Amazon faces potential FTC lawsuit over advertiser claims

Key facts

• Amazon.com may face a potential lawsuit from the U.S. Federal Trade Commission.
• The lawsuit could result in billions of dollars in civil penalties.
• Allegations concern the e-commerce giant misleading advertisers.
• Multiple state attorneys general are involved in the FTC's ongoing investigation.
• The FTC has drafted a potential complaint against Amazon.

Amazon.com is reportedly facing a potential lawsuit from the U.S. Federal Trade Commission (FTC) that could result in billions of dollars in civil penalties. The allegations center on claims that the e-commerce giant misled advertisers, according to Bloomberg News and people familiar with the matter. The FTC, which enforces antitrust and consumer protection laws, has drafted a potential complaint as part of an ongoing investigation, and multiple state attorneys general are also involved.

This potential action comes after a separate, historic settlement in September 2025 where Amazon agreed to pay a $2.5 billion penalty to resolve allegations of deceptively enrolling millions of consumers into Prime subscriptions without their consent and making it difficult to cancel. That settlement included a $1 billion civil penalty and $1.5 billion in consumer refunds for an estimated 35 million impacted individuals. The FTC also mandated changes to Amazon's Prime enrollment and cancellation processes, requiring clear consent buttons and an easy cancellation method.

FTC Chairman Andrew N. Ferguson described the previous settlement as a "record-breaking, monumental win" against deceptive subscription practices. The agency alleged that Amazon used confusing interfaces to trick consumers into signing up for Prime and then created a complex cancellation process.