⚖️ Amazon fined $2.5B

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Amazon to Pay $2.5B Over Prime Enrollment Practices

Amazon has agreed to a $2.5 billion settlement with the Federal Trade Commission (FTC) after allegations that it tricked users into Prime subscriptions and made cancellations difficult. The settlement includes a $1 billion civil penalty and $1.5 billion in consumer refunds. Moving forward, Amazon must clearly display subscription costs, billing frequency, and cancellation procedures, and provide an easy opt-out mechanism.

Why It Matters

The case underscores the FTC’s increasing scrutiny of deceptive UX practices and subscription “dark patterns.” Amazon’s example highlights how even large, sophisticated companies can face massive penalties for manipulating users, signaling that regulators are watching closely. For startups, this is a reminder that transparency and fairness in onboarding and billing aren’t just ethical—they’re essential to avoiding costly enforcement actions.

Lessons for Founders

Startup founders should audit their own subscription flows and cancellation processes. Ensure pricing, billing, and auto-renewal details are crystal clear, and make opting out as simple as signing up. Investing in user-centric design now can prevent regulatory headaches later and build trust that drives long-term retention.

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