# Case 2:23-cv-00932-JHC Document 67 Filed 09/20/23 Page 1 of 92 (2023)

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## Record

- **Collection:** Agency decision
- **Document type:** Agency decision

## Text

Case 2:23-cv-00932-JHC Document 67 Filed 09/20/23 Page 1 of 92

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UNITED STATES DISTRICT COURT
WESTERN DISTRICT OF WASHINGTON
AT SEATTLE

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Civil Action No. 2:23-cv-0932-JHC

FEDERAL TRADE COMMISSION,

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Plaintiff,

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v.

AMENDED COMPLAINT FOR
PERMANENT INJUNCTION,
CIVIL PENALTIES, MONETARY
RELIEF, AND OTHER
EQUITABLE RELIEF

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AMAZON.COM, INC., a corporation;

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NEIL LINDSAY, individually and as an officer of
AMAZON.COM, INC.;

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RUSSELL GRANDINETTI, individually and as
an officer of AMAZON.COM, INC.; and
JAMIL GHANI, individually and as an officer of
AMAZON.COM, INC.,

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Defendants.

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Plaintiff, the Federal Trade Commission (“FTC” or “the Commission”), alleges:

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1.

Plaintiff brings this action under Sections 5(a), 5(m)(1)(A), 13(b), 16(a), and 19 of

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the Federal Trade Commission Act (“FTC Act”), 15 U.S.C. §§ 45(m)(1)(A), 53(b), 57b, and the

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Restore Online Shoppers’ Confidence Act, (“ROSCA”), 15 U.S.C. § 8404, which authorize the

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AMENDED COMPLAINT
Case No. 2:23-cv-0932-JHC

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Federal Trade Commission
600 Pennsylvania Ave., NW
Washington, DC 20580
(202) 326-3320

Case 2:23-cv-00932-JHC Document 67 Filed 09/20/23 Page 2 of 92

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FTC to seek, and the Court to order, permanent injunctive relief, restitution, civil penalties, and

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other equitable relief for Defendants’ acts or practices in violation of Section 5(a) of the FTC

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Act, 15 U.S.C. § 45(a), and Section 4 of ROSCA, 15 U.S.C. § 8403.
SUMMARY OF CASE

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For years, Defendant Amazon.com, Inc. (“Amazon”) and its leadership have

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knowingly duped millions of consumers into unknowingly enrolling in its Amazon Prime service

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(“Nonconsensual Enrollees” or “Nonconsensual Enrollment”). Specifically, Amazon used

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manipulative, coercive, or deceptive user-interface designs known as “dark patterns” to trick

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consumers into enrolling in automatically-renewing Prime subscriptions.

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3.

The Nonconsensual Enrollment problem was well known within Amazon. The

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company’s internal documents are littered with references to “accidental” signups. In early

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2019, for example, an Amazon survey showed

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cancelling Prime was that they never intended to enroll in the first place. And in September

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2020, Amazon estimated that

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subscribed to Prime.

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4.

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of consumers stated their reason for

Prime subscribers were “unaware” they had

In a draft memorandum from late 2020, Amazon designers and researchers

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documented the company’s use of techniques “designed to mislead or trick users to make them

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do something they don’t want to do, like signing up for a recurring bill.”

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5.

Some Amazon employees pushed the company executives responsible for

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Prime—including Defendants Neil Lindsay (“Lindsay”), Russell Grandinetti (“Grandinetti”) and

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Jamil Ghani (“Ghani”)—to address Nonconsensual Enrollment and make changes so that

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Amazon would not be tricking its customers. One employee, for example, wrote to Ghani: “The

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AMENDED COMPLAINT
Case No. 2:23-cv-0932-JHC

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Federal Trade Commission
600 Pennsylvania Ave., NW
Washington, DC 20580
(202) 326-3320

Case 2:23-cv-00932-JHC Document 67 Filed 09/20/23 Page 3 of 92

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way I see it, we are not winning for customers by ignoring the simple and obvious lack of

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information but applauding a business gain. We congratulate when someone changes a headline

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color, or the style of a table, but don’t notice we are not even telling customers what they are

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signing up for . . . .”

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6.

Despite their knowledge of the problem and pleas from some employees to fix it,

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Amazon and its leadership—including Lindsay, Grandinetti, and Ghani—slowed, avoided, and

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even undid user experience changes that they knew would reduce Nonconsensual Enrollment

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because those changes would also negatively affect Amazon’s bottom line. As one internal

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memorandum stated, Amazon decided “clarifying” the enrollment process was not the “right

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approach” because it would cause a “shock” to business performance.

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7.

For years, Amazon also knowingly complicated the cancellation process for

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Prime subscribers who sought to end their membership. Under significant pressure from the

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Commission—and aware that its practices are legally indefensible—Amazon substantially

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revamped its Prime cancellation process for at least some subscribers shortly before the filing of

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the Complaint for Permanent Injunction, Civil Penalties, Monetary Relief, and Other Equitable

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Relief (“Complaint”). Dkt. #1. However, prior to that time, the primary purpose of the Prime

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cancellation process was not to enable subscribers to cancel, but rather to thwart them. Fittingly,

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Amazon named that process “Iliad,” which refers to Homer’s epic about the long, arduous Trojan

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War. Amazon designed the Iliad cancellation process (“Iliad Flow”) to be labyrinthine, and

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Amazon and its leadership—including Lindsay, Grandinetti, and Ghani—slowed or rejected user

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experience changes that would have made Iliad simpler for consumers because those changes

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adversely affected Amazon’s bottom line.

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AMENDED COMPLAINT
Case No. 2:23-cv-0932-JHC

3

Federal Trade Commission
600 Pennsylvania Ave., NW
Washington, DC 20580
(202) 326-3320

Case 2:23-cv-00932-JHC Document 67 Filed 09/20/23 Page 4 of 92

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8.

As with Nonconsensual Enrollment, the Iliad Flow’s complexity resulted from

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Amazon’s use of dark patterns—manipulative design elements that trick users into making

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decisions they would not otherwise have made.
JURISDICTION AND VENUE

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and 1345.

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10.

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This Court has subject matter jurisdiction pursuant to 28 U.S.C. §§ 1331, 1337(a),

Venue is proper in this District under 28 U.S.C. § 1391(b)(2), (b)(3), (c)(1),

(c)(2), (c)(3), and (d), and 15 U.S.C. § 53(b).
PLAINTIFF

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The FTC is an independent agency of the United States Government created by

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the FTC Act, which authorizes the FTC to commence this district court civil action by its own

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attorneys. 15 U.S.C. §§ 41-58. The FTC enforces Section 5(a) of the FTC Act,

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15 U.S.C. § 45(a), which prohibits unfair or deceptive acts or practices in or affecting commerce.

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The FTC also enforces ROSCA, 15 U.S.C. §§ 8401-8405, which prohibits the sale of goods or

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services on the Internet through negative option marketing without meeting certain requirements

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for disclosure, consent, and cancellation to protect consumers. A negative option is an offer in

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which the seller treats a consumer’s silence—i.e., their failure to reject an offer or cancel an

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agreement—as consent to be charged for goods and services. 16 C.F.R. § 310.2(w).
DEFENDANTS

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Defendant Amazon transacts and has transacted business in this District and

throughout the United States. It is one of the world’s largest online retailers, and is

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AMENDED COMPLAINT
Case No. 2:23-cv-0932-JHC

4

Federal Trade Commission
600 Pennsylvania Ave., NW
Washington, DC 20580
(202) 326-3320

Case 2:23-cv-00932-JHC Document 67 Filed 09/20/23 Page 5 of 92

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headquartered in Seattle, Washington, with its principal place of business at 410 Terry Avenue

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North, Seattle, Washington 98109.
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At all times relevant to this Amended Complaint, acting alone or in concert with

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others, Amazon advertised, marketed, distributed, or sold a paid subscription service, Prime, that

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gives subscribers throughout the United States access to additional services otherwise

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unavailable or available only at an additional charge to other consumers. Among other things,

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these premium services include expedited “free” delivery of merchandise from Amazon’s vast

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online marketplace, streaming content, and grocery delivery.
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Defendant Lindsay resides in Laguna Beach, California. Lindsay has worked as a

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senior Amazon executive since 2010. From February 2018 through November 2021, Lindsay

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was the Amazon executive with the most responsibility for the Prime subscription program,

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which he managed as an Amazon Vice-President and Senior Vice-President. During this period,

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Lindsay joined Amazon’s S-Team, which runs the entire company and reports directly to the

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CEO.

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From February 2018 through November 2021, acting alone or in concert with

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others, Lindsay formulated, directed, controlled, had the authority to control, or participated in

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the acts and practices of Amazon, including the acts and practices set forth in this Amended

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Complaint. Lindsay participated in these unlawful acts and practices by directing that they

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continue despite knowing the consumer injury they caused.

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Lindsay’s participation in the unlawful acts and practices set forth in this

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Amended Complaint includes, among other things: (a) in mid-2018, Lindsay declined to

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implement changes that would have avoided Nonconsensual Enrollment; (b) Lindsay

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AMENDED COMPLAINT
Case No. 2:23-cv-0932-JHC

5

Federal Trade Commission
600 Pennsylvania Ave., NW
Washington, DC 20580
(202) 326-3320

Case 2:23-cv-00932-JHC Document 67 Filed 09/20/23 Page 6 of 92

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participated in a June 17, 2019 meeting with Defendant Grandinetti at which these executives

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decided not to make changes that would reduce Nonconsensual Enrollment; (c) in December

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2020, Lindsay participated in a decision to reverse changes that would help prevent

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Nonconsensual Enrollment; and (d) Lindsay oversaw Amazon employees who studied the Iliad

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Flow, including the complications it presented to subscribers attempting to cancel, and who

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developed simpler alternatives, which Lindsay did not implement.
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Lindsay knew these acts and practices would cause consumer injury because,

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among other things: (a) Lindsay directed a “deep dive” into the Nonconsensual Enrollment

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problem in 2018 and received numerous memoranda addressing Nonconsensual Enrollment

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including, among others, a 2019 memorandum entitled “Customer Frustrations Elimination

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Program: Prime Frustrations” (“Prime Frustrations Memo”) that identified the fact that

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“customers sign up without knowing they did” as a “customer problem”; and (b) Lindsay

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received internal memoranda, emails, and oral communications describing the Iliad Flow and the

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complications it presented to Prime subscribers attempting to cancel, and he knows, and has

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known at all times relevant to this Amended Complaint, that the Iliad Flow is not simple.
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Defendant Lindsay has transacted business in this District and throughout the

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United States, and continues to transact business in this District and throughout the United

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States.

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Defendant Grandinetti resided in the United States during the majority of the

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period during which he participated in the acts and practices set forth in this Amended Complaint

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(Grandinetti moved to the United Kingdom in 2021 to further his employment with Amazon).

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Grandinetti oversees Amazon’s Prime subscription program as an Amazon Senior Vice-President

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AMENDED COMPLAINT
Case No. 2:23-cv-0932-JHC

6

Federal Trade Commission
600 Pennsylvania Ave., NW
Washington, DC 20580
(202) 326-3320

Case 2:23-cv-00932-JHC Document 67 Filed 09/20/23 Page 7 of 92

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with a portfolio that includes Prime. During this period, Grandinetti was a member of Amazon’s

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S-Team, which runs the entire company and reports directly to the CEO.

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From at least January 1, 2018 through the present, acting alone or in concert with

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others, Grandinetti formulated, directed, controlled, had the authority to control, or participated

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in the acts and practices of Amazon within the United States, including the acts and practices set

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forth in this Amended Complaint. As an Amazon executive with authority over the Prime

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enrollment and cancellation process within the United States, Defendant Grandinetti participated

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in these unlawful acts and practices by directing that they continue despite knowing the

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consumer injury they caused.

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Grandinetti’s participation in the unlawful acts and practices set forth in this

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Amended Complaint and occurring within the United States includes, among other things: (a)

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Grandinetti directed the preparation of, and reviewed, the Prime Frustrations Memo summarizing

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the Nonconsensual Enrollment problem; (b) Grandinetti ran a June 17, 2019 meeting with

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Defendant Lindsay and others in which Grandinetti discussed the Prime Frustrations Memo and

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directed subordinates not to address Nonconsensual Enrollment unless it could be resolved while

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maintaining Prime subscription numbers; and (c) Grandinetti oversaw, and continues to oversee,

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Amazon employees who studied the Iliad Flow including the complications it presented to

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subscribers attempting to cancel, and who developed simpler alternatives, which Grandinetti did

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not implement.

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Grandinetti knew these acts and practices would cause consumer injury because,

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among other things: (a) he reviewed the 2019 memorandum, which identified the fact that

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“customers sign up without knowing they did” as a major “customer problem”; and (b) he

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AMENDED COMPLAINT
Case No. 2:23-cv-0932-JHC

7

Federal Trade Commission
600 Pennsylvania Ave., NW
Washington, DC 20580
(202) 326-3320

Case 2:23-cv-00932-JHC Document 67 Filed 09/20/23 Page 8 of 92

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knows, and has known at all times relevant to this Amended Complaint, that the Iliad Flow is not

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simple.
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Defendant Grandinetti has transacted business in this District and throughout the

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United States, and continues to transact business in this District and throughout the United

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States.

