Amazon is at the forefront of legal scrutiny and consumer discontent after a lawsuit was filed accusing the company of covertly charging its Prime members additional fees to stream content ad-free.
The class-action suit, which originated in a California federal court last week, claims breach of contract and infractions against consumer protection laws.
It maintains that Amazon inconspicuously altered the terms for its more than 100 million subscribers, who had been promised an ad-free viewing experience.
“Subscribers must now pay extra to get something they already paid for,” the complaint states.
In addition to being “unfair,” the suit claims Amazon illegally benefited by advertising Prime Video as “commercial-free” before it enacted an ad-supported tier, which “harms both consumers and honest competition.”
The crux of the discontent stems from a pivotal move by Amazon in 2023 to introduce an advertising model for Prime Video, on which the company has refused to comment. The subsequent introduction of an ad tier as the new standard, accompanying a $2.99 monthly fee to avoid commercials, catapulted Prime Video into a leading position among ad-supported streaming services.
However, yearly subscribers have raised concerns over Amazon’s change in service terms, describing the move as deceitful and the lawsuit encapsulates their sentiment.
The class-action case pushes beyond seeking compensation, with a demand for a minimum of $5 million in damages and a judicial injunction to prevent Amazon from perpetuating the alleged deceptive practice.
Claims addressed include false advertising and unfair competition, referring to state-specific consumer protection laws in California and Washington.
This isn’t Amazon’s only legal tussle in recent times.
The Federal Trade Commission (FTC) launched a lawsuit against the retail kingpin last year, accusing it of entrapping consumers with the Prime subscription and subsequently making the cancellation process burdensome. The FTC’s case denounced Amazon’s tactics as “manipulative” and “coercive,” suggesting that many customers intended only to use Prime Video, which comes at a lesser cost.
Beyond the FTC’s accusations, Prime holds a critical status within Amazon’s commercial empire, known for retaining customer loyalty. This loyalty is due in part to the perks it offers, such as seamless access to Prime Video content.
Amazon also faced a related lawsuit in 2020, alleging unfair competition and false advertising. This was tied to Amazon’s policy that could potentially revoke customer access to purchased Prime Video content.
In 2022, the complaint was rebuffed by a federal judge who ruled in favor of Amazon, reinforcing their stance that the company’s user agreement explicitly mentions the possibility of content unavailability due to licensing constraints.
• Staff can be reached at 202-636-3000.
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