The e-commerce giant Amazon finds itself embroiled in significant legal troubles on multiple fronts as of October 2025, facing both a proposed class action lawsuit over its digital content ownership policies and a massive $2.5 billion settlement with the Federal Trade Commission.
Filed in the U.S. District Court for the Western District of Washington, the class action alleges Amazon misleads customers with its “Buy” button for digital content on Prime Video, suggesting permanent ownership when users actually receive only a limited, revocable license.
Plaintiffs argue Amazon violates California’s Digital Property Rights Transparency Law by failing to disclose upfront that “purchased” content can disappear from users’ libraries if the company loses distribution rights.
The complaint specifically cites violations of California’s Unfair Competition Law, False Advertising Law, and Consumer Legal Remedies Act, claiming Amazon’s Terms of Use are deliberately buried in fine print without securing explicit customer acknowledgment during checkout.
Amazon buries crucial ownership limitations in fine print, dodging customer acknowledgment while violating multiple California consumer protection laws.
Lead plaintiff Lisa Reingold claims she paid $17.79 for a Nickelodeon series believing the purchase granted her permanent ownership rights similar to buying a physical DVD.
Customers are unable to transfer or lend their digital purchases as they could with physical media, further contradicting the conventional understanding of ownership.
This situation highlights a growing concern among creative professionals, as musicians face similar challenges with sync licensing deals when their music is used in visual media like Amazon’s productions.
Artists involved in such productions should register with performance rights organizations to ensure they receive proper royalties when their works are used publicly.
Meanwhile, in a separate and substantial regulatory action, the FTC has secured a $2.5 billion settlement with Amazon over deceptive Prime subscription practices.
The settlement includes a $1 billion civil penalty and $1.5 billion in consumer refunds, addressing allegations that Amazon enrolled millions into Prime without proper consent and deliberately complicated the cancellation process, violating the FTC Act and Restore Online Shoppers’ Confidence Act.
Affected Prime customers can expect automatic refunds by December 25, 2025, with a secondary claims process launching in 2026.
Eligibility extends to U.S. customers who enrolled through certain flows or faced cancellation obstacles between June 23, 2019 and June 23, 2025.
The dual legal challenges highlight growing scrutiny over digital ownership rights and subscription practices in e-commerce. If the class action receives certification, millions who purchased digital content through Prime Video could be automatically included.
While the FTC settlement has been finalized, the digital content ownership lawsuit remains in its early stages with no ruling or settlement announced yet.
