Amazon Prime customers who experienced slower deliveries because they lived in majority-Black neighborhoods east of the Anacostia River will receive millions of dollars in refunds after the company settled a lawsuit brought by the District, the city attorney general’s office announced Thursday.
The lawsuit accused Amazon of secretly excluding Ward 7 and Ward 8 Zip codes — 20019 and 20020 — from the company’s own branded delivery services, using third-party carriers such as UPS and the U.S. Postal Service instead, which significantly slowed delivery times, despite charging the same price for Prime memberships.
D.C. Attorney General Brian Schwalb (D) said in a statement that the online retailer will refund $7.25 million in membership fees to about 69,000 D.C. customers, pay the District $1 million in penalties, and “reform its practices.”
“No company is above the law, no matter how big or powerful,” Schwalb said.
Steve Kelly, a spokesperson for Amazon, said in a statement that the change in delivery carriers was made due to safety concerns and that the settlement was “in no way” an admission of wrongdoing. The company chose to settle the lawsuit, he said, “rather than engage in prolonged litigation.”
“We chose to resolve this matter so we can stay focused on what we do best: delivering great service to every customer across Washington D.C.,” Kelly said.
The refunds will be based on how much customers paid in membership fees while they were being excluded, and will likely amount to nearly half of their total fees paid during that period, according to the attorney general’s office.
Sehree Mickel, who has lived in the Benning Ridge neighborhood of D.C. for more than six years, said the settlement affirmed her original concern that the company was “red lining” lower-income neighborhoods in the city.
“It’s an acknowledgment of a wrongdoing that had been done against this community,” she said, “so I believe this settlement speaks volumes.”
Starting in the summer of 2022, Amazon decided to stop using its own fleet of trucks to make deliveries to Prime customers in Wards 7 and 8; Prime users pay about $15 a month or $139 a year for next-day and same-day deliveries, according to the lawsuit.
But the company never notified those customers of the change, and when consumers complained about slow deliveries, Amazon “concealed the exclusion and led customers to believe it was due to other circumstances,” according to the attorney general’s office.
“While companies are legally permitted to make operational changes, they are also legally required to inform customers of any adverse impacts those changes will have on the quality of service so that consumers can make informed purchasing decisions,” the attorney general’s office said.
Since the lawsuit was filed in 2024, Amazon has said it was “categorically false” that the company’s business practices were discriminatory or deceptive, a position the company still maintains. (Amazon Executive Chairman Jeff Bezos owns The Washington Post).
“In the Zip codes at issue, drivers faced specific, documented safety threats, and we adjusted operations to protect them, while still supporting delivery through other carriers,” Kelly said Thursday.
Kelly said the company’s terms make clear that delivery speeds could be influenced by outside factors and that Amazon is transparent about when packages will be delivered during the checkout process.
Mickel said she remains a Prime customer because she lives in a community that is in “desperate need” of the company’s services.
“Our ward is a food desert,” Mickel said. “We have had a number of pharmacies close down in our community for one reason or another, so having the same-day or two-day services is critical.”
Amazon “ceased excluding” Ward 7 and 8 consumers from full delivery services in April of this year, the attorney general’s office said.
Mickel said she has noticed and shared with the attorney general’s office that Amazon delivery vans are operating in her neighborhood, but they don’t have the company’s branding. She called them “ghost delivery” vans.
Kelly said Amazon delivery vans have begun servicing the Zip codes again and that “conditions have improved” since the lawsuit filing.
While the settlement was welcome, Mickel said she felt there was more that could be done.
“I think they owe us more than just a settlement of a dollar amount,” Mickel said. “I think they should come in and try to invest more in our community, get to know our community.”
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