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Defendant Ghani resides in Bellevue, Washington. Since 2019, Ghani has

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overseen Prime’s subscription program as a Vice-President. From 2019 through the present,

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acting alone or in concert with others, Ghani formulated, directed, controlled, had the authority

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to control, or participated in the acts and practices of Amazon, including the acts and practices

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set forth in this Amended Complaint. As an Amazon executive with authority over the Prime

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enrollment and cancellation process, Ghani participated in these unlawful acts and practices by

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directing that they continue despite knowing the consumer injury they caused.

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Ghani’s participation in the unlawful acts and practices set forth in this Amended

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Complaint includes, among other things: (a) Ghani participated in a December 2020 decision to

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reverse changes that would help prevent Nonconsensual Enrollment; and (b) Ghani oversaw, and

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continues to oversee, Amazon employees who studied the Iliad Flow and the complications it

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presented subscribers attempting to cancel, and who developed simpler alternatives, which Ghani

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did not implement.

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Ghani knew these acts and practices would cause consumer injury because,

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among other things: (a) Ghani received dozens of internal memoranda, emails, and oral

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communications describing the Nonconsensual Enrollment problem including, for example, a

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2020 memorandum entitled “US Prime Performance Update”; and (b) Ghani received internal

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AMENDED COMPLAINT
Case No. 2:23-cv-0932-JHC

8

Federal Trade Commission
600 Pennsylvania Ave., NW
Washington, DC 20580
(202) 326-3320

Case 2:23-cv-00932-JHC Document 67 Filed 09/20/23 Page 9 of 92

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memoranda, emails, and oral communications describing the Iliad Flow and the complications it

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presented to subscribers attempting to cancel, and he knows, and has known at all times relevant

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to this Amended Complaint, that the Iliad Flow is not simple.
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Defendant Ghani has transacted business in this District and throughout the

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United States, and continues to transact business in this District and throughout the United

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States.
COMMERCE

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At all times relevant to this Amended Complaint, Defendants have maintained a

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substantial course of trade in or affecting commerce, as “commerce” is defined in Section 4 of

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the FTC Act, 15 U.S.C. § 44.
DEFENDANTS’ BUSINESS ACTIVITIES

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Consumers pay $139 per year or $14.99 monthly to subscribe to Prime. Prime

subscription fees account for $25 billion of Amazon’s annual revenue.

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Approximately 70% of Amazon’s revenue comes from American consumers.

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Subscribers are critical to Amazon’s overall ecommerce business because Prime

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subscribers spend more than

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Prime shoppers.

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as much shopping on Amazon as compared to non-

Consequently, one of Amazon’s primary business goals—and the primary

business goal of Prime—is increasing subscriber numbers.
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Within Amazon’s corporate structure, the Prime organization or department

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(“Prime Organization”) operates Prime. Amazon evaluates the Prime Organization’s

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performance based on the number of subscribers.

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AMENDED COMPLAINT
Case No. 2:23-cv-0932-JHC

9

Federal Trade Commission
600 Pennsylvania Ave., NW
Washington, DC 20580
(202) 326-3320

Case 2:23-cv-00932-JHC Document 67 Filed 09/20/23 Page 10 of 92

Typical Prime Enrollment Experiences

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Consumers can subscribe to Prime through multiple pathways including through

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Amazon devices (like the Amazon Fire TV streaming device), while using Prime Video, or

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through Prime’s unique webpage (“Prime Central”). However,

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the Amazon shopping checkout process.

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35.

•

subscriptions occur through

The basic consumer checkout enrollment experience proceeds as follows on both

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desktop and mobile devices. Consumers who are not Prime members visit Amazon’s website—

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www.Amazon.com—to shop. They place items in their cart, and then provide (or confirm) their

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billing and address information. They then select a large orange “Continue” button, which

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typically appears in the lower right corner of the page, and move through additional pages to

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proceed with their purchase. Finally, consumers either complete their order by purchasing the

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items in their cart or abandon their cart.

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Amazon presents all consumers who are not Prime subscribers with at least one

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opportunity (also known as an “upsell”)—and often several opportunities—to join Prime before

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those consumers place their order on the final checkout page. Amazon has two primary types of

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upsells that enroll consumers: interstitials and non-interstitials. An interstitial is a page that

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interrupts consumers’ online shopping experience by appearing before the page that consumers

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seek to access in the first place. In contrast, non-interstitial upsells are elements imbedded

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within checkout pages, including shipping-option selection and payment pages.

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AMENDED COMPLAINT
Case No. 2:23-cv-0932-JHC

10

Federal Trade Commission
600 Pennsylvania Ave., NW
Washington, DC 20580
(202) 326-3320

Case 2:23-cv-00932-JHC Document 67 Filed 09/20/23 Page 11 of 92

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37.

On desktop devices, Amazon has several Prime upsells: an interstitial upsell

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called the Universal Prime Decision Page (“UPDP”), and three non-interstitial upsells called the

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Shipping Option Select Page (“SOSP”), Single Page Checkout (“SPC”), and True Single Page

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Checkout (“TrueSPC”). On mobile devices, Prime upsells mirror those on desktop, and include

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the UPDP, SOSP, and SPC.

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UPDP on Desktop. Amazon calls the Prime interstitial upsell the Universal

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Prime Decision Page. Although the UPDP has changed over time, it generally interrupts

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consumers’ online shopping experience by presenting them with a prominent button to enroll in

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Prime and a comparatively inconspicuous link to decline. Consumers cannot avoid the UPDP.

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The upsell forces consumers to select either the button or the link to proceed to checkout. See

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Attachments A–D.

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No thanks, I do not want fast, free shipping

Get FREE Two-Day Shipp ing

Enjo Prime FREE for 30 days

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39.

The UPDP’s orange button, which enrolls a consumer in Prime if clicked, is

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located toward the bottom right of the screen and often includes language referencing “free

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shipping” or a “free trial.” For instance, in May 2018, the UPDP orange button read: “Get FREE

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Two-Day Shipping.” See Attachment A. In February 2020, the button read “Get FREE Two-

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Day Delivery.” See Attachment B. In some instances, the button reads “Start Your 30-Day

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Prime FREE Trial” or a variant thereof, as it did in October 2018 and July 2020. See

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Attachments C and D. Additionally, the button is stacked above a gray box that either states

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23

AMENDED COMPLAINT
Case No. 2:23-cv-0932-JHC

11

Federal Trade Commission
600 Pennsylvania Ave., NW
Washington, DC 20580
(202) 326-3320

Case 2:23-cv-00932-JHC Document 67 Filed 09/20/23 Page 12 of 92

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“Enjoy Prime FREE for 30 days,” see Attachment A and B, “No minimum order size,” “No

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commitments. Cancel anytime,” see Attachments C and D, or similar language.

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40.

If a consumer clicks the orange button, Amazon enrolls the consumer in a Prime

free trial, even if the consumer later abandons the cart and does not order the merchandise.
41.

The UPDP’s blue link, which declines the Prime membership if clicked, is located

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towards the bottom left of the screen and includes language that the consumer will not receive

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“free shipping.” For example, in 2018, the blue link read “No thanks, I do not want fast, free

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shipping,” see Attachment A, and in February 2020 read “No thanks, I do not want fast, FREE

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delivery,” see Attachment B. Sometimes the blue link refers to benefits more generally. For

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example, in October 2018, the link stated “Continue without the Amazon Prime benefits.” See

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Attachment C. More recently, the link states “No thanks.” See Attachment D.

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42.

The contrast between an orange “double-stacked” button to enroll in Prime and a

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blue link to decline prioritizes the enrollment option over the decline option and creates a visual

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imbalance. See Attachments A–D.

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43.

The UPDP does not adequately disclose the price of the monthly auto-renewal

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feature of Prime. That information is located in small print at the bottom of the page, along with

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a link to the Prime terms and conditions. See Attachments A–D.

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44.

By October 2022, Amazon modified the circumstances under which prospective

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members see the UPDP. Amazon distinguishes between (i) existing Amazon accountholders

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who are not Prime subscribers, but have shopped on Amazon before and created a profile with

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shipping and billing information, and (ii) consumers who have not shopped on Amazon before or

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23

AMENDED COMPLAINT
Case No. 2:23-cv-0932-JHC

12

Federal Trade Commission
600 Pennsylvania Ave., NW
Washington, DC 20580
(202) 326-3320

Case 2:23-cv-00932-JHC Document 67 Filed 09/20/23 Page 13 of 92

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are otherwise not associated with an existing customer profile. At present, the checkout flow

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UPDP presents as follows to consumers with an existing Amazon account:

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(a)

The UPDP contains a banner across the top reading: “thank you for being

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a loyal customer. We’re giving you Prime FREE for 30 days,” with a line immediately below

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stating the date by which the customer will receive the items “with Prime.” See Attachment E.

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Test, thank y,ou for being a loyal customer~
We're giving you Pri1
m-e FREE for 30 days.

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R-eGeive eligible items Thursday, D c. 22 by 8PM with P•rime

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(b)

On the right-hand side beneath the banner, Amazon places a chart

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comparing the delivery cost without Prime ($5.99 in Attachment E) with the free delivery cost of

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Prime. Below the chart, Amazon states how much money the consumer would save on their

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“Prime eligible items” with “FREE Prime Delivery” on the order. Amazon also states that

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“After your FREE trial, Prime auto-renews for just $14.99/month.” See Attachment E.

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Delivery details:

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$5.99

FREE

......._,,.,

with FREE Prime Delivery on this order.
After your FREE trial, Prime auto-renews
for just $14.99/month.

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prime

Save $5.99 on your Prime eligible items

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Delivery ~ost without
Prime

(c)

On the bottom right-hand side, Amazon places a double-stacked button.

The orange top button reads “Get FREE Prime Delivery with Prime,” and the bottom grey box
AMENDED COMPLAINT
Case No. 2:23-cv-0932-JHC

13

Federal Trade Commission
600 Pennsylvania Ave., NW
Washington, DC 20580
(202) 326-3320

Case 2:23-cv-00932-JHC Document 67 Filed 09/20/23 Page 14 of 92

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reads “Enjoy Prime FREE for 30 days.” See Attachment E. If the consumer clicks on the orange

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button, Amazon enrolls the consumer into Prime, even if the consumer does not complete the

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order for the items in their cart.

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(d)

On the bottom left-hand side, Amazon has placed a blue link that reads

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“No thanks.” A consumer clicking this link would avoid a Prime membership and proceed to the

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following page of the checkout flow. See Attachment E.

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(e)

To continue purchasing the item(s) in their cart, consumers must either

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choose the larger orange “Get FREE Prime delivery” button or the smaller blue “No thanks”

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link. See Attachment E.

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(f)

At the very bottom of the page, in small print, Amazon presents a link to

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the Prime terms and conditions, and text stating: “Your Amazon Prime membership continues

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until cancelled. If you do not wish to continue for $14.99/month plus any applicable taxes, you

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may cancel anytime by visiting Your Account and adjusting your membership settings.” See

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Attachment E.

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45.

At present, the UPDP within the checkout flow presents as follows to consumers

who set up a brand-new Amazon account in making their first purchase:
(a)

The UPDP reads “Try Prime FREE for 30 days and save $5.99 on this

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order in both shipping and savings. Cancel anytime” at the top. Underneath, Amazon adds

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“After your trial, Prime is only $14.99/month.” Amazon also includes a table listing additional

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AMENDED COMPLAINT
Case No. 2:23-cv-0932-JHC

14

Federal Trade Commission
600 Pennsylvania Ave., NW
Washington, DC 20580
(202) 326-3320

Case 2:23-cv-00932-JHC Document 67 Filed 09/20/23 Page 15 of 92

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Prime benefits, such as “Fast, FREE delivery on Prime eligible items,” “All the music + top

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podcasts ad-free on Amazon Music,” and “Prime Video.” See Attachment F.
(b)

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Amazon then shows two buttons. The orange button on the right states

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“Sign up for Prime” and the grey button on the left states “Not right now.” If a consumer clicks

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on the “Sign up for Prime,” Amazon immediately enrolls the consumer. See Attachment F.
(c)

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At the bottom of the page, in small print, Amazon presents a link to the

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Amazon Prime terms and conditions, as well as text that reads: “Your Amazon Prime

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membership continues until cancelled. If you do not wish to continue for $14.99/month plus any

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applicable taxes, you may cancel anytime by visiting Your Account and adjusting your

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membership settings.” See Attachment F.
(d)

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The UPDP appears “on top” of the last page of the checkout flow, forcing

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the consumer to select “Sign up for Prime” or “Not right now” to proceed to the last page of the

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checkout flow. See Attachment F.

14

Try Prime FREE for 30 days and save $5.99 on this order in both shipping and savings. Cancel anytime.
Aft, r yourtri.1l, Prim e l,s: only 'S,'1A.99/month .

15
16
17
18

prime

Mart Prim e Benefits

'-.__;I

Fast, FR EE delivery on Prime eligible items

Included

All the. music+ top podcasts ad-free. on Amazon Music

Included

Prime Video

lndudtd

rJ Use my glft aird balance, when available, to pay for Prime.
Not right now

19
20
21
22
23

Sign

for Prime

By signing up, you acknowledge that you have read and agree to the Amazon Prime Terms ar.d Conditions and authorize us to charge your default payment method (Visa .... _1111) or another available

paymMt method on flle after your 30-day fret lriaL You r Amazon Primt membership continues until cancelled. If you do not wish to continu e for $14.99/month plus any a ppUcabte taxes, you rn ay
cancel •nytlme by visiting Your Account and adjusting your membe r>hlp settings. For customers In Hawaii, Puerto IUco, and Alasb please visit the Amazon Pr1me Shipping Benefits page to check various
ship ping optionS.

