• by Wendy Davis  @wendyndavis, November 20, 2023

The Federal Trade Commission is pressing a federal judge to allow it to proceed with claims that Amazon used “dark patterns” to dupe people signing up for Prime subscriptions and thwart cancellation attempts.

“Millions of consumers who visited Amazon to shop instead found themselves enrolled in automatically-renewing Amazon Prime subscriptions without their knowledge or consent,” the FTC wrote in papers filed late last week with U.S. District Court John Chun in Seattle. “That result was the foreseeable -- and widely known within Amazon -- consequence of Amazon’s failure to tell consumers clicking buttons like 'Get Free Two-Day Shipping' would enroll them in a Prime free trial and that the trial would automatically convert to a paying membership,” the FTC adds.

The agency is asking Chun to reject Amazon's request to dismiss the FTC's complaint, arguing that the agency's charges are vague and “unconstitutionally opaque.”

The FTC's new papers come in a battle dating to June, when the agency sued Amazon for allegedly charging users without their consent, and violating the federal Restore Online Shopper Confidence Act -- which requires companies to disclose all subscription terms in advance, and offer simple cancellation mechanisms.

The complaint alleged that Amazon used “manipulative, coercive, or deceptive user-interface designs” to trick consumers into subscribing to the $15-a-month Prime, which offers benefits such as discounts, free delivery of many items, and access to streaming video through Prime Video. The FTC also alleged that Amazon hindered cancelation attempts by making the process too complicated.

Many of the allegations focused on Amazon's site design. For instance, the FTC pointed in its complaint to an interface that required online shoppers attempting to make a purchase to first say whether they will enroll in Prime. Amazon allows consumers to decline enrollment, but that choice is “less prominent” than the enrollment option, according to the FTC.

The agency wrote that Amazon has known since at least 2018 that some people can't find the link to decline enrollment. The FTC also said a check-out page that encourages people subscribe to Prime only discloses subscription terms in fine print.

Amazon argued to Chun that even if the allegations were true, they wouldn't support a conclusion that the company deceived users or violated the Restore Online Shoppers Confidence Act.

The company also argued that the allegations about “dark patterns” implicate all marketing.

“A primary function of any commercial advertising is to persuade consumers to purchase the products advertised -- often through strategically placed textual and visual displays or attention-grabbing fonts and colors,” Amazon wrote in a motion filed last month.

“It is unclear how the FTC could ever draw a discernible line between supposedly unlawful 'dark patterns' and permissible run-of-the-mill advertisements,” Amazon added.

The FTC counters that its complaint “plausibly alleges many ordinary customers would neither see nor understand Prime’s price and auto-renewal terms or, in some cases, that they are enrolling in Prime at all.”

“Contrary to Amazon’s assertions, those terms are presented in small print, below (sometimes far below) the enrollment button, often starting on the opposite side of the page as the button, and overshadowed by marketing text and graphics on the page,” the FTC argues. “Therefore, the terms are not clearly and conspicuously disclosed.”

Outside organizations including the Interactive Advertising Bureau are siding with Amazon in the dispute. Last week, Chun allowed the IAB and other organizations, including the tech industry groups NetChoice, Chamber of Commerce and Computer & Communications Industry Association, to weigh in -- despite the FTC's objection.

The IAB wrote in a friend-of-the-court brief that the FTC's complaint represented an attempt “to regulate and punish truthful statements made in advertising.”

“The FTC’s 'dark patterns' are described ominously in its complaint, but in substance they largely include a handful of benign, ordinary statements made in the course of Amazon marketing the benefits of its Prime membership and 'design elements' chosen by Amazon, such as the use of color to draw a consumer’s attention, to communicate Amazon’s message that Prime is valuable,” the organization contended.

The group added that the FTC “appears to seek to punish, ban, and regulate speech that it has not -- and cannot -- allege is untruthful by applying the label 'dark patterns,'” the group wrote.

“Prohibiting truthful speech that is too convincing is decidedly not a legitimate government interest,” the organization added.

Chun is expected to hold a hearing in the case on December 8.