Amazon Faces FTC Prime Subscription Trial This Week

Amazon’s subscription cancellation policy will face a jury trial this week.

As The Wall Street Journal (WSJ) reported Sunday (Sept. 21), the case will be a major test of the Federal Trade Commission’s (FTC) efforts to enforce what it alleges are deceptive subscription practices.

The regulator had sued Amazon in 2023, claiming the tech giant tricked people into signing up for its Amazon Prime program without their knowledge or consent, including by obscuring details about billing and the terms of free trials.

It is seeking civil penalties, refunds to consumers and a court order blocking Amazon from using subscription practices that could confuse or deceive consumers.

Amazon denies the allegations, saying it has always been clear about Prime’s terms and gives customers straightforward ways to end their memberships.

“The bottom line is that neither Amazon nor the individual defendants did anything wrong — we remain confident that the facts will show these executives acted properly and we always put customers first,” an Amazon spokesperson told WSJ.

Prentiss Cox, law professor at the University of Minnesota, said in an interview with WSJ that the tactics being alleged in the case are endemic in the eCommerce space, while also noting Amazon’s status as one of the largest retailers in America.

“If their practices are held to violate the law, everyone will pay attention,” Cox said. “This is an area in which consumers are outraged across the spectrum and that’s why there’s been so much legislative and regulatory activity.”

The FTC’s suit came as part of the agency’s larger effort to tackle “dark patterns,” or tactics employed by companies to manipulate consumer behavior that benefit a business at the expense of their customers.

In other Amazon news, PYMNTS wrote last week about the company’s upcoming Prime Day sales event in October, which serves as “both a lever and a litmus test,” letting the company gauge how much consumers are willing to spend and which categories resonate before committing to deeper investments in its holiday inventory.

“Layer in the uncertainty of today’s economy, and you can see why retailers are inventing more mini-holidays. They don’t need monthlong events, just enough runway to get people to justify that new TV, replace a dying fridge, or ‘invest’ in gadgets they didn’t know they needed until the discount showed up,” Frank Kenney, director of strategy at Cleo, said in an interview with PYMNTS.