A U.S. federal judge on Wednesday ruled in favor of the Federal Trade Commission in its lawsuit against Amazon (NASDAQ:AMZN), finding that the e-commerce giant violated consumer protection laws in the enrollment of customers for its Prime subscription service.
Judge John Chun determined that Amazon breached the Restore Online Shoppers’ Confidence Act by collecting payment details before fully disclosing the terms and conditions of Prime.
The court also noted that Amazon made canceling the subscription “unreasonably difficult” for consumers, bolstering the FTC’s claim that the company engaged in deceptive practices.
This ruling blocks Amazon from arguing at trial that the law does not apply to Prime sign-ups and leaves two executives potentially liable if violations are proven. The FTC alleges that tens of millions of users were enrolled without proper consent.
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