US judge admonishes Amazon over disclosures in FTC lawsuit over Prime service

By Mike Scarcella

July 10 (Reuters) - A U.S. judge formally admonished Amazon.com AMZN.O on Thursday for withholding documents from the U.S. Federal Trade Commission in a lawsuit accusing the e-commerce giant of deceiving customers of its paid Prime service.

In his ruling, U.S. District Judge John Chun in Seattle said Amazon’s withholding of thousands of documents from the agency during the evidence-sharing phase of the case was “tantamount to bad faith.”

Amazon had invoked attorney-client privilege in protecting information from the federal trade agency, which enforces consumer protection laws. Chun in his order cited some emails that he said showed there was no justification for keeping the documents from the FTC.

Amazon did not immediately respond to a request for comment, and its defense lawyers either declined to comment or did not immediately respond to a request for one.

The FTC declined to comment.

Amazon in a May court filing said it had worked cooperatively with the FTC to produce hundreds of thousands of documents and that it had no intent to hide anything from the agency. Amazon accused the FTC of trying to "drag out the fight."

The FTC sued Amazon in 2023, accusing it of enrolling millions of consumers into its Prime subscription service without their consent and making it difficult for them to cancel. Prime offers its members delivery deals and other benefits.

In the lawsuit, the FTC alleged Amazon used "manipulative, coercive or deceptive user-interface designs known as 'dark patterns' to trick consumers into enrolling in automatically renewing Prime subscriptions."

Amazon has denied the claims, and a trial is scheduled for September.

Chun said Amazon’s delayed production of tens of thousands of documents appeared to stem from a “desire to gain a tactical advantage.”

The judge declined to punish Amazon further than his public admonition. “Similar conduct may lead to more serious sanctions,” Chun wrote.

The case is Federal Trade Commission v. Amazon.com Inc, U.S. District Court, Western District of Washington, No. 2:23-cv-00932-JHC.

For FTC: Jonathan Cohen of FTC

For Amazon: Stephen Anthony of Covington & Burling; and Moez Kaba of Hueston Hennigan

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