A trial in federal court in Seattle set to begin this week will cut to the heart of how Amazon defines itself as a champion for the hundreds of millions of consumers who regularly use its online shopping service.
The Federal Trade Commission claims, in a lawsuit filed two years ago, that Amazon tricked tens of millions of people into signing up for its Prime membership program, and then made it hard for customers to cancel when they wanted out.
“Amazon was aware for years that it was taking consumers’ money without their consent, yet chose to do nothing about it,” the F.T.C. wrote in a recent court filing.
Amazon, which denies those claims, hopes a jury will believe that customers signed up for Prime simply because they thought it was a good deal.
“The way Amazon drives Prime subscribers is by making the service useful and valuable,” Mark Blafkin, an Amazon spokesman, said in a statement. “And our approach works — Prime, with hundreds of millions of members, is among the highest performing subscription programs of any kind, as measured by renewal rates and customer satisfaction.”
Though less sweeping than the F.T.C.’s antitrust case against Amazon, targets the company for the way it runs a popular subscription program central to its business and ubiquitous in the lives of many of its customers.
“The Trump-Vance F.T.C. intends to secure justice for Americans harmed by Amazon’s practices,” Joe Simonson, an F.T.C. spokesman, said in a statement. “We’re looking forward to the trial.”
Since Prime was introduced two decades ago, it has grown into what the F.T.C. called “the world’s largest subscription service.” Amazon’s founder, Jeff Bezos, has long called it a “pillar” of the company. It costs $139 per year or $14.99 a month, and includes fast shipping, video streaming, discounts at Whole Foods, which Amazon owns, and other perks.
“We want Prime to be such a good value, you’d be irresponsible not to be a member,” Mr. Bezos wrote in 2016.
Judge John H. Chun of the U.S. District Court for the Western District of Washington ruled last week that at least two senior executives, Neil Lindsay and Jamil Ghani, would automatically be considered personally liable if a jury finds that Amazon violated the law.
Amazon said the executives acted properly and put customers first.
Judge Chun also scolded Amazon for withholding tens of thousands of documents he ruled were improperly marked privileged. He wrote that it “appears that the desire to gain a tactical advantage led to such conduct” and that was “tantamount to bad faith.”
“We remain confident that the facts will show these executives acted properly and we always put customers first,” Mr. Blafkin, the Amazon spokesman, said in a statement.
Jury selection is scheduled to begin Monday, with opening arguments starting on Tuesday. The case is set to last for about a month. If the jury concludes that Amazon broke the law, the judge will determine any penalties. The F.T.C. has not yet asked for specific monetary damages.
An estimated 200 million people in the United States use Prime to shop on Amazon. Subscriptions, primarily Prime, brought in more than $44 billion last year, but it’s value to Amazon goes far beyond the monthly fees. Prime members are the company’s best customers — they buy more things, and more often, than people not signed up for the service.
Customers rarely drop Prime, and the subscription feeds shopping habits, said Michael Levin, whose company, Consumer Intelligence Research Partners, has surveyed Amazon shoppers for more than a decade. His firm estimates that Prime members spend twice as much on Amazon compared with non-Prime customers.
“We can’t stress enough how important Prime is to Amazon’s retail business,” he said in an interview.
The F.T.C. case centers on the idea of “dark patterns” — whether a website’s design knowingly steers customers into subscriptions they don’t really want or makes it very difficult for them to cancel. The F.T.C. said documents show the process for canceling a Prime membership internally was called Iliad, after the ancient epic poem about the long war between the Greeks and the city of Troy.
“Rather than simply allowing consumers to cancel, each page of Amazon’s Iliad process bombards consumer with links, offers and other information to remove them from the cancellation flow,” the F.T.C. argued in a court filing last week.
The company built its business with a patented “1-Click” ordering button, making it faster to buy an item. But executives said in an internal meeting that they wanted customers “to pause and think a bit before canceling” the subscription, the F.T.C. said in a court filing.
Amazon countered that nudging customers to try new services and requiring a few clicks to cancel was standard industry practice that customers had come to expect. “Consumers are familiar with — and therefore readily understand and navigate — cancellation processes that contain offers and other marketing information,” the company argued.
Amazon said in its own court filings that the F.T.C.’s case misinterprets internal data and takes correspondence out of context. “Leadership consistently emphasized that customer trust — which will be broken if customers feel tricked, confused or deceived — was paramount,” the company wrote.
Amazon first heard from the F.T.C. in March 2021, two months into President Joseph R. Biden Jr.’s term, when the agency issued a civil investigative demand for various documents related to Prime. It was just a few days before Mr. Biden announced he planned to nominate Lina Khan, a scholar who built her career on legal arguments critiquing Amazon, to the commission, and she eventually became the chair.
When the F.T.C. sued Amazon in 2023, it was the first time the agency had taken Amazon to court under Ms. Khan.
But the F.T.C. didn’t actually start looking into Prime until the waning days of the first Trump administration, according to a person familiar with the investigation who was not authorized to speak publicly. Under the second Trump administration, the F.T.C. has continued pursuing the case. This summer it settled with the education technology company Chegg and the dating app Match over similar subscription issues.
Amazon “knew about the staggering amount of harm their practices caused Prime consumers, and yet they did nothing to solve the problem, or even required it to continue, out of fear of harming Amazon’s bottom line,” the F.T.C. argued in a recent filing.
Amazon countered that given Prime’s scale, it was inevitable that some customers would be frustrated or make mistakes. “Evidence that a small percentage of customers misunderstood Prime enrollment or cancellation does not prove that Amazon violated the law,” the company said.
Karen Weise writes about technology for The Times and is based in Seattle. Her coverage focuses on Amazon and Microsoft, two of the most powerful companies in America.
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