46.

Separate from the UPDP, various Prime upsells appear as elements within the

online checkout flow, which itself appears in various versions to consumers depending on factors
AMENDED COMPLAINT
Case No. 2:23-cv-0932-JHC

15

Federal Trade Commission
600 Pennsylvania Ave., NW
Washington, DC 20580
(202) 326-3320

Case 2:23-cv-00932-JHC Document 67 Filed 09/20/23 Page 16 of 92

1

(i.e., whether a consumer has previously declined a Prime upsell). There are three desktop

2

checkout flow variations: a) the Shipping Option Select Page, b) the Single Page Checkout page,

3

and c) the True Single Page Checkout.

4

47.

SOSP on Desktop. The Shipping Option Select Page sought to enroll consumers

5

in Prime by providing them a series of shipping options, with estimated delivery dates, and pre-

6

selecting the fastest shipping option, which also enrolled consumers in Prime. The upsell

7

promised, for example, “FREE Same-Day Delivery” and a “30-day FREE trial of Prime,” but

8

failed to disclose Prime’s price or the fact that the subscription service would renew

9

automatically. The SOSP provided only a belated, inconspicuous disclosure of the terms of

10

Prime membership.

11

48.

In particular, the SOSP checkout flow on desktop began with a page where the

12

consumer could check out, followed by a page to select or input a shipping address, and then a

13

“Choose your shipping options” page, where consumers selected their shipping options for the

14

items they were purchasing. See Attachment G, at 3–4. This page displayed the different

15

shipping options, including speed and price. The SOSP shipping options page preselected the

16

first option—“FREE Same-Day Delivery with a free trial of Amazon Prime”—which would

17

enroll the consumer in Prime. If the consumer did not want free shipping with Prime, the

18

consumer needed to select another option to avoid a Prime membership. Above the shipping

19

options, Amazon displayed an orange banner stating “Good news [name], we’re giving you a 30-

20

day FREE trial of Prime.” The page did not show the price of a Prime subscription, nor did it

21

disclose the monthly auto-renewal. See Attachment G, at 4.

22
23

AMENDED COMPLAINT
Case No. 2:23-cv-0932-JHC

16

Federal Trade Commission
600 Pennsylvania Ave., NW
Washington, DC 20580
(202) 326-3320

Case 2:23-cv-00932-JHC Document 67 Filed 09/20/23 Page 17 of 92

1

Choose a dellvery option :

2

I

3

Good news Test, we're giving yoo a JO-day FREE bill of Prime

@ Te>doy
FREE S.,

4

0

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0 To1hy 2PM - 6PM
$12 99

l,xt~~t O b\'ot 14th () n1 21>2:0 r lea ) I
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with Alua I c •rm '

T,o day

$4 ,_99 & FREE R@TI.nl! v

rREE S:im~ D,:if Dl!lr.f!ry itli '),at.r Fri!~ trial c;f Prime

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9 blt1! l1by P'(kup locations

2

Payment method

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ai, •lupplno Mklteu

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5

Offers

4

6

Review it em s a nd sh ipping

-

Te.st. we're giving you Prime FREE for 30
days!

7

Get )'OU' Ptlme elio,tJ&e Items tor ~ FREE.

Delivery: Dec.17, 2.022 19youCM"de,lntheoe-.1 51~•nd4t mlrMe(Deu!IJI
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,pl>ff from A~on com

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Kind le Pap.-whita (I GI i - Mrtw w it h a
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days!

6

ao ,me.

Get your Prime eligible items '4011d11y, Bee:. 19 ~y 8Pt4
Tomorrow, Dec. 1S by 8PM for -$S,9g FR

7
8

Delivery: Dec. 19, 2022
Items shipped from Amazon.com

9

Amc1zon Basics Woodcased #2 Pencils,

Choose a delivery option:

Pre-sh rpened, HB Lead • Box of 1 50,

0 FREE O ne-Day Delivery w ich your free trf I of Pri me

Bulk Box

Fast, FREE Delivery
@ Monday, Dec. 19

10

$9.S5 & FREE Returns "

11

Sold by Am.11:on .com StrV>c 3 LLC
Subsc ribe & Save:
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$5.99 - Shipping

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$9.99 - Fa est Deli very

deliveri es "
De live ry eve ry: 3 months (most

common )

13

mazQn Prime eliqlblc Ju•n now

ft Atld 91 h OPflOOS

14
15
16
17

77.

Since at least 2018, Prime upsells on the mobile checkout flow have mirrored

those on desktop checkout, and have included the SOSP, UPDP, and the SPC.
78.

Navigating Prime upsells on mobile devices is more difficult than on a desktop.

18

Amazon often places material terms such as price and auto-renewal terms at the very bottom of

19

the mobile page—past the point viewable on the screen unless the consumer scrolls down—

20

where consumers are least likely to see this information. On mobile devices, consumers are also

21

more likely to select a prominent option without scrutinizing fine print.

22
23

AMENDED COMPLAINT
Case No. 2:23-cv-0932-JHC

28

Federal Trade Commission
600 Pennsylvania Ave., NW
Washington, DC 20580
(202) 326-3320

Case 2:23-cv-00932-JHC Document 67 Filed 09/20/23 Page 29 of 92

1

79.

Mobile (Past). The mobile Shipping Option Select Page contained similar

2

problematic elements to the desktop SOSP, including the pre-selection of a fast-shipping option

3

that would enroll consumers in Prime and a belated, inconspicuous disclosure of the terms of

4

Prime membership.

5

80.

The mobile SOSP (like the desktop SOSP) began with the “shipping option”

6

selection page. The first, pre-selected option was “FREE Same-Day Delivery with Amazon

7

Prime.” Three other shipping options, which were not preselected and would not enroll the

8

consumer in Prime, are further below. See Attachment L, at 4.

9

amaion
_ ,

10

Choose you r sn ipping options
,ho t4th G~n) 1lll'rth prami um ~Dund, MIIJ:plng

1-

T~"4
$U.!lo9 - F•rt~t Ocli..,ry

Conlirf'..J C

17
18

-

81.

After clicking “Continue,” the consumer proceeded to “payment method” pages

19

to select the payment method. See Attachment L, at 5-6. As on desktop, the “payment method”

20

page did not mention Prime, even though Amazon will charge this payment method for Prime.

21
22
23

AMENDED COMPLAINT
Case No. 2:23-cv-0932-JHC

29

Federal Trade Commission
600 Pennsylvania Ave., NW
Washington, DC 20580
(202) 326-3320

Case 2:23-cv-00932-JHC Document 67 Filed 09/20/23 Page 30 of 92

1

82.

After selecting payment information, the consumer proceeded to a UPDP page

2

that stated at the top: “[Name], we’re giving you 30 days of Prime for $12.99 FREE.” See

3

Attachment L, at 7. The mobile page then listed several “shopping benefits” (e.g., “Prime

4

Delivery” and “Exclusive Deals”) and “entertainment benefits” (e.g., “Prime Video” and “Prime

5

Music”). Below these Prime benefits was a yellow button, “Start your Prime FREE trial,” with

6

black text beneath it, “Don’t worry, cancel anytime.” The yellow button enrolled the consumer

7

in Prime. Below that was a white button: “No Thanks,” which declined Prime. To this point on

8

the screen (and prior screens), Amazon had not disclosed that Prime will auto-renew once the

9

free trial expired, or that it costs $12.99 per month.

_.,

10

amazon
Prime Viidieu

11

Wato:n wtlit: JOO LCJ""

Test, 'We're giving you J O days of
Prim e tor $12:-.99 f RiBE

12

11C)PiPINI!, i,U'll!I/Flli , IN

ll

W-s aid everyday
11"1;."11.JJ

18
19

83.

Na Thanks

Finally, beneath “No Thanks,” located within terms and conditions were Prime’s

20

auto-renewal terms and monthly cost. To view this text, many consumers would need to scroll

21

down on their mobile device. See Attachment L, at 7.

22
23

AMENDED COMPLAINT
Case No. 2:23-cv-0932-JHC

30

Federal Trade Commission
600 Pennsylvania Ave., NW
Washington, DC 20580
(202) 326-3320

Case 2:23-cv-00932-JHC Document 67 Filed 09/20/23 Page 31 of 92

1

84.

If the consumer selected “Start your Prime FREE trial,” Amazon enrolled the

2

consumer in Prime and took the consumer to the final “checkout” page. Text toward the top of

3

the page read: “Congratulations, your Prime free trial has started!” The page did not state

4

Prime’s price or that the subscription would auto-renew. At this point, even if the consumer

5

abandoned the cart without completing checkout, Amazon still enrolled them in Prime. There

6

was no option on the “checkout” page for the consumer to cancel or undo their Prime

7

subscription. See Attachment L, at 8.

8
9
10

85.

The Universal Prime Decision Page on mobile devices contained similar

problematic elements as the UPDP on desktop.
86.

The UPDP on mobile (like the desktop version) required consumers to either

11

accept or decline a Prime subscription before allowing them to continue shopping. See

12

Attachment M. The mobile UPDP failed to make clear that the consumer would enroll in Prime

13

by selecting “Get FREE two-day shipping.” The mobile UPDP disclosed some terms, but only

14

at the bottom of the screen in a block of small print text, which stated “If you do not wish to

15

continue for $12.99/month plus any applicable taxes, you may cancel anytime by visiting Your

16

Account and adjusting your membership settings.”

17
18
19
20
21
22
23

AMENDED COMPLAINT
Case No. 2:23-cv-0932-JHC

31

Federal Trade Commission
600 Pennsylvania Ave., NW
Washington, DC 20580
(202) 326-3320

Case 2:23-cv-00932-JHC Document 67 Filed 09/20/23 Page 32 of 92

__,_

1

amazon

2

QgescpqHnb , we are giving you a 30-day
free trial of Amazon Prime. Save S5.99
with FREE Two-Day Shipping on this
order.

3
4
5

____

Delivery Speed

..,
prime

Same-Day Delivery (in select cities)

FREE

One-Day Shipping (in select cities)

FREE

Two-Day Shipping

FREE

6

No m inimum order threshold
for FREE Two-Day Shipping

Get FREE Two-Day Shipping

7

No thanks, I do not want FREE Two-Day

Shipping

8

By signing up, you acknowledge that you have read and
agree to the Amazon Prime Terms and Conditions and
authorize us t o charge you r credit card (Visa ····-0988)
or another available credit card on file after your 30-day

9

free trial. Your Amazon Prime membership cont inues
until cancelled. If you do not wish to continue fo r
$12.99/month plus any applicable taxes, you may
cancel anytime by visiting Your Account and adjusting

10

your membership settings.

11

87.

12

as SPC on desktop.

13

88.

The Single Page Checkout on mobile also contained similar problematic elements

Mobile SPC, like mobile SOSP, began with a “shipping options” page that

14

included an option for “FREE Two-Day Delivery with Amazon Prime,” and several other non-

15

Prime shipping options. See Attachment N, at 3-4. The consumer then enters payment

16

information. See Attachment N, at 5-6.

17

89.

If the consumer selected one of the non-Prime shipping options (and after

18

selecting a payment method), the consumer proceeded to the checkout page and encountered two

19

Prime upsells. First, consumers could enroll in Prime if they selected “Try Prime FREE . . .

20

we’re giving you a 30-day FREE trial of Amazon Prime. No commitments, cancel anytime.”

21

See Attachment N, at 7. Second, under “Shipment details,” consumers could select (among

22
23

AMENDED COMPLAINT
Case No. 2:23-cv-0932-JHC

32

Federal Trade Commission
600 Pennsylvania Ave., NW
Washington, DC 20580
(202) 326-3320

Case 2:23-cv-00932-JHC Document 67 Filed 09/20/23 Page 33 of 92

1

other, non-Prime options) “FREE Same-Day Delivery with your free trial of Prime. Fast FREE

2

Delivery.” The page does not disclose Prime’s price or its auto-renewal feature.
90.

3

If the consumer selected the option for a Prime free trial, the consumer proceeded

4

to an updated version of the checkout page that read: “[Name], your Prime FREE 30-day trial

5

has been added below,” and in smaller font below stated Prime’s price and auto-renewal feature.

6

See Attachment N, at 8. Further below, Amazon added Prime to the consumer’s cart for

7

purchase, listing the price of the free trial as $0.00 and the “quantity” as “1.” To remove Prime

8

from the purchase, the consumer needed to select the dropdown menu and change the product

9

quantity from “1” to “0.”

10
11
12

91.

Mobile (Current). In 2022, Amazon modified the mobile checkout enrollment

92.

The current mobile upsells contain many of the same problematic elements as the

flow.

13

prior mobile upsells—including misleading language and manipulative designs—which lead

14

consumers to enroll in Prime without their consent.

15

93.

Consumers using mobile devices to navigate to Amazon.com can select a product

16

by clicking a large yellow button (“Add to Cart”), and continue shopping, or a large orange

17

button (“Buy Now”) to proceed directly to the checkout. See Attachment O, at 1. Consumers

18

who continue shopping add additional products to their cart by clicking the large yellow “Add to

19

Cart” button, until they finish and choose another large yellow button (“Proceed to checkout”),

20

which takes the consumer to the next step. See Attachment O, at 2.

