Particle.news
Download on the App Store

Amazon to Pay $2.5 Billion to Settle FTC Case Over Prime Sign‑Up and Cancellation Tactics

The deal, reached days into a Seattle jury trial, couples a record rule‑violation penalty with broad refunds and mandated fixes to the user experience.

Overview

  • The agreement provides a $1 billion civil penalty and $1.5 billion in consumer refunds affecting an estimated 35 million people, with no admission of wrongdoing by the company.
  • U.S. District Judge John H. Chun approved the stipulated order, which ends the trial that began this week in federal court in Seattle.
  • Required changes include clear decline options, upfront disclosures of costs and auto‑renewal, elimination of misleading prompts like “No, I don’t want Free Shipping,” and a cancellation path as simple as enrollment.
  • Certain customers who enrolled via defined flows between June 23, 2019, and June 23, 2025, will receive automatic payments of up to about $51 within 90 days, while others can file claims.
  • An independent monitor will oversee compliance and redress distribution, and two executives, Jamil Ghani and Neil Lindsay, are barred from unlawful conduct related to the membership program.