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Amazon Requests Dismissal of FTC Suit Over Prime Practices

 |  October 20, 2023

Amazon has denied allegations of deceptive practices in relation to its Amazon Prime subscription service, urging U.S. District Judge John Chun in Seattle to dismiss the Federal Trade Commission’s (FTC) lawsuit. Amazon’s legal team argues that the case “fails in its entirety” per Reuters.

The FTC filed a lawsuit against Amazon in June, accusing the e-commerce giant of misleading consumers into enrolling in Prime and making it challenging for them to cancel their subscriptions. Amazon countered this by stating that it had “prominently and repeatedly” disclosed crucial terms, such as pricing and automatic renewal, to its Prime customers.

Amazon further accused the FTC of attempting to penalize the company through vague concepts, such as “manipulative” website designs, asserting that the standards proposed by the FTC are constitutionally unclear.

Read more: What’s Going On Between The FTC And Amazon?

“In a case supposedly about clarity, the FTC’s purported standards are unconstitutionally opaque,” Amazon stated. A company spokesperson emphasized that Prime’s sign-up and cancellation processes are intentionally designed to be “clear and simple” and have consistently met standards exceeding legal requirements.

The lawsuit is part of the Biden administration’s broader regulatory and enforcement actions against major technology firms.

In a separate case, the FTC, in September, accused Amazon of violating U.S. antitrust laws by imposing business practices that restrict merchants from offering lower prices than those on Amazon’s platform. This case is also pending in Judge Chun’s Seattle court.

The FTC’s lawsuit regarding Amazon Prime alleges that the company, “under substantial pressure” from the FTC, modified its cancellation process in April, just before the agency filed its lawsuit. The complaint highlights that “Amazon still requires five clicks on desktop and six on mobile for consumers to cancel from Amazon.com.”

A 10-day non-jury trial for this case is scheduled for February 2025.

Source: Reuters