21
22
23

AMENDED COMPLAINT
Case No. 2:23-cv-0932-JHC

33

Federal Trade Commission
600 Pennsylvania Ave., NW
Washington, DC 20580
(202) 326-3320

Case 2:23-cv-00932-JHC Document 67 Filed 09/20/23 Page 34 of 92

94.

1

At this point, the consumer signs in (if the consumer has not already) and clicks a

2

large yellow “Continue” button to proceed to a mobile UPDP. Consumers who have already

3

signed in proceed directly to the mobile UPDP.
95.

4

Consumers without an account must create one before reaching the mobile UPDP.

5

Creating an account involves four steps: entering an email address, creating a password, and

6

adding an address and a payment method. See Attachment O, at 3-4. Completing these steps

7

takes the consumer to the mobile UPDP.
96.

8

When a consumer reaches the mobile UPDP, Amazon divides the page, with a

9

footer (sometimes known as a “sticky footer”) that occupies the screen’s bottom half, rendering

10

only a portion of the top half visible unless the consumer scrolls down. See Attachment O, at 5.

11

-

ama.zon

12
.n~

,r lflr' illirimn, ..Ii

13
14
15
16

"

w •r;p giving1you 30 d,ay~ of
P, i11n for FREE

A.1

your

Wllhou'l Prlm1,

r

Tl

17
18
19
20

Get F

Two•Oay Oel.t~r:,r wl h Pr•me

Salil! S5.99 , m

ntl!,' en th llrffi!r

21
22
23

n
AMENDED COMPLAINT
Case No. 2:23-cv-0932-JHC

34

Federal Trade Commission
600 Pennsylvania Ave., NW
Washington, DC 20580
(202) 326-3320

Case 2:23-cv-00932-JHC Document 67 Filed 09/20/23 Page 35 of 92

1

97.

At the top of the mobile UPDP, Amazon informs the consumer that “we’re giving

2

you 30 days of Prime for FREE.” See Attachment O, at 5. Smaller text below reads: “After

3

your FREE trial, Prime is just $14.99/month,” but does not reference Prime’s auto-renewal

4

feature. Consumers can view this section without scrolling.

5
6
7
8
9

98.

The sticky footer on the lower half of the screen contains double-stacked buttons:

10

the top yellow “Get FREE Two-Day Delivery with Prime” button and an image appearing to be a

11

gray lower button labelled “Save $5.99 instantly on this order.” See Attachment O, at 5.

12

Amazon enrolls consumers who click the yellow button in Prime. As such, a consumer can

13

enroll in Prime without viewing the portion of the page that the sticky footer hides.

14
15

et F

16

s

el.N ry

-

me

5..99

17
18
19
20
21
22
23

AMENDED COMPLAINT
Case No. 2:23-cv-0932-JHC

35

Federal Trade Commission
600 Pennsylvania Ave., NW
Washington, DC 20580
(202) 326-3320

Case 2:23-cv-00932-JHC Document 67 Filed 09/20/23 Page 36 of 92

1

99.

If a consumer scrolls down, Amazon shows consumers a table comparing the

2

“Perks of Prime” with “Without Prime.” See Attachment O, at 5. For instance, perks of Prime

3

include “Fast, FREE delivery on Prime eligible items,” “[a]ll the music + top podcasts ad-free on

4

Amazon Music,” and “Prime Video – Enjoy award-winning Amazon Originals, movies and TV

5

shows” whereas without Prime, a consumer has “[m]inimum order requirements,” “[m]usic

6

listening with ads,” and Prime Video “[n]ot included.”

-

7
8
9

30

10
11
12
13
14
15
16
17
18
19
20
21
22
23

AMENDED COMPLAINT
Case No. 2:23-cv-0932-JHC

36

Federal Trade Commission
600 Pennsylvania Ave., NW
Washington, DC 20580
(202) 326-3320

Case 2:23-cv-00932-JHC Document 67 Filed 09/20/23 Page 37 of 92

1

100.

The following text is visible at the bottom of the sticky footer, in the smallest type

2

on the screen: “By signing up, you acknowledge that you have read and agree to the Amazon

3

Prime Terms and . . . See all.” See Attachment O, at 5. If the consumer continues scrolling,

4

additional information about Prime’s “Terms and Conditions” and “Shipping Benefits” becomes

5

visible in small text beneath the “No thanks” link. A sentence in the middle of this additional

6

text reads: “Your Amazon Prime membership continues until cancelled. If you do not wish to

7

continue for $14.99/month plus any applicable taxes, you may cancel anytime by visiting Your

8

Account and adjusting your membership settings.”

9

Fast, FREE delivery on
Prim e eligible items

Minimum order
requ irements

10

All the music + top podcasts
Music listening with ads

ad-free on Amazon Music

Not included

Prime Video - Enjoy award-

11

fi

12

winning Amazon Originals,
movies and TV shows

13
Use my gift card balance, when ava ilable,
to pay fo r Prime.

14

Get FREE Two-Day Delivery with Prime

15

Save $5 .99 inst antly on thi s order

16

No thanks

17

By sign in g up, you acknowledge that you have read
and agree t o the Amazon Prime Terms and
Conditions and authorize us to charge your defa ult
payment method (Visa '"'- 3947) or another
availab le payment m ethod on file after your 30-day
free trial. Your Amazon Prime membership

18

continues until cancelled. If you do not wish to
continue for $14.99/month plus any applicable
taxes, you may cancel anytime by visiting Your
Account and adjusting your membership settings.

19
20

For custo mers in Hawaii, Puerto Rico, and Alaska
please visit the Amazon Prime Shippinq Benefits
i amazon. com

21
22
23

AMENDED COMPLAINT
Case No. 2:23-cv-0932-JHC

37

Federal Trade Commission
600 Pennsylvania Ave., NW
Washington, DC 20580
(202) 326-3320

Case 2:23-cv-00932-JHC Document 67 Filed 09/20/23 Page 38 of 92

1

101.

If a consumer clicks the downward arrow on the top right of the sticky footer,

2

Amazon also reveals the additional text beneath the “No thanks” link. The arrow is adjacent to

3

the yellow “Get Free Two-Day Delivery with Prime” button that will enroll the consumer in

4

Prime. If a consumer clicks the button while attempting to click the adjacent sticky footer arrow,

5

Amazon enrolls the consumer in Prime.

6
7
8
9
10
11

102.

Consumers cannot view the full text beneath the “No thanks” link without

12

scrolling or clicking the sticky footer arrow. However, consumers can enroll in Prime by

13

selecting the large yellow “Get FREE Two-Day Delivery with Prime” button without scrolling.

14

See Attachment O, at 5.

15
16
17

103.

Consumers can proceed with their purchase if they select either the yellow button

or the blue “No thanks” link. See Attachment O, at 5.
104.

If the consumer selects the yellow “Get FREE Two-Day Delivery with Prime”

18

button, Amazon brings the consumer to a final page with a yellow “Place your order” button and

19

“Congratulations, your Prime free trial has started! We’ll email you about all Prime benefits”

20

underneath. Therefore, Amazon enrolls the consumer in Prime before the consumer has even

21

placed the order. The final page of the flow also contains an “Order Total” that does not include

22

Prime’s price. See Attachment O, at 6.

23

AMENDED COMPLAINT
Case No. 2:23-cv-0932-JHC

38

Federal Trade Commission
600 Pennsylvania Ave., NW
Washington, DC 20580
(202) 326-3320

Case 2:23-cv-00932-JHC Document 67 Filed 09/20/23 Page 39 of 92

1

105.

On this final page, the consumer can change or confirm shipping and billing

2

information, remove products from the cart, and make other changes such as adding gift receipts

3

or providing delivery instructions. See Attachment O, at 6. The consumer can also select a

4

shipping method.

5

106.

The yellow button labelled “Place your Order” allows consumers to make their

6

purchase. See Attachment O, at 6. Prime’s price and auto-renewal feature do not appear on the

7

page, the consumer cannot remove Prime, and the consumer cannot back up and choose “No

8

thanks” to Prime on the prior page.

9

107.

In each pathway (UPDP, SOSP, SPC, TrueSPC, and mobile), Amazon fails to

10

provide clear and conspicuous disclosures regarding the Prime subscription program’s material

11

terms: its price, and the fact that it renews automatically unless the consumer affirmatively

12

cancels. Furthermore, in each pathway (UPDP, SOSP, SPC, TrueSPC, and mobile), Amazon

13

does not provide any disclosures at all before Amazon collects billing information from

14

consumers.

15

108.

Prime Video. Prime Video is a distinct product from Prime. Specifically, Prime

16

Video is a subscription-based video streaming service. Although it is possible to sign up for

17

Prime Video alone, it is difficult to do so.

18
19
20

109.

Amazon’s webpage tricked consumers into signing up for Prime instead of Prime

Video, which would be a lower-cost option.
110.

In particular, Amazon initially offers Prime Video as part of the full, more

21

expensive Prime package to consumers who reach the Prime Video homepage (or “storefront”)

22

to enroll in Prime Video. See Attachment P, at 1.

23

AMENDED COMPLAINT
Case No. 2:23-cv-0932-JHC

39

Federal Trade Commission
600 Pennsylvania Ave., NW
Washington, DC 20580
(202) 326-3320

Case 2:23-cv-00932-JHC Document 67 Filed 09/20/23 Page 40 of 92

1
2
3
4
5
6
7
8
9
10
111.

11

Capitalizing on some consumers’ inability to appreciate the difference between

12

“Prime” and “Prime Video,” the Prime Video enrollment process fails to clarify Amazon will

13

enroll them in Prime rather than the less expensive Prime Video, on both desktop and mobile

14

platforms. This causes some consumers to enroll in Prime, rather than Prime Video,

15

unknowingly.
112.

16
17

Consumers can reach the Prime Video storefront through various ways, including

by searching “Prime Video” in an online search engine or the Amazon search bar.
113.

18

The initial Prime Video storefront displays the Prime Video logo at the top and an

19

orange button labelled “Watch with Prime. Start your 30-day free trial.” See Attachments P and

20

V.

21
22
23

AMENDED COMPLAINT
Case No. 2:23-cv-0932-JHC

40

Federal Trade Commission
600 Pennsylvania Ave., NW
Washington, DC 20580
(202) 326-3320

Case 2:23-cv-00932-JHC Document 67 Filed 09/20/23 Page 41 of 92

1

114.

Amazon brings consumers who press the orange button to a second page and

2

prompts them to sign in (if they have an Amazon account) to confirm billing information, or to

3

create an account and submit billing information. This page also contains small print links to the

4

Amazon Prime Conditions of Use and Privacy Notice at the bottom of the page. See Attachment

5

V, at 2-5.

6
7

115.

Amazon does not, to this point, present the consumer with any marketing

regarding Prime, as opposed to Prime Video.

8

116.

After sign in or account creation, Amazon brings consumers to a page containing,

9

from top to bottom:

10

(a)

11

trial”;

12

(b)

the email associated with the account;

13

(c)

a table with “Confirm your details” at the top followed by the plan type,

14

which is “Prime. Enjoy unlimited streaming of thousands of movies and TV

15

shows plus FREE Two-Day Delivery on millions of items. $14.99/month after

16

trial” (to get Prime Video rather than Prime, the consumer must click a gray

17

“change” box to the right);

18

(d)

the consumer’s email, payment method, and billing address;

19

(e)

at the bottom, “By signing up, you acknowledge that you have read and

20

agree to the Amazon Prime Terms and Conditions and authorize us to charge your

21

preferred card or another available credit card on file after your 30-day free trial.

22

Your Prime membership continues until cancelled. If you don’t want to continue

23

the Prime logo with “Watch now, cancel anytime. Start your 30-day free

AMENDED COMPLAINT
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Case 2:23-cv-00932-JHC Document 67 Filed 09/20/23 Page 42 of 92

1

for $14.99/month plus any applicable taxes, you may cancel anytime by visiting

2

Your Account and adjusting your membership settings;” and

3

(f)

4

The button sits immediately above a gray area with text reading “Change or

5

cancel plan anytime. Pay later.” See Attachment P, at 2 and Attachment V, at 6.

an orange button in the bottom right corner, labelled “Start your free trial.”

6
7

Sta rt you r 30-day free t ri al

8

Confirm your deta iIs

9

Pr•M!'

:nf::,y uru'1lli:41::I ::.:rc.rn r'3 ar ih~n~ al lflO, es ;,,'lei IV ~ha...s. p.J:. f-k:::
1W'v D.>1 Ori 'lef I Of", rT"II O'IS. ~ lt("'IG
1.11.111

,s 11-=i:::a1:"JD'l1:ti.1 1 !

10

fnldil

tc· 1-

11

MJ.A:rt..lrd c t..!11'S n ! !: 1

12

Llorr-icstc

13

filB1•~"i-c1lO.t

10'202

~w--_.:;ru.i.ci,,\·1;,.
5UTTLE

,,.

.,.,.:.1..111•~J.J.,V...k~,..,.CO~t:..tl,',)uhJ'll:t'61lJ ...,1J J 1~l.ll+'it::"1

14

p•c'c• ·cc r..J"d,:, .a:KJ

·e' .11,J

i.',Jj!-"111

II JI

J.

