Amazon has settled the Federal Trade Commission’s case against it for making it too hard to quit Prime, and while it naturally didn’t admit to any wrongdoing, it’s still going to pay out one of the largest settlements in FTC history to make the matter go away. 

The case, which Big Tech nemesis Lina Khan brought in 2023 under the Biden administration, accused Amazon of a years-long effort to make enrollment in the company’s subscription plan, Prime, without their consent while simultaneously making it nearly impossible to cancel. The FTC argued that Amazon made extensive use of manipulative user interfaces – so-called dark patterns – to manipulate customer behavior and trick them into signing up. 

Per the FTC, Amazon has agreed to pay a $1 billion civil penalty – the largest ever in a case involving an FTC rule violation – as well as $1.5 billion in consumer redress for an estimated 35 million customers who were allegedly ripped off by the ecommerce giant. The restitution fee is the second-highest ever obtained by the FTC. 

The settlement also resolved allegations against Amazon SVP of health services Neil Lindsay and Prime VP Jamil Ghani for their roles in the alleged scheme. 

Despite that, Amazon insists it did everything above board. 

“Amazon and our executives have always followed the law and this settlement allows us to move forward and focus on innovating for customers,” Amazon said of the matter in a statement. “We work incredibly hard to make it clear and simple for customers to both sign up or cancel their Prime membership, and … we will continue to do so.” 

Amazon told us in an email that the settlement included no admission of guilt, and that most of the changes the FTC ordered were things it had done years ago.

The settlement arrived just four days into the jury trial that began this week in a Seattle courtroom before Judge John Chun, and follows immediately after the testimony of former Amazon user experience researcher Reid Nelson, who told the court the company’s so-called “Iliad flow” used to trap users into prime membership was inconsistent with how it described the matter to the FTC, and was “difficult to complete.” 

In addition to Reid’s testimony, exhibits from the FTC included text messages and emails from Nelson to his colleagues indicating multiple attempts to flag the flow as misleading and confusing for customers. One message reportedly included Nelson speculating that a more transparent Prime design would make it difficult for the company to meet its own business goals. 

Along with the financial penalties, Amazon is being required to make it easier to not enroll in Prime, including through “clear and conspicuous disclosures about all material terms of Prime during the Prime enrollment process.” Cancellation must also be made as simple as enrolling, and the FTC is also requiring the company to hire a third-party supervisor to monitor its compliance with the settlement. 

Khan we get a more satisfying outcome? 

Current FTC chair Andrew Ferguson, who was a commissioner under Lina Khan before taking control of the agency under President Trump, touted the settlement as a day “the Trump-Vance FTC made history,” while conveniently erasing the fact that the Trump administration had little to do with the case. 

According to court records, much of the legal team on the case was assigned during the Biden administration and has remained unchanged with a few Trump-era additions. Regardless, Khan doesn’t seem too thrilled with the outcome. 

“This week marked the start of a historic jury trial, where American citizens would hear details of Amazon’s business practices and determine if it had broken the law,” Khan said in a post on X today. 

“A couple of days into trial [the] FTC announces it has settled all charges, rescuing Amazon from likely being found liable for having violated the law and allowing it to pay its way out,” Khan added. “A $2.5 billion fine is a drop in the bucket for Amazon and, no doubt, a big relief for the executives who knowingly harmed their customers.” 

In other words, were the matter under Khan’s control, Amazon may have felt a good deal more legal wrath and might not have had the option to settle at all. 

To put that historic $2.5 billion penalty into context, Amazon had a net income of $18.2 billion in the second quarter of 2025 alone, making $2.5 billion a relatively affordable expense.

Amazon is still facing an full-fledged antitrust lawsuit from the FTC, which is expected to go to trial in October 2026. ®