Amazon Facing Class-Action Lawsuit Over Introducing Ads to Prime Video
Plaintiffs allege that changing the terms of service for users who had signed up for annual plans are being unfairly charged to go ad-free.
In a shrewd move that was always guaranteed to draw customer ire, Amazon decided to bring ads to Prime Video in late January. That decision, on its own, likely wasn’t enough to roil customers; after all, nearly all of the top subscription video streamers have an ad plan nowadays. The anger was generated by Amazon’s decision to introduce ads for all current Prime Video subscribers unless they upgraded to an ad-free tier for an extra $2.99 per month. This unique approach stirred up plenty of angst against Amazon, and now The Hollywood Reporter is providing details on a new class-action lawsuit recently filed in federal court related to the Prime Video ad rollout.
- The suit, filed in California, is seeking at least $5 million in damages.
- Annual subscribers allege their terms of service were unfairly changed after they had already paid for their service.
- Amazon has faced legal action in the recent past, but it managed to escape those troubles.
What’s at Stake in Prime Video Lawsuit?
The plaintiffs who filed the suit against Amazon in California are claiming that the tech company is guilty of breach of contract, false advertising, and unfair competition, among other violations of California’s consumer protection laws. It states that Prime Video subscribers who signed up for annual plans before Dec. 28, 2023, saw their terms of service change, unfairly charging them more money for a product — specifically, ad-free streaming on Prime Video — that they’d already paid for.
The plaintiff states that they and everyone who had subscribed for a product that Amazon advertised as “commercial-free” had a “reasonable expectation” that they would be able to keep ad-free Prime Video at least until their annual purchase expired. By implementing the change as a blanket policy instead of keeping annual subscribers ad-free at the same price as when they signed up for their service, Amazon was breaking the law.
The suit seeks at least $5 million in damages, as well as a court order that would bar Amazon from making any further deceptive claims in the future.
Do Plaintiffs Have a Chance Against Amazon?
The Streamable’s experts have seen Amazon take on the courts and win before. For example, Amazon faced legal action in 2020 over the company’s right to end a customer’s access to a TV show or movie they had purchased through Prime Video. Amazon argued that its terms of service clearly stated certain titles may become unavailable thanks to changing licensing agreements.
The judge sided with Amazon in that case, but the outcome of this suit depends on the language in Prime Video’s former subscriber agreement. If the terms of that agreement include language that subscription terms are subject to change at Amazon’s discretion, there may not be much that the courts can do on behalf of customers who allege that they’ve been deceived and double-charged for their Prime Video accounts.
If the case proceeds, however, it would become the second major streaming industry class-action lawsuit to create headlines in the past few months. The NFL and DIRECTV are facing a case brought by NFL Sunday Ticket subscribers who say that the league and its original Sunday Ticket distribution partner violated antitrust laws. That suit could pay out as much as $6.1 billion if the judgment is handed down in favor of the plaintiffs.
Amazon certainly has a powerful legal team at its disposal, and it will fight this suit with all the means at its disposal. There’s no denying the amount of consumer anger generated by Amazon’s strategy with its ads rollout on Prime Video; now it’s up to the U.S. District Court in California to decide if it was a violation of consumer rights.
Amazon Prime Video
Amazon Prime Video is a subscription video streaming service that includes on-demand access to 10,000+ movies, TV shows, and Prime Originals like “The Lord of the Rings: The Rings of Power,” “Jack Ryan,” “The Marvelous Mrs. Maisel,” “The Boys,” and more. Subscribers can also add third-party services like Max, Showtime, STARZ, and dozens more with Amazon Prime Video Channels. Prime Video also offers exclusive live access to NFL Thursday Night Football.