
Any U.S. user who continues to use Amazon is waiving their right to a class action, after the tech giant quietly updated its terms of use last Friday. The move is to encourage disgruntled customers to resolve their issues outside the court.
“All other disputes, claims, and requests for relief must be arbitrated, regardless of when they arose, which means you and we are each waiving our right to sue in court and have a judge or jury trial,” part of the latest terms read.
Amazon has now effectively brought back binding arbitration in its fine print, more than half a decade after it was—also quietly—removed, following lawyers who pooled tens of thousands of individual claims against the giant into what is called mass arbitration.
The company removed binding arbitration in July 2021. At the time it faced a mass arbitration of roughly 75,000 claims, all of which alleged Alexa, Amazon’s voice-operated assistant in devices like the Echo, had been recording customers without their consent.
This strategy left Amazon with a massive legal bill even before any case was resolved, according to a 2021 New York Times report, which estimated that a single claim would cost Amazon about $2,900 just to hire the arbitrator.
This time around, however, the tech giant is establishing parameters on mass arbitration by grouping them in batches of 25, 100, and 500, depending on the total number of claimants with similar issues. Each batch will get one arbitrator and one set of administrative fees, according to the latest terms.
Moving forward at Amazon, any case must first exhaust other options before going into binding arbitration, namely talking to customer service to resolve the issue at hand, and if this fails, then entering into a dispute resolution procedure in good faith for 60 days.
The latest update to the company’s terms of use comes at a time when other e-commerce sites have been slapped with proposed class-action lawsuits, many of which allege that brands have been issuing fake discounts to make a sale under the shopper’s false assumption of saving money.
Efforts to ban forced arbitration have so far failed, but not without raising alarms. Myriam Gilles, a professor at the Benjamin N. Cardozo School of Law, said in a Congress hearing in 2021 that class-banning forced arbitration clauses remove the only cost-effective path for many claimants.
She said forced arbitration was nothing but a “get out of jail free” card for companies with significant market power.
“By furtively imposing these provisions in the small print of job applications, employment contracts, and consumer transactions, corporate executives have written their own rules, opting out of liability by shunting all cases against them into a private system of single-file arbitration, where they know most cases will simply be abandoned,” she said.