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,1·d.,:,uhL1~~~lt.1J

4'-

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z.:k.! t1L"_jlr..J1dcn tt c .if~r ,-... u .SU .i.,,.·~•e,;,: t u roi.-Prlm~mcmbc

+

L........o

~•d the book lh.lt il'!lpir~ th~ mc:J"llic!

8
9
10

119.

After receiving the June 30, 2022 CID, Amazon changed the Prime Video

11

enrollment flow for Prime. Now, when consumers click “Start your free trial” Amazon shows at

12

least some consumers a page titled “Welcome to Prime, [name]” that describes certain Prime

13

membership services. On this page, there is no option to cancel the Prime membership. Toward

14

the bottom are two buttons: on the left “Discover Prime benefits” (gray button) takes consumers

15

to an overview of Prime-related services, and on the right “OK” (blue button) continues to the

16

Prime Video storefront. See Attachment V, at 7-8.

17
18
19
20
21
22
23

120.

Prime Video (Mobile). Consumers may also enroll in Prime through Prime

Video on a mobile device.
121.

Like Prime Video on desktop, Prime Video on mobile tricked consumers into

signing up for Prime instead of Prime Video, which would be a lower-cost option.
122.

Like desktop Prime Video, the Prime Video mobile storefront displays the Prime

Video logo at the top and, toward the bottom of the page, an orange button labelled “Watch with
AMENDED COMPLAINT
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Case 2:23-cv-00932-JHC Document 67 Filed 09/20/23 Page 44 of 92

1

Prime. Start your 30-day free trial.” Above the orange button, in blue text, reads “Prime” and

2

then, in white text, “Watch for $0.00 with Prime.” See Attachment U, at 1.

3
4
5
6
7
8
9
10
11
12
13
14

123.

Amazon brings consumers who press the orange button to a “Welcome” page to

15

sign in (if they have an Amazon account) to confirm billing information, or to create an account

16

and submit billing information. The page also contains links to “Amazon’s Conditions of Use

17

and Privacy Notice.” See Attachment U, at 2.

18

124.

After sign in or account creation, Amazon then brings consumers to a page that

19

asks consumers to “Confirm your details,” and includes the following information from top to

20

bottom:

21

(a)

22

movies and TV shows plus FREE Two-Day Delivery on millions of items.

23

Next to “Plan” reads: “Prime. Enjoy unlimited streaming of thousands of

AMENDED COMPLAINT
Case No. 2:23-cv-0932-JHC

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Case 2:23-cv-00932-JHC Document 67 Filed 09/20/23 Page 45 of 92

1

($14.99/month after trial).” Next to this text is an arrow similar to a greater-than

2

sign (“>”).

3

(b)

4

information.

5

(c)

6

Prime’s price and auto-renewal feature.

7

(d)

8

text beneath: “Change or cancel plan anytime. Pay later.” See Attachment U, at 5.

The page also lists consumer’s email, payment method, and billing address

There is then a link to Amazon Prime terms and conditions, as well as

Toward the bottom is an orange button “Start your free trial” with black

-~

9

prime

10

Confirm your details
Piao

11

Prime

Enjay ul'l-im,ted stream ng of
tha.r:.ands. of movies .and TV

>

shows l]lJs l'!lEE Two-Ody
D li•.tery on millt:Jns of item s.

12

($14.9 3/n,011,r.attor tM II

tm:;1il

13

>

14

be used w.-.er1 a·,.adat,&eJ

>

BiUing

15

.address

16
By sig l)ing u.D. you acknowledge tra;; you have read
Jnd;i,gtt'C to ~ A.rr,:i70'1, Pn.me TC111n,; ,1nrl (ood Hor1,;
onO ~uthO Amazon Prime >

12

You can end your Prime membersh ip by selecting the End Membership button on
this page.

End You r Amazon Prime Membership

13

Pa id members who haven't used th e ir benefits are eligible fo r a fuU
refun d of the rurren t m e m bership period. We'll process. t he refu nd in
th ree t o fi ve business days.

14

End Yo u r· Prirne Membershi p

15

• Additiona l s ubscriptions t ied to yo ur member.ihip won 't renew once you r Prime
me m bership ends.
• If yo ur Prime me m be rsh ip 1s associated with a service you recerve t hro ug h an other
company (such as Sp rint), con t act that comp.any to m a nag f! you r Prime me m bers hip.
• Customers w ho sig n up fo r Amazon Pri me using the And roid mobile shopping app must
mana ge t he ir s u bscripti o n t h rough Go ogle Subscript io n services.

16
17

To en d yo ur Amazon Prime me mber:ship:
1. Go to your Prime membe rship.
2.. Se lect Up da t e, C.1: nce l, ;;m d m o re , an d f o llow the on- ~c reen inst ructions.

18
19

137.

The search bar pathway to the Iliad Flow varied somewhat depending on what

20

search the consumer ran. For instance, searching “how to turn off Prime,” or “cancel prime”

21

(rather than “how to cancel Prime”) took the consumer to a page with a link to Prime Central,

22

from which the consumer had to then locate the path to the Iliad Flow. Searching “End

23

AMENDED COMPLAINT
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Case 2:23-cv-00932-JHC Document 67 Filed 09/20/23 Page 50 of 92

1

Membership” took the consumer to a page with three blue links under the heading “Closing your

2

Amazon account,” and a subheading “Get information on how to close your Amazon account.”

3

The middle link was “cancel membership.” Clicking “cancel membership” did not cancel

4

membership. Instead, it took the consumer to the Iliad Flow.

5
6
7

138.

Typing “cancel membership” in the search bar on a mobile device brought the

consumer to the Iliad Flow through similar steps. See Attachment S.
139.

Thus, to reach the Iliad Flow, consumers had to do one of the following: 1)

8

contact customer service and inform a customer service agent that they wanted to cancel and

9

click the cancellation link the customer service agent provides; 2) navigate from Amazon.com to

10

the Prime account management page (Prime Central), locate the “manage membership”

11

dropdown, and press a button labelled “End Membership”; or 3) search “How to cancel

12

membership” in the Amazon search bar, then move through subsequent steps to reach the Iliad

13

Flow—frequently, selecting a link reading “End Your Amazon Prime Membership” and then

14

pressing a button reading “End Your Prime Membership.”

15

140.

Once consumers reached the Iliad Flow, they had to proceed through its

16

entirety—spanning three pages, each of which presented consumers several options, beyond the

17

Prime Central page—to cancel Prime. See Attachment Q.

18

141.

On the first page of the Iliad Flow, Amazon forced consumers to “[t]ake a look

19

back at [their] journey with Prime” and presented them with a summary showing the Prime

20

services they used. Amazon also displayed marketing material on Prime services, such as Prime

21

Delivery, Prime Video, and Amazon Music Prime. Amazon placed a link for each service and

22

encouraged consumers to access them immediately, i.e., “Start shopping today’s deals!”, “You

23

AMENDED COMPLAINT
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1

can start watching videos by clicking here!”, and “Start listening now!” See Attachment Q, at 3.

2

Clicking on any of these options took the consumer out of the Iliad Flow.

3
4
5
6
7
8
9

142.

Also, on page one of the Iliad Flow, Amazon presented consumers with three

10

buttons at the bottom. “Remind Me Later,” the button on the left, sent the consumer a reminder

11

three days before their Prime membership renews (an option Amazon had already presented the

12

consumer once before, in the “Manage Membership” pull-down menu through which the

13

consumer entered the Iliad Flow). The “Remind Me Later” button took the consumer out of the

14

Iliad Flow without cancelling Prime. “Keep My Benefits,” on the right, also took the consumer

15

out of the Iliad Flow without cancelling Prime. Finally, “Continue to Cancel,” in the middle,

16

also did not cancel Prime but instead proceeded to the second page of the Iliad Flow. See

17

Attachment Q, at 3. Therefore, consumers could not cancel their Prime subscription on the first

18

page of the Iliad Flow.

19
20
21
22
23

AMENDED COMPLAINT
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1

143.

On the second page of the Iliad Flow, Amazon presented consumers with

2

alternative or discounted pricing, such as the option to switch from monthly to annual payments

3

(and vice-versa), student discounts, and discounts for individuals with EBT cards or who receive

4

government assistance. Amazon emphasized the option to switch from monthly to annual

5

payments by stating the amount a consumer would save at the top of this page in bold. Clicking

6

the orange button (“Switch to annual payments”) or the links beneath took the consumer out of

7

the Iliad Flow without cancelling. See Attachment Q, at 4.

8

Get all the benefits of Prime for less

9

We'd like to offer you the chance o enjoy all the benefits of Prime for only

$139/year.

10
11

Are you

12
13

rtudont?

Hdve a11 EBT card/recei, govemment 5Sinance?

144.

Right above these alternatives, Amazon stated “Items tied to your Prime

14

membership will be affected if you cancel your membership,” positioned next to a warning icon.

15

See Attachment Q, at 4.

16

145.

Amazon also warned consumers that “[b]y cancelling, you will no longer be

17

eligible for your unclaimed Prime exclusive offers,” and hyperlinked to the Prime exclusive

18

offers. See Attachment Q, at 4. Clicking this link took the consumer out of the Iliad Flow

19

without cancelling.

20
21

Items tied to your Prime membership w·u be affected if you c
1. By ca celling, you will no longer

c l your membership.

ligible for your uncl imet:I Prime uclusive offers.

22
23

AMENDED COMPLAINT
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146.

1

Finally, at the bottom of Iliad Flow page two, Amazon presented consumers with

2

buttons offering the same three options as the first page: “Remind Me Later,” “Continue to

3

Cancel,” and “Keep My Membership” (labelled “Keep My Benefits” on the first page). See

4

Attachment Q, at 4. Once again, consumers could not cancel their Prime subscription on the

5

second page of the Iliad Flow. Choosing either “Remind Me Later” or “Keep My Membership”

6

took the consumer out of the Iliad Flow without cancelling. Consumers had to click “Continue

7

to Cancel” to access the third page of the Iliad Flow.
147.

8

On the third page of the Iliad Flow, Amazon showed consumers five different

9

options, only one of which, “End Now”—presented last, at the bottom of the page—

10

immediately cancelled a consumer’s Prime membership. See Attachment Q. Pressing any of the

11

first four buttons took the consumer out of the Iliad Flow without immediately cancelling.
148.

12

On the third page of the Iliad Flow, the first and second options—“Remind Me

13

Later” and “Keep My Membership”—were substantially identical to the buttons on the Iliad

14

Flow’s first two pages. Therefore, Amazon forced consumers who reach the Iliad Flow’s last

15

page to view the “Remind Me Later” option four times (including once to enter the Iliad Flow)

16

and the “Keep My Membership” option three times. See Attachment Q, at 5.

17

Vou

ul

ing:

18
19
20
21
22
23

AMENDED COMPLAINT
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1

149.

The third option, “Pause on [date],” would “pause” or put on hold—but not

2

cancel—a consumer’s Prime membership. Amazon did not charge “paused” members for Prime

3

but made it simple for “paused” members to re-join Prime through a single “quick-resume” click.

4

Amazon presented the “pause” option adjacent to a warning icon and text stating that, “[b]y

5

pausing, [consumers] will no longer be eligible for [their] unclaimed Prime exclusive offers,”

6

and provided links to “Prime exclusive offers” (which if clicked exit the Iliad Flow without

7

canceling). See Attachment Q, at 5.

8

aus yo1J Prime m m

9

511ip:

to yo-,.-

10

rime mcmben ip

d rf

au

u e your m

mbe hip.

II flQlon lllf~

11
12
13
14
15
16

150.

Amazon regularly sent promotional materials to “paused” members to encourage

them to un-pause Prime with a single click.
151.

Above the fourth and fifth options—the “End on [date]” and “End Now”

17

options—Amazon also added a warning icon and text that states “[b]y cancelling, [consumers]

18

will no longer be eligible for [their] unclaimed Prime exclusive offers.” See Attachment Q, at 5.

19

152.

The fourth option, “End on [date],” turned off Prime’s auto-renew feature. It did

20

not immediately cancel the consumer’s membership. Instead, the membership would end when

21

the current billing cycle concluded, and the consumer would not receive a refund. See

22

Attachment Q, at 5.

23

AMENDED COMPLAINT
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1

153.

The fifth and final option, “End Now,” immediately cancelled a consumer’s

2

Prime membership (and Amazon refunded a pro-rated amount for the balance of the billing

3

cycle). Thus, only one of the five options presented immediately cancelled a consumer’s Prime

4

membership. See Attachment Q, at 5.

5

Ca -eel yo

Prime -- m -ushlp:

6
1

7

s ie

rP

e

lP

8
9
10

End

11
12
13

154.

Therefore, to complete the Iliad Flow and cancel a Prime membership, the

14

consumer needed to click a minimum of six times from Amazon.com: Prime Central 

15

“Manage Membership”  “End Membership”  “Continue to Cancel”  “Continue to Cancel”

16

 “End Now.” See Attachment Q.

17

155.

Amazon limited refunds available through the Iliad Flow to one monthly charge,

18

although Amazon did not disclose this to subscribers entering the flow. Consequently, a

19

Nonconsensual Enrollee who discovered Prime charges after a few months could not obtain a

20

full refund online. In contrast, a consumer who called customer support and was not redirected

21

to the Iliad Flow could obtain a greater refund because customer service representatives have

22
23

AMENDED COMPLAINT
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1

discretion to provide one (for instance, if a consumer complains about Nonconsensual

2

Enrollment).

