• by Wendy Davis , July 17, 2025

Handing Amazon a victory, a federal judge has thrown out a lawsuit by Prime subscribers who sued over the company's decision to insert ads in streaming videos.

In a ruling issued Wednesday, U.S. District Court Judge Barbara Rothstein in Seattle said the company's agreement with subscribers specifically provided for a "benefit modification" such as ending ad-free videos.

The decision was with prejudice -- meaning the subscribers can't revise their allegations and bring them again. Earlier this year, Rothstein dismissed a previous version of the subscribers' complaint, but that dismissal was without prejudice.

The ruling comes in a suit brought in February 2024 by California resident Wilbert Napoleon, who challenged Amazon over its then-new decision to serve ads in streaming videos (excluding videos people purchase or rent), unless subscribers paid an extra $2.99 a month.

The company rolled out its ad tier in January 2024.

Napoleon alleged that he renewed his annual subscription to Prime in June 2023 with the expectation that Amazon would continue to offer ad-free streaming. He pointed in the complaint to a February 2011 Amazon announcement introducing Prime video, which said Prime members would receive “unlimited, commercial-free streaming.”

Other subscribers joined the suit last year, claiming in an amended class-action complaint that Amazon broke its contract with subscribers and violated a Washington consumer protection law.

They initially characterized Amazon's move as a price hike, arguing that the company's terms prohibited price hikes during their one-year subscription term.

Rothstein rejected that argument earlier this year, when she dismissed the prior version of the case.

The subscribers then filed an amended complaint that largely reiterated their original claims, but with a a new focus on the section of the Prime Video terms of service dealing with modifications. That portion of the terms says Amazon may modify the service for five distinct reasons -- including adding functionality or features, and supporting quality and quantity of content.

The plaintiffs claimed Amazon violated that provision when it modified Prime Video by adding an ad-supported tier.

Rothstein rejected that argument this week, ruling that adding commercials was the type of change allowed by the Prime Video terms -- in part, because the move would support content. She noted in the ruling Amazon said in an email to subscribers that the ads would enable it "to continue investing in compelling content and keep increasing that investment over a long period of time.”