Act (ROSCA) by failing to disclose material terms before obtaining billing information and by using deceptive user interfaces. The settlement requires Amazon to pay $1.5 billion in consumer redress and a $1 billion civil penalty. Additionally, the order mandates significant changes to Amazon's business practices, including the implementation of clear and conspicuous disclosures, the removal of 'double-stacked' sign-up buttons, and the provision of simple, non-burdensome cancellation mechanisms that mirror the enrollment process.
Document outline
1. I. Findings and Jurisdiction 2. II. Definitions (Billing Information, Challenged Enrollment Flow, Eligible Consumer, etc.) 3. III. Prohibition Against Misrepresentations 4. IV. Required Disclosures for Negative Option Features 5. V. Obtaining Express Informed Consent 6. VI. Simple Cancellation Mechanisms 7. VII. Additional Requirements (Button clarity, 'Renews' language, Price disclosure) 8. VIII. Monetary Judgments ($1.5B Redress, $1B Civil Penalty) 9. IX. Settlement Program and Claims Supervisor Requirements 10. X. Consumer Fund Distribution Process