Federal Trade Commission officials made unreasonable demands, including targeting employees' homes to serve subpoenas, as part of the agency's investigation into the company's Prime membership program and other subscription services, Amazon said in a new legal filing.
Nearly 20 current and former Amazon employees and executives, including founder Jeff Bezos and CEO Andy Jassy, were subpoenaed as part of the probe. The company said those requests were "unduly burdensome, and calculated to serve no other purpose than to harass Amazon's highest-ranking executives and disrupt its business operations," according to the filing.
Other Amazon executives subpoenaed in the investigation include former retail boss Dave Clark and his successor Doug Herrington, SVP of international Russ Grandinetti, and former Prime VP Greg Greeley.
Amazon's law firm argued that the FTC should "quash or limit" the subpoenas, officially called Civil Investigative Demands, due to "unworkable and unfair" procedures that it describes as a "one-sided effort to force Amazon to meet impossible-to-satisfy demands."
"Staff's handling of this investigation has been unusual and perplexing," Amazon says in the petition.
Representatives for Amazon and the FTC declined to comment.
The document indicates that the FTC's investigation has reached a new, intense phase. Amazon noted that the probe has now expanded to four other non-Prime subscription services: Audible, Amazon Music, Kindle Unlimited, and Subscribe & Save.
The FTC seeks disappearing messages of Amazon executives
The agency is also asking Amazon to identify the number of shoppers who became "nonconsensual enrollees" and "diverted cancels" across the Prime, Audible, Amazon Music, Kindle Unlimited, and Subscribe & Save programs. In addition, it wants Amazon to search for executives using "ephemeral messaging" apps to discuss things like program enrollment and cancellation processes, and to create a log of those disappearing messages, according to the filing.
The FTC is trying to find about whether Amazon uses misleading tactics around the sign-up and cancellation process for Prime and other membership services. The agency is looking into whether Amazon intentionally used ambiguous language and confusing designs — commonly called "dark patterns."
The probe follows Insider's report in March that revealed Amazon executives and employees had for years worried about customers feeling tricked into signing up for Prime but opted not to use clearer language because it didn't want to slow the growth of its subscription business.
The FTC told Amazon that witnesses must be prepared to testify about "every action of any sort that the Amazon Parties took, in whole or in part, in response to the Insider Article," according to the filing.
The petition says Amazon first started working with the FTC on an investigation into Prime in March 2021. The company provided approximately 37,000 pages of documents, and repeatedly met with FTC members to answer questions. But those talks suddenly stopped in February 2022, it said.
Then in April 2022, the FTC reengaged with Amazon, saying it had a new attorney representing the case and was expanding the probe to include the four other services, plus another third-party subscription. The FTC allegedly told Amazon that they were under "tremendous pressure" to close the case by this fall, and demanded that Amazon produce additional documents for the investigation in roughly three weeks.
The FTC also blocked certain Amazon employees from using Covington & Burling, the same law firm that represents Amazon, by saying that such representation was "improper," according to the filing. Amazon described that as "plainly contrary to law."
FTC targeted employees' homes, Amazon says
The company also accused the FTC of trying to intentionally drag out the process by serving individual subpoenas just before the July 4th holiday weekend, at the homes of current and former Amazon employees, instead of going through Amazon's legal department. In doing so, the FTC caused "delay and confusion" about what it was doing, and in many cases, the witnesses did not find out about the subpoenas "until several weeks later," the filing alleges.
This investigation is led by the FTC's consumer-protection bureau and is separate from the agency's antitrust investigation into Amazon. Earlier this year, the FTC's chair, Lina Khan, publicly warned about dark patterns and difficult-to-cancel subscriptions. In October, the FTC published guidelines against "deploying illegal dark patterns that trick or trap consumers into subscription services."
Amazon faced similar accusations in Europe, and recently it agreed to simplify its Prime-cancellation process in the region. The change followed a complaint by the European Consumer Organisation, the Norwegian Consumer Council, and the Transatlantic Consumer Dialogue, which argued Amazon made it intentionally hard to cancel Prime memberships with a large number of hurdles and confusing wording.
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