Bates White client FTC secures historic $2.5 billion settlement against Amazon

September 26, 2025

In a landmark resolution reached early in the trial, Amazon has agreed to a record $2.5 billion settlement with the Federal Trade Commission (FTC) to resolve claims regarding Amazon's Prime subscription program.

The FTC's complaint, filed in June 2023, accused Amazon of using manipulative, coercive, and deceptive user-interface designs to mislead consumers into enrolling in its automatically renewing Prime subscriptions.

The settlement, which the FTC said in its press release includes the second-highest restitution it has ever obtained, requires Amazon to pay a $1 billion civil penalty and provide $1.5 billion in refunds to an estimated 35 million consumers harmed by its misleading Prime sign-up and cancellation processes. Additionally, under the agreement, Amazon must revise its enrollment and cancellation practices to comply with federal consumer protection standards.

The FTC retained Neale Mahoney, Professor of Economics at Stanford University, as its economic expert. Prof. Mahoney was supported by Bates White to assess liability and damages in the case. The data-driven analysis covered a comprehensive evaluation of the subscription sign-up and cancellation processes, including the extent of unintended enrollments and attempted but unsuccessful cancelations.

Prof. Mahoney's damages analysis and calculations in his expert report closely align with the consumer restitution obtained by the settlement, highlighting the significant impact of his work.

Bates White is proud to have contributed its economic expertise and analysis in support of Prof. Mahoney and the FTC in this case.