3

156.

The Iliad Flow was also accessible through a mobile device. Similar to the Iliad

4

Flow on desktop, the Iliad Flow on mobile was also difficult for consumers to locate and

5

presented a complex array of options across multiple pages. Cancelling via the Iliad Flow on a

6

mobile device was an eight-page, eight-click minimum process.
157.

7

On a mobile device, a consumer entered the Iliad Flow by 1) tapping on “My

8

Account,” 2) selecting “Manage Prime Membership” from a dropdown menu on the second

9

page, 3) selecting “Manage membership” on the third page, 4) selecting “Manage membership”

10

on the fourth page, and 5) selecting “End my Membership” on the fifth page. See Attachment R,

11

at 1-5.

12

158.

On the sixth page, the consumer seeking to cancel began the mobile equivalent of

13

the Iliad Flow. Specifically, on this page, Amazon presented benefits information similar to the

14

desktop Iliad Flow, and stated at the top of the page “[Name], thank you for being a member

15

with us. Take a look back at your journey with Prime.” See Attachment R, at 6. Amazon

16

included the same three options—“Keep My Benefits,” “Continue to Cancel,” and “Remind Me

17

Later”—although consumers had to scroll down to view them. None of these options ended the

18

Prime membership. Consumers who selected “Continue to Cancel” proceeded to a seventh page.

19

See Attachment R, at 6.

20
21

159.

On the seventh page, Amazon presented alternate payment options similar to

those in the desktop Iliad Flow: Amazon placed the three options at the bottom of the page in

22
23

AMENDED COMPLAINT
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1

the same order. See Attachment R, at 7. Pressing “Continue to Cancel” did not end the

2

membership. It took the consumer to an eighth and final page. See Attachment R, at 7.

3

160.

On the eighth and final page, Amazon presented five buttons. The first three were

4

“Pause on [date],” “Keep My Membership,” and “Remind Me Later.” The consumer had to

5

scroll down to view the fourth and fifth. The fourth (“End on [date]”) turned off auto-renew, but

6

did not immediately cancel, and consumers who chose this option did not receive a refund. Only

7

the fifth and final button (“End Now”) immediately cancelled the membership. Amazon

8

refunded consumers who pressed this button a pro-rated amount for the balance of the monthly

9

billing cycle. See Attachment R, at 8.

10

161.

Amazon designed the Iliad Flow (both desktop and mobile) to inform consumers

11

about a) Prime benefits they would lose by cancelling Prime, and b) alternative payment methods

12

available to them to keep Prime.

13

162.

Amazon did not design the Iliad Flow to be simple or easy for consumers. The

14

Iliad Flow inhibits or prevents many consumers who intend to cancel from cancelling their

15

membership.

16

163.

Amazon measured the Iliad Flow’s success based on the number of Prime

17

cancellations it prevented. In 2020,

18

enter the Iliad Flow did not cancel.

19

entered the Iliad Flow but failed to cancel subsequently used no Prime services within the next

20

thirty days.

of subscribers who clicked on “End Membership” to
of those Prime subscribers who

21
22
23

AMENDED COMPLAINT
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Case 2:23-cv-00932-JHC Document 67 Filed 09/20/23 Page 58 of 92

for the Prime Enrollment Flow

1
2

164.

Although consumers can enroll in Prime through many entry points, a majority of

3

prospective Prime members begin subscriptions by enrolling in free trials that Amazon offers

4

during its ecommerce shopping checkout process. Because these trial memberships are the

5

principal way that Amazon solicits Prime subscribers, the Prime Organization focuses

6

extensively on how Amazon presents these trials to consumers.

7

165.

Amazon’s Prime Organization regularly tests new designs for the UPDP, SOSP,

8

SPC, TrueSPC, mobile, and other elements of the checkout enrollment flow that prospective

9

subscribers see.

10

166.

11

167.

12
13
14
15

168.

16
17
18
19

169.

20
21
22
23

AMENDED COMPLAINT
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1

170.

2
3
4

171.

5
6
7
8

172.

9
10
11
12
13
14

173.

15
16
17

174.

In fact, lower-level Amazon designers, marketers, and researchers urged company

18

leadership to

One

19

Amazon employee wrote to Defendant Vice-President Jamil Ghani on July 30, 2020 about

■

20
21
22
23

An unknown $12.99 charge could mean grocery money for a family, gas to fill
up a car, or just the last bit of money to make rent. . . . Do we think that they

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should also [have] to call customer service to ask for a refund, when they
discover this unknown charge [for Prime]?

1

2
3
4

5
6

7

175.

8
9

When an Amazon program manager similarly pointed out in an email chain sent

to a large number of recipients that
Amazon Vice

11

President Cem Sibay scolded him: " [I]t's not appropriate to have this conversation over email,

12

and increasingly a mass one at that Gust adding P&C [privileged and confidential] does little)."

13

Sibay and Defendants Ghani, Lindsay, and Grandinetti failed to implement any meaningful

14

change.

15
16

has led to dark patterns and consequently Nonconsensual Emollment.
Amazon's Knowledge of Nonconsensual Enrollment

17
18

which

176.

177.

Amazon knows that Nonconsensual Emollment is widespread. In fact, Amazon

19

periodically smveys consumers who cancel Prime to detennine their reason. For example, from

20

November 2018 to Febrnaiy 2019, _

21

mean to sign up for Amazon Prime" as their " [r]eason for cancellation."

of U.S . consumers Amazon smveyed gave "I did not

22
23

AMENDED COMPLAINT
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Case 2:23-cv-00932-JHC Document 67 Filed 09/20/23 Page 61 of 92

1
2

178.

In September 2020, Amazon also performed an internal study that quantified the

number of subscribers “unaware” that they had subscribed to Prime based on five considerations:

3
4
5
6
Based on these factors, Amazon estimated that

7
8
9

Prime

subscribers were “unaware” that they had subscribed to Prime.
179.

Nonconsensual Enrollment is both so widespread and well-understood at Amazon

10

that the company’s internal documents are littered with references to “accidental” signups. One

11

company newsletter circulated among Prime Organization designers and researchers explained:

12

14

The issue of accidental Prime-sign ups is well documented . . . . Customers
unknowingly become
because 1) they signed up accidentally and/or didn’t see auto-renewal terms, 2)
we didn’t send them reminders or charge communications, and 3) they didn’t
check their card activity.

15

180.

13

In fact, as Amazon knows, consumers do not always carefully study their credit

16

card activity or notice an Amazon charge for Prime (especially when they are expecting other

17

Amazon charges for routine purchases). Consequently, as one internal memorandum explained,

18

“[i]f customers unknowingly sign up, or are unaware of auto-renew, they can go through

19

multiple billing cycles without using benefits.”

20

181.

When dissatisfied consumers call Amazon’s customer service to cancel their

21

Prime membership, customer service representatives record the reason the consumer gives.

22

Amazon studied consumers who asked to cancel their Prime membership and reported to

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customer service that they had signed up unintentionally to determine the time between when the

2

enrollment occurred and the consumer’s call. Amazon then reported the results in a

3

memorandum labelled “privileged and confidential”:
(a)

4

6

-

7

meaning that Amazon has charged them three times without consent.

8

(c)

9

meaning that Amazon has charged them six times without consent.

10

(d)

5

(b)

11
12
13
14

meaning Amazon has charged them once without consent.

182.

-

meaning that Amazon has charged them twelve times without consent.

Amazon knows who nearly all Nonconsensual Enrollees are, yet refunds only

those Nonconsensual Enrollees who eventually notice the charges and complain.
183.

Prime Organization designers and researchers referred to the design changes

15

necessary to stop Nonconsensual Enrollment as “clarity” improvements. The problem—as

16

Amazon leadership understood—was that clarity improvements reduced subscriptions and,

17

therefore, profit. One 2020 internal memorandum concerning “Prime Renewals: Product

18

Strategy for 2021” explained the tension this way: projects that improve clarity “‘right size’ the

19

member balance to intentional and genuine members, thereby being a bad guy to total Prime

20

member balance. This puts these projects at odds with other member balance accretive

21

Acquisition and Retention projects: as a result, these projects have inevitably been BTL [below

22

the line] in stack ranked prioritizations.”

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2

184.

Instead of correcting the causes of Nonconsensual Enrollment, Amazon

leadership focuses energy and investment into iterating

3
4

For example, in part to address Nonconsensual Enrollment after the fact—and without reducing

5

subscription balance—Amazon encourages Nonconsensual Enrollees to begin using the benefits

6

for which Amazon is already charging them without their consent. In a meeting with Amazon

7

designers, Defendant Lindsay was asked about Amazon’s use of dark patterns during the Prime

8

enrollment process. Lindsay explained that once consumers become Prime members—even

9

unknowingly—they will see what a great program it is and remain members, so Amazon is

10

“okay” with the situation. Accordingly, Amazon declined to remove problematic design

11

elements from its checkout enrollment flow.

12

185.

Amazon has known since at least 2016 that its Prime checkout enrollment flow

13

contains design elements that trick people into signing up. In particular, designers within the

14

Prime Organization and researchers within a separate Shopping Design Organization

15

(responsible for studying consumer complaints) knew these design elements caused

16

Nonconsensual Enrollment and urged Amazon leadership to change them. For example, in late

17

2020, designers and researchers prepared a draft memorandum explaining, in detail, Amazon’s

18

use of design techniques “designed to mislead or trick users to make them do something they

19

don’t want to do, like signing up for a recurring bill, favoring shareholder value over user value.”

20

186.

Notably, in a different 2021 draft memorandum entitled “Clarity in Prime

21

Subscription Communications” that designers and researchers prepared for Amazon executive

22

Dave Clark, the authors recounted how the Shopping Design Organization had studied “mistaken

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signups since 2016” and identified the problem “to Prime leadership.” Defendant Ghani directed

2

subordinates to revise this language because it “reads accusatory.”

3

187.

Importantly, Prime Organization and Shopping Design Organization researchers,

4

designers, and marketers prevailed upon Amazon leadership to experiment with clarity

5

improvements four times: in 2018, 2019, 2020, and 2021. Throughout the process, Amazon

6

leadership did not object to clarity improvements so long as Prime subscriptions did not fall.

7

Each time Amazon clarified the Prime enrollment process, however, subscriptions did fall. And

8

each time, Amazon leadership ordered the changes undone.
Amazon’s 2018 Decision to Defer Enrollment Process Changes

9
10

188.

Beginning in 2014, the predecessor to the Shopping Design Organization began

11

an effort to identify, study, and resolve “customer frustrations,” or consumer experience issues

12

across the entire suite of Amazon subscription services, including Prime, Kindle Unlimited,

13

Audible, and others. This effort became known within Amazon as the Customer Frustrations

14

Elimination Program (“CFEP”).

15

189.

As part of the CFEP, researchers compiled a list of user experience issues

16

identified by analyzing information consumers provided (including reasons for cancelling

17

Prime), individual customer frustration “tickets,” and observational “shop-along” research during

18

which researchers would observe customers shopping on Amazon.

19

190.

CFEP researchers created a database of consumer “frustrations” to which

20

participants across Amazon could contribute, and through which participants across Amazon

21

could search. Through the database, CFEP researchers centralized Amazon’s consumer research

22
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to facilitate collaboration between the CFEP team and the organizations within Amazon (e.g., the

2

Prime Organization) responsible for—and able to eliminate—a given “frustration.”

3

191.

Amazon measures CFEP’s performance based
In contrast, Amazon measures the Prime Organization’s performance

4
5
6
7

based on
192.

In April 2018, at the direction of Amazon’s leadership, including Defendant

Lindsay, CFEP researchers reviewed the database

8
9

193.

CFEP researchers evaluated

10
11
Through this process, CFEP researchers

12
13
14
15

194.

The Shopping Design Organization’s work overlapped with Project Lucent, a

16

Prime Organization initiative aimed at increasing clarity and reducing Nonconsensual

17

Enrollment by “simplifying cluttered templates,” phasing out “design paradigms which could be

18

confusing to the customer,” and “making the sign-up flow more intuitive,” among other goals.

19

In 2018, Defendant Lindsay received an internal memorandum regarding Project Lucent, which

20

confirmed “Prime identified the need to increase clarity during the Prime sign-up and on-

21

boarding process.”

22
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195.

1

Project Lucent researchers found the UPDP contained numerous problematic

2

elements. For example, according to the same 2018 document: (1) the button to enroll in Prime

3

“does not make it clear that consumers are signing up for Prime”; (2) the option to decline Prime

4

enrollment “is not clear/prominent so customers miss it” and click on the enrollment option

5

inadvertently; (3) Prime branding is not prominent on the UPDP “so customers did not realize

6

this was a Prime upsell”; and (4) the price of Prime and the fact that the subscription service

7

would auto-renew “was not prominent so customers did not realize the associated cost.”
196.

8

To address these problems, the Project Lucent team tested several “clarity”

9

improvements intended to clarify the UPDP on a small segment of consumers in the United

10

States.

11

197.

Specifically, Amazon changed the enrollment button from “Get FREE two-day

12

shipping” to “Start your 30-day FREE trial.” Amazon also modified the link declining Prime

13

from “Continue without fast, free shipping” to “No Thanks.” Additionally, Amazon clarified the

14

price of a Prime subscription as well as its auto-renew feature outside of the fine print terms and

15

conditions.

16

198.

