A Civil Trial Begins in Seattle, Focusing on Whether Amazon’s Subscription Tactics Violate Consumer-Protection Laws

A civil trial is set to begin this week in a Seattle courtroom, marking a pivotal moment in the Federal Trade Commission’s (FTC) ongoing efforts to hold digital giants accountable for potentially deceptive subscription practices. At the center of the case is Amazon, the e-commerce giant, accused by the FTC of using misleading tactics to entice customers to sign up for its Prime membership and making it unnecessarily difficult for them to cancel. The FTC alleges that Amazon has deceived nearly 40 million customers, violating consumer-protection laws, and is seeking civil penalties, refunds, and a court order to prevent the company from using subscription practices that could confuse or deceive consumers.

Amazon’s Prime service, the world’s largest paid subscription program with at least 200 million users, offers benefits such as free and fast shipping, access to streaming services, and other perks. The FTC claims that Amazon obscured key details about billing and the terms of free trials, creating a “labyrinth” to make it hard to cancel, which the company internally referred to as “Iliad,” a nod to Homer’s epic tale of the long and arduous Trojan War. Amazon denies the allegations, stating it has always been transparent about its terms and provides straightforward ways for customers to cancel their memberships.

The case represents a significant test for the FTC’s enforcement campaign against so-called “dark patterns” in digital subscriptions—tactics designed to manipulate consumer behavior for the company’s benefit. Dark patterns can include practices like hiding cancellation links, using fine print to obscure important information, and creating complex cancellation processes to discourage customers from leaving. If the FTC prevails, it could set a precedent for how subscription services operate across the industry, potentially forcing companies to re-evaluate their practices and provide clearer, more transparent information to customers.

The trial will also determine the liability of several Amazon executives, including Neil Lindsay, Jamil Ghani, and Russell Grandinetti, based on their involvement in Prime’s enrollment and cancellation practices. Judge John Chun has ruled that if the FTC proves misconduct, these executives could be held individually liable.

The FTC’s push against deceptive subscription practices has gained momentum in recent years, with similar cases brought against companies like LA Fitness, Uber, and education technology firm Chegg. While the FTC has secured settlements with some of these companies, Amazon remains a major target. The agency is also pursuing a separate antitrust lawsuit against Amazon, accusing it of illegal monopolization in the online marketplace. A trial for that case is set for 2027.

Under the Biden administration, the FTC introduced a federal rule intended to make it as easy for consumers to cancel subscriptions as it is to sign up. The rule, which was set to take effect in 2023, would have required companies to create a simple mechanism for cancellation, prevent them from setting traps to keep consumers paying, and add more disclosure requirements. However, the rule was vacated by a federal appeals court earlier this year after industry groups challenged it.

Despite the legal battle, analysts suggest that a potential FTC victory may have limited impact on Amazon’s business, as most Prime members continue their subscriptions voluntarily. According to research, roughly 95% of current Prime members do not plan to cancel, indicating a strong consumer demand for the service. Amazon’s Prime membership has become an integral part of consumers’ shopping habits, with Prime members spending double the amount of other Amazon shoppers and accounting for roughly three-quarters of all purchases on the platform.

The outcome of the trial will be closely watched by consumer advocates, policymakers, and industry leaders, as it could have far-reaching implications for the digital subscription market and the way companies interact with their customers.