Report from Reuters
In Brief – Federal Judge John Chun delivered several quick wins to the Federal Trade Commission (FTC) just days before the jury trial begins in its lawsuit accusing Amazon of violating federal consumer protection law by using deceptive practices, often called “dark patterns”, to encourage users to sign up for the Prime subscription program and then dissuade them from cancelling. On summary judgement, Chun ruled that Amazon violated the Restore Online Shoppers’ Confidence Act (ROSCA) when the company collected consumers’ billing information before it disclosed the material terms of its Prime subscription service to them, and that two of the three executives targeted by the FTC were guilty of the charge as well. Still to be decided at trial are whether a third senior executive is liable for ROSCA and FTC Act violations, whether Amazon violated the other two sections of ROSCA alleged by the FTC, and whether the FTC is entitled to civil penalties. Complaints targeting Amazon’s dark patterns practices to dissuade Prime members from cancelling started in Europe in 2021 and the company settled with EU regulators and made significant changes in 2022. An Amazon spokesperson responded to Chun’s ruling saying, “The bottom line is that neither Amazon nor the individual defendants did anything wrong.”
Context – Judge Chun is a central figure in the application of antitrust and regulatory policy to Amazon in the US. He is not just overseeing this FTC consumer protection dark patterns complaint, he is also overseeing the bigger and more consequential FTC antitrust lawsuit alleging that Amazon harmed online consumers and small business sellers by pushing online sellers to raise the prices they offer on other websites to match the higher prices they set on Amazon’s dominant marketplace to account for high Amazon fees, creating an elevated virtual price floor across the internet. Chun has set a fall 2026 trial date for that bigger FTC antitrust complaint. Chun is also handling two similar private antitrust lawsuits targeting Amazon for their price floor policies, one from defunct online marketplace Zulily and a consumer class action, rejecting Amazon motions to dismiss each.