Testing revealed, however, that making these clarity improvements would
In particular, the change to “Start your 30-day FREE

17
18

trial” resulted in
and the price and auto-renew clarification

19
20

the change to “No Thanks”

199.

-

On September 24, 2018, Prime and Shopping Design executives met to discuss

21

Project Lucent and the CFEP findings related to Nonconsensual Enrollment. The Shopping

22

Design Organization had no authority to implement changes within the Prime Organization’s

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area of responsibility, which includes the checkout enrollment flow. The primary question at this

2

meeting was “how many Prime signups [is] Amazon . . . willing to lose in order to prevent

3

unintended Prime Signup[.]” At the meeting, Prime Organization representatives opposed

4

changes that would reduce subscription numbers because Amazon evaluates Prime’s

5

performance substantially based on subscription numbers. Shopping Design Organization

6

researchers and leadership favored changes designed to reduce Nonconsensual Enrollment

7

because Amazon evaluates Shopping Design based partly on how many customer “frustrations”

8

it eliminates.

9

200.

10

transparency.

Executives acknowledged at the meeting that the enrollment flow lacked

11
12
13
14
15
16
17

201.

numbers, the Prime Division pulled the plug on Project Lucent.
Amazon’s 2019 Decision to Defer Enrollment Process Changes

18
19

Because the Project Lucent clarity improvements negatively affected subscription

202.

After the Prime Organization failed to address the problems in the Prime

20

enrollment flow that CFEP identified, the Shopping Design Organization escalated the issue to

21

Defendant Grandinetti, who had authority over both Organizations. Within Amazon,

22

“escalations” occur to “break ties” when two organizations within Amazon disagree.

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203.

Consistent with Amazon’s general practice, the Prime and Shopping Design

2

Organizations attempted to jointly prepare a memorandum for Grandinetti describing the testing

3

Amazon had conducted as part of Project Lucent, the work CFEP researchers performed, the

4

business implications, and the prior decision to halt changes.

5

204.

On June 17, 2019, high-level representatives of both Organizations met with

6

Defendant Grandinetti. Every member in attendance, including Defendants Lindsay and

7

Grandinetti, read the memorandum at the beginning of the meeting.

8

205.

The document identified the issue: “Prime signups are not always transparent”

9

and “customers sign up without knowing they did.” The document highlighted specific design

10

attributes contributing to Nonconsensual Enrollment. Among other things, the memorandum

11

explained that the checkout enrollment flow confused some consumers about whether they were

12

enrolling and made it difficult for them to understand Prime’s price and auto-renew feature.

13

206.

The memorandum further stated these issues were

that Amazon

14

should address, but also stated that changes to resolve those issues would cause short-term

15

enrollment to decrease.

16

207.

The attendees of the June 17, 2019 meeting discussed their options, including

17
18

on the option to decline Prime (e.g., “No Thanks, I do not want fast, FREE

19

shipping”). Defendant Lindsay even suggested something he called “scary”—that Amazon

20

should consider making it as easy to decline Prime as to enroll. The meeting participants also

21

discussed specific associated changes, such as changing the decline link to a button to make

22

consumers less likely to overlook it.

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208.

Eventually, Defendant Grandinetti vetoed any changes that would reduce

2

enrollment. He directed the Prime Organization to improve the checkout enrollment flow as

3

much as it could—but only “while not hurting signups.” Consequently, Amazon continued to

4

use the designs that caused Nonconsensual Enrollment.
Amazon’s 2020 Decision to Defer Enrollment Process Changes

5
6

209.

In 2020, product marketers and researchers on the Prime Content Experimentation

7

and Optimization team (“CE&O”) within the Prime Organization reignited “clarity” efforts to

8

improve trust (i.e., to reduce Nonconsensual Enrollment). One marketer gave a presentation on

9

clarity to Prime Organization supervisors Nahshon Davidai and Omar Kalim. The presentation

10

stated that clarity improvements would “[f]oster customer trust with straightforward messaging”

11

because the lack of clarity within the Prime checkout enrollment flow is a “root cause of

12

customer friction.” The presentation suggested that the Prime Organization had not implemented

13

proposed changes because “business goals” (paid subscriber numbers) and “customer clarity”

14

require “a delicate balance.”

15

210.

After reviewing the presentation, Davidai agreed that Amazon should replace

16

their checkout Prime upsells “with something that meets [their] clarity bar.” Accordingly, the

17

Prime Division then sought the requisite approval from Defendants Ghani and Lindsay to make

18

design changes to the checkout enrollment flow likely to reduce enrollment.

19

211.

The Prime Organization prepared a document entitled “Prime Framework for

20

Clarity” that summarized the problem and options to address it. In particular, the memorandum

21

explained that, as a result of manipulative design, Amazon had “accumulated a significant clarity

22

debt that [it] need[ed] to start paying down.” Furthermore, its “approach to clarity [had] been

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short sighted” because “experiments [had] been focused on impact to paid members and

2

signups” using the existing problematic checkout enrollment flow as a baseline, which made

3

changes difficult because changes that reduced problematic elements lowered enrollment. The

4

memorandum proposed “considering the impact on member trust and brand equity” instead.

5

212.

The document framed the issue this way: “[w]e seek leadership feedback on i)

6

are we willing to take an initial membership hit to reset our clarity baseline, and if so, ii) how

7

fast we should move to fix these defects.”

8

213.

After Defendant Ghani approved a draft on June 3, 2020, the Prime Organization

9

organized a “Prime Clarity and Member Trust Review” with Defendant Lindsay on July 24,

10

2020. At least initially, Lindsay agreed to support the CE&O team’s push for clarity.

11

214.

Following the meeting, in September 2020, the Prime Organization fixed several

12

key problems with the UPDP in the United States including: (a) changing the “decline” option

13

from a link to a “No thanks” button; (b) making Prime’s price visible outside the terms and

14

conditions; and (c) re-labelling the enrollment button with wording that included “Prime” or

15

“Free Trial” (collectively, the “September 2020 Changes”).

16
17
18

215.

As predicted, the September 2020 Changes reduced Prime’s subscription

numbers.
216.

By November 2020, however, it became clear that the September 2020 Changes

19

would cause Prime to miss its financial goals. On December 3, 2020, Defendants Lindsay and

20

Ghani met with various Prime Organization leaders and another executive, Doug Herrington, to

21

review Prime’s performance.

22
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The memorandum further explained that, as a consequence, the Prime Organization would roll

2

back the September 2020 Changes and return to the version of the enrollment checkout flow

3
4

217.

Defendants Ghani and Lindsay decided to make this rollback permanent. In this

5

regard, the Prime Organization continued to implement Defendant Grandinetti’s original

6

instruction not to make changes that would reduce subscriptions.

7

218.

■

Separately, a Shopping Design senior researcher formed a “Clarity Working

8

Group” to improve the enrollment and cancellation process across all of Amazon’s subscription

9

programs, including Prime, Audible, Kindle Unlimited, and Amazon Music Unlimited. It

10

produced a memorandum and design mockups comparing the then-current versions of

11

problematic enrollment and cancellation processes across Amazon with revised versions

12

intended to “increase clarity during subscription sign-up, renewal, and cancellation.” For

13

instance, with respect to Prime, the Clarity Working Group recommended that the enrollment

14

button needs to clearly state that a customer is signing up for a 30-day free trial or a paid

15

subscription rather than only stating the customer will receive “FREE” shipping. The Clarity

16

Working Group further highlighted the fact that customers had trouble finding the ingress to the

17

Iliad Flow and prematurely abandoned the Iliad Flow under the incorrect assumption they had

18

completed cancellation of their Prime subscription. The Clarity Working Group also proposed

19

metrics to evaluate performance

20

The Clarity Working Group presented its memorandum and design mockups to Defendant Ghani

21

and a Shopping Design executive, Llew Mason, on December 16, 2020.

22
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2

219.

The Clarity Working Group’s December 16, 2020, memorandum urged Amazon

3

not to “let financial impact impede efforts to build a trustworthy [customer experience].” It

4

further noted the decision to roll back the September 2020 Changes would “improve growth

5

metrics” but at the expense of engaging in a

6

asked Mason and Defendant Ghani to “urgently revisit this rollback strategy with the right

7

decision-makers.”

8
9

The Clarity Working Group

Amazon’s 2021 Decision to Make Certain Changes in Response to Regulatory Pressure
220.

On January 6, 2021, Ghani emailed Lindsay. Ghani explained that he had met

10

with the Shopping Design Clarity Working Group, which put “forth some standards that Prime

11

knows would be significant headwinds to sign ups and are counter to where I think we landed

12

with you and Doug [Herrington].” Ghani further acknowledged the “real tension between the

13

ongoing push to improve [the customer experience] . . . and the concrete decisions to be made in

14

Prime upsells and their headwind to growth,” describing that process as a “balancing act.” Ghani

15

also explained to Lindsay “[t]he reality is that the changes we made in September to Prime

16

templates where (sic) deemed to be near the ‘minimum bar’ of what we wanted to improve (e.g.,

17

call out the price outside of the [terms and conditions], make negative [button or link] as

18

prominent as positive (sic), remove shadow boxes around buttons). But as you know, the

19

changes nevertheless had a significant negative impact.”

20

221.

Defendant Lindsay elected to prepare yet another memorandum for yet another

21

executive, Senior Vice President Dave Clark, to again facilitate a decision among Lindsay,

22

Ghani, and others regarding whether to make any changes.

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222.

Specifically, Defendant Lindsay explained to Defendant Ghani: “I may land in

2

the same place, but given how hot this topic is in the press lately, and the risk of regulatory

3

action in some countries, I [am] [sic] wondering how you might thread the needle . . . between

4

making it easy to join, easy not to mistakenly join and not unduly difficult to unsubscribe[.]”

5

223.

Additionally, Defendant Lindsay asked for “benchmarking,” or analyses of the

6

enrollment and cancellation processes Amazon’s competitors use. Defendants Lindsay and

7

Ghani sought to determine whether, regardless of Amazon’s own behavior or legal obligations,

8

its competitors appeared to use more pernicious enrollment and cancellation design techniques.

9

The Prime Organization then compiled the requested “benchmarking” information comparing the

10

Prime checkout enrollment flow and the Iliad Flow to competitors’ enrollment and cancellation

11

experiences.

12

224.

The Prime Organization further prepared a draft memorandum that Defendants

13

Ghani and Lindsay approved. That memorandum posed several questions, including “[h]ow

14

much friction should we add to the signup process knowing that these initiatives come[] at a cost

15

in terms of signups and member balance?” The memorandum answered: “Based on results from

16

our experiments, we believe tightening clarity at a single transaction at signup is not the right

17

approach and that such highly impactful changes to the [customer experience] should not be

18

introduced abruptly given the shock to business performance[.]”

19

225.

The Prime Organization’s memorandum asked: “How easy should we make it to

20

cancel Prime?” It also framed the issue as whether Amazon should simplify the Iliad Flow for

21

some consumers, “while taking others through a longer path, communicating the benefits of a

22

membership and persuading them to stay Prime. . . . If not, should we lean in towards a strategy

23

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that simplifies cancelation across the board, including enabling a one click cancellation for all

2

customers . . . ?” However, Defendants Lindsay and Ghani made no changes.

3

226.

In assisting with the memorandum, one Clarity Working Group member noted the

4

existence of “consumer watchdogs [who] say the manipulative ‘dark pattern’ design makes it

5

hard for people to end membership.”

6

227.

On March 16, 2021, the FTC issued a CID to Amazon seeking information

7

necessary to evaluate whether the Prime enrollment process and the Iliad Flow violated the

8

Restore Online Shoppers’ Confidence Act (“ROSCA”), 15 U.S.C. §§ 8401-05. At that point,

9

Amazon’s in-house counsel (and, later, its outside counsel) assumed greater control over

10

business decisions involving the Prime enrollment process and the Iliad Flow.

11

228.

Clark met with Defendants Lindsay and Ghani on May 6, 2021, less than two

12

months after the CID. Amazon decided to make changes to the enrollment and Iliad flows either

13

during or as a result of this meeting.

14
15
16

229.

Amazon made these changes as a result of pressure from both the FTC and

European Union regulators.
230.

In the second quarter of 2021, Amazon initiated a project to shorten the Iliad Flow

17

in the European Union. As discussed above, see Paragraphs 127 and 130, Amazon made

18

changes to the Iliad Flow in the United States in or about April 2023.
Manipulative Designs in the Checkout Enrollment and Iliad Flows

19
20
21

231.

The manipulative designs (sometimes called dark patterns) Amazon uses, or has

used, in its Prime enrollment flows and the Iliad Flow include the following elements:

22
23

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(a)

1
2

Forced Action. “Forced Action” is a design element that requires users to

perform a certain action to complete a process or to access certain functionality.
(i)

3

Amazon uses Forced Action in the UPDP version of its Prime

4

enrollment flow, during which Amazon forces the consumer to choose whether to enroll in Prime

5

before allowing the consumer to complete her purchase. In fact, at least as of 2018, Amazon

6

knew that some consumers clicked on yellow buttons expecting only to continue the checkout

7

process rather than to enroll in Prime.
(ii)

8

Amazon also uses Forced Action in its Iliad Flow by forcing the

9

consumer to proceed through multiple screens to cancel their subscription. The presence of

10

Forced Action complicates the Iliad Flow.
(b)

11

Interface Interference. “Interface Interference” is a design element that

12

manipulates the user interface in ways that privilege certain specific information relative to other

13

information.

