Amazon under fire as FTC sues over alleged tricky subscription tactics

AP Photo/Michel Euler

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The Federal Trade Commission (FTC) is throwing the legal gauntlet down on Amazon, accusing the e-commerce titan of deploying crafty tactics to ensnare customers into Amazon Prime subscriptions and creating a labyrinthine cancellation process.

The complaint, filed on Wednesday, alleges Amazon's deception led millions of unsuspecting consumers into enrolling in Prime's auto-renewal subscriptions, the Daily Wire reported.

The FTC has decried Amazon's alleged use of "manipulative, coercive, or deceptive user-interface designs" in Prime subscription sign-ups and its tortuous cancellation process.

FTC Chairwoman Lina Khan remarked:

Amazon tricked and trapped people into recurring subscriptions without their consent, costing users not only their patience but also significant money.

The lawsuit, lodged in the U.S. District Court in the Western District of Washington, calls out Amazon's practices as violations of the FTC Act and the Restore Online Shoppers’ Confidence Act.

Amazon retorted by categorically denying the allegations, championing its customers' affinity for Prime subscriptions. Amazon spokesperson Tim Doyle countered the FTC's claims as "false on the facts and the law," emphasizing Amazon's efforts to make Prime subscription management transparent and straightforward for customers.

He added:

As with all our products and services, we continually listen to customer feedback and look for ways to improve the customer experience, and we look forward to the facts becoming clear as this case plays out.

The FTC's complaint sheds light on an intriguing aspect of Amazon's alleged conduct, disclosing that the tech giant labeled the Prime cancellation process as the "Iliad," mirroring the extensive journey in Homer's epic.

The FTC claims this 'Iliad Flow' was intentionally designed to be convoluted, while Amazon's leadership reportedly declined or slowed down user-friendly modifications to the process due to potential impact on profits.

The filing also notes that Amazon reaped $9.6 billion from Prime subscriptions in the first quarter of this year alone, marking a 17% rise from the same period in the previous year.

Additionally, the complaint accuses Amazon of stalling the FTC's investigation by offering "bad faith" responses to document requests.

The FTC initiated its probe into Amazon Prime in March 2021, and this lawsuit represents a significant escalation in the ongoing scrutiny of the e-commerce giant's practices.