14

(i)

Amazon uses Interface Interference in its Prime checkout

15

enrollment flow, most versions of which reveal the terms and conditions of Prime only once

16

during the purchase process, and then only in a small, easy-to-miss font. Amazon also uses

17

repetition and color to direct consumers’ attention to the words “free shipping” and away from

18

Prime’s price, which leads some consumers to enroll without providing informed consent.

19

(ii)

Amazon also uses Interface Interference in the Iliad Flow by

20

emphasizing options that divert the consumer from the flow without cancelling and by

21

employing warning icons near the option to cancel, which evokes anxiety and fear of loss in

22

consumers. The presence of Interface Interference complicates the Iliad Flow.

23

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(c)

1

Obstruction (“Roach Motel”). “Obstruction,” also known as the “roach

2

motel” technique, is a design element that involves intentionally complicating a process through

3

unnecessary steps to dissuade consumers from an action.
(i)

4

Amazon uses Obstruction throughout its Prime checkout

5

enrollment flows by making the option to decline enrollment difficult to locate.

6

In fact, since at least 2018, Amazon has known that some consumers cannot find the less

7

prominent “No Thank You” link to decline enrollment.
(ii)

8

Amazon also uses Obstruction in its Iliad Flow by: (1) making the

9

ingress to the Iliad Flow difficult for consumers to locate; and (2) forcing consumers who have

10

already expressed an intent to cancel by locating and entering the Iliad Flow to view marketing

11

and reconsider options other than cancellation. The presence of Obstruction complicates the

12

Iliad Flow.

13
14
15

(d)

Misdirection. “Misdirection” is a design element that focuses a

consumer’s attention on one thing to distract from another.
(i)

Amazon uses Misdirection in its Prime checkout enrollment flow

16

by presenting asymmetric choices that make it easier to enroll in Prime than not. Additionally,

17

certain versions of Amazon’s checkout enrollment flow offer consumers only a less prominent

18

blue link to decline Prime.

19

(ii)

Internal materials from Amazon identify the use of a link rather

20

than a button as a type of “misdirection.” In fact, Amazon has known for years that presenting

21

consumers with visually unequal options is problematic. As one email from a senior researcher

22

recounts, “[d]ating back to 2017, we have made multiple requests (at the Neil [Lindsay] and

23

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Jamil [Ghani] level) that the [Prime] team move to a more customer-friendly and accessible CX

2

[customer experience], whereby we would use two equally prominent buttons for the Sign Up vs.

3

No Thanks.”
Amazon also uses Misdirection in certain versions of the

4
5

Prime checkout enrollment flow by failing to label the button that enrolls consumers in Prime

6

with text indicating what pressing the button will do. For example, Amazon has known for years

7

that some consumers do not understand that buttons labelled “Get FREE two-day shipping”

8

actually enroll the consumer in the Prime subscription program.
(iii)

9

Amazon also uses Misdirection in its Iliad Flow by presenting

10

consumers with asymmetric choices that make it easier to abandon an attempted Prime

11

cancellation than to complete it. In particular, Amazon uses attractors such as animation, a

12

contrasting color blue, and text to draw consumers’ attention to “Remind me later” and “Keep

13

my benefits” options rather than “Continue to Cancel.” Amazon further misdirects consumers

14

who have entered the Iliad Flow by presenting visually appealing options to perform acts other

15

than cancel, such as exploring the benefits of the subscription service (thereby exiting the Iliad

16

Flow). The presence of Misdirection complicates the Iliad Flow.

17

(e)

Sneaking. “Sneaking” is a design element that consists of hiding or

18

disguising relevant information, or delaying its disclosure. Amazon uses Sneaking by failing to

19

clearly and conspicuously disclose Prime’s terms and conditions during its enrollment checkout

20

flow, including its price and auto-renew attribute. Amazon also employs Sneaking by failing to

21

show Prime’s price or its auto-renewal feature in the consumer’s cart.

22
23

AMENDED COMPLAINT
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(f)

1

Confirmshaming. “Confirmshaming” is a design element that uses

2

emotive wording around the disfavored option to guilt users into selecting the favored option.

3

Until at least 2020, the Prime checkout enrollment flow used confirmshaming by requiring

4

consumers who sought to decline Prime to click a link stating “No thanks, I do not want fast, free

5

delivery”:

6
7

No th-nks, I do no

ant fast, free sh· ping

Get FREE Two.Day Shi,pp.ing
'Enjo Prim FREE for 30 d

8
9

Amazon used such confirmshaming despite internal analyses questioning the propriety of this

10

wording. Amazon’s most recent TrueSPC enrollment pathway continues to use a form of

11

confirmshaming when it claims: “we’d hate for you to miss out on unlimited fast, FREE

12

delivery.”

13
14

Amazon’s Other Subscription Programs Have Similar Features
232.

Amazon operates other subscription services including Audible (audiobooks and

15

podcasts), Kindle Unlimited (eBooks and digital media), Amazon Music Unlimited (streaming

16

music), and Subscribe & Save (regularly-scheduled delivery of consumer goods). These other

17

subscription services also use similar manipulative design elements that trick consumers into

18

signing up and thwart their cancellation attempts.

19

233.

Amazon’s internal usage numbers demonstrate the problem.

20
21
22
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AMENDED COMPLAINT
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234.

Design concepts that Amazon employs in Prime—its largest subscription

2

service—are readily transferrable to Amazon’s other subscription programs. Indeed, the

3

Amazon designers and researchers who unsuccessfully urged Amazon to change Prime

4

enrollment and cancellation processes also asked Amazon executives to make similar changes to

5

Amazon’s other subscription programs. As with Prime, however, Amazon leadership slowed or

6

prevented clarity-enhancing and legally-required design changes that would reduce subscription

7

numbers.
Amazon’s Misuse of the “Privileged” Label on Documents

8
9

235.

Amazon and its executives, including Defendants Lindsay, Grandinetti, and

10

Ghani, misused “privileged” designations on documents addressing issues related to

11

Nonconsensual Enrollment and the Iliad Flow:

12

(a)

13

and Ghani, labelled or forwarded material as “privileged” when the material

14

addressed issues related to Nonconsensual Enrollment or the Iliad Flow but did

15

not contain or seek legal advice. Amazon and its leadership further directed

16

subordinates to follow this improper practice. For example, one employee wrote

17

in a January 20, 2021 email that “clarity is a P&C [privileged and confidential]

18

topic.” In another, a Prime VP stated, “it’s not appropriate to have this

19

conversation [on a lack of clarity in an enrollment upsell] over email, and

20

increasingly a mass one at that (just adding P&C does little).”

21

(b)

22

included phrases such as “for counsel” or “seeking counsel” or similar at the

23

Amazon and its executives, including Defendants Lindsay, Grandinetti,

Amazon and its executives, including Defendants Lindsay and Ghani,

AMENDED COMPLAINT
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beginning of email correspondence addressing issues related to Nonconsensual

2

Enrollment or the Iliad Flow—typically copied to one lawyer along with many

3

businesspeople—when the correspondence did not contain a request for legal

4

advice. Amazon and its leadership further directed subordinates to follow this

5

improper practice.

6

(c)

7

and Ghani, included attorneys in certain meetings about Nonconsensual

8

Enrollment and the Iliad Flow for the purpose of attempting to render the

9

meetings privileged. For instance, Amazon withheld all information regarding the

10

May 6, 2021 meeting referenced in Paragraph 228. Amazon and its leadership

11

further directed subordinates to follow this improper practice.

12

236.

Amazon and its executives, including Defendants Lindsay, Grandinetti,

Amazon and Defendants Lindsay, Grandinetti, and Ghani performed or directed

13

these improper practices because they understood that Nonconsensual Enrollment and the Iliad

14

Flow would inevitably result in government investigations.

15

237.

By identifying (and causing others to identify) communications concerning

16

Nonconsensual Enrollment and the Iliad Flow as privileged when they were not, Amazon and

17

Defendants Lindsay, Grandinetti, and Ghani obstructed the FTC’s investigation, delaying the

18

Commission’s ability to access the falsely-labelled material.

19

238.

When these acts occurred, Amazon and Defendants Lindsay, Grandinetti, and

20

Ghani knew that the Commission’s investigatory proceeding was foreseeable or underway.

21

Amazon and Defendants Lindsay, Grandinetti, and Ghani intended to interfere with the

22

Commission’s investigatory proceeding and, in fact, did so in the manner alleged herein.

23

AMENDED COMPLAINT
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Amazon’s Other Attempts to Delay the Commission’s Investigation

1
2

239.

On March 16, 2021, the Commission issued a CID to Amazon seeking

3

information regarding the enrollment and cancellation practices associated with Prime. The CID

4

directed Amazon to respond by April 15, 2021. Amazon assured the Commission that it would

5

cooperate, but did not.

6

240.

Amazon has over 1.5 million employees—i.e., potential document custodians—

7

and its internal communications are replete with acronyms and other jargon—i.e., potential

8

search terms—not readily identifiable to outsiders. Accordingly, as with any discovery process,

9

the Commission had to, and did, rely on Amazon to participate in good faith in the discovery

10

planning process, including by identifying appropriate custodians and search terms.

11

241.

During at least one phone call shortly following the issuance of the CID,

12

Amazon’s counsel assured the FTC’s counsel that, in substance, “I will get you what you need.”

13

Amazon’s counsel also told the FTC’s counsel that Amazon would work “to identify the most

14

efficient means of providing [the FTC] with the information [it] need[s] to complete [its]

15

investigation.” These assurances are consistent with any opposing counsel’s obligation to

16

engage in good faith discovery planning. As detailed below, however, Amazon did not follow

17

through on these assurances, instead, for example, proposing search terms and custodians that led

18

the Commission away from key documents.

19

242.

In the context of the customary need to rely on opposing counsel to act in good

20

faith, Amazon counsel’s significant experience working on FTC investigations, Amazon’s

21

promise to “get you what you need,” the massive amount of potential document custodians and

22

search terms (many of which were unknowable to the Commission), and other express

23

AMENDED COMPLAINT
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assurances of cooperation throughout the Subject Period, the Commission agreed to rely on

2

Amazon to provide—in the first instance—a sufficient response to the CID, including reasonable

3

search terms and custodians, to enable the Commission to fairly evaluate Amazon’s Prime

4

enrollment and cancellation practices. However, the Commission always reserved its right to ask

5

for additional responsive information and additional search terms and custodians.

6

243.

Accordingly, during the Subject Period, in response to Amazon’s assurances of

7

cooperation and that Amazon would provide the Commission what it needed, the Commission

8

temporarily accepted the eight custodians (out of approximately 500 employees with potentially-

9

responsive information) and narrow search terms Amazon proposed. The Commission relied on

10

Amazon’s assurances that the custodians and search terms selected by Amazon would provide

11

the information the FTC needed.

12

244.

By March 14, 2022, one year later, Amazon had produced only a small amount of

13

material—fewer than 9,000 documents—using the custodians and search terms that it had

14

proposed.

15

245.

On March 14, 2022, Business Insider published information leaked from current

16

and former Amazon employees regarding the problems with Amazon’s Prime checkout

17

enrollment flow and the Iliad Flow. The Commission quickly ascertained that Amazon had

18

failed to disclose much of the now-leaked documents and information to the Commission,

19

despite the fact that at least some of it was responsive to the outstanding CID. Amazon withheld

20

the information by identifying combinations of search terms and custodians it knew would not

21

surface the most probative—and inculpatory—material. Among other things, Amazon failed to

22

identify as custodians key individuals who communicated extensively about the Prime

23

AMENDED COMPLAINT
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1

enrollment and cancellation processes, including the most knowledgeable employees on these

2

subjects. Amazon also failed to identify as custodians individuals the Business Insider article

3

named as key decision-makers regarding the Nonconsensual Enrollment problem and the Iliad

4

Flow.

5

246.

In contrast, two of the eight custodians identified by Amazon performed little

6

work germane to the investigation. But for the Business Insider article, Amazon’s failure to

7

identify relevant custodians and search terms may have gone undiscovered.

8

247.

Pursuant to its reservation of rights, on April 19, 2022, the Commission issued an

9

extensive follow-up demand for additional information. Amazon did not comply with this

10

demand, instead making the incredible claim that doing so would take 30 months.

11

248.

On June 30, 2022, the Commission issued an additional CID to Amazon as well

12

as CIDs to various current and former employees seeking documents and testimony. Amazon

13

also did not comply with the June 30, 2022 CID.

14

249.

Instead, on August 5, 2022, Amazon and certain individual CID recipients

15

(including Defendants Lindsay, Ghani, and Grandinetti) petitioned the Commission to quash the

16

June 2022 CIDs. On September 21, 2022, the Commission denied the petition in every material

17

respect. Three Commissioners noted with respect to one legal question Amazon raised as a basis

18

to delay or avoid providing testimony: “The issue raised by this dispute is just one of many

19

challenges facing FTC staff when pursuing complex investigations of targets that may perceive

20

benefits to prolonging discovery.” Although the Commission ordered Amazon and the

21

individual petitioners to fully comply, they did not.

22
23

AMENDED COMPLAINT
Case No

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Source: Frix Law Library, https://www.frixlaw.com/law-library/documents/agency%3Aftc%3Af235163925ea617b. Public record. Not legal advice.