Probably every parent has had this nightmare: receiving their credit card bill and seeing a huge amount charged to them for in-app purchases they did not make and then suddenly remembering that their kids were playing with their smartphone previously. Google has kind of found a solution for that problem, and so did Amazon. But a judge has ruled that the latter is liable for the in-app purchases that were made by minors, granting the motion summary judgement for the Federal Trade Commission.
According to US District Judge John Coughener, the fact that there was no mechanism for consent on Amazon’s side for the millions of dollars that were billed to unsuspecting parents and the time spent complaining about these unauthorized charges and seeking refund for said charges “demonstrate substantial injury”. He also cited the fact that Amazon stated in their policy that in-app purchases are “final and nonrefundable” also discouraged customers from going for refunds for those that were honestly accidentally done.
However, in his ruling, the judge did not offer any remedy as of yet. T The ruling noted that there are 1,573 customers that filed to have the app charges reversed but did not receive any refund from Amazon. he FTC actually filed this lawsuit back in 2014 and is looking at getting full refunds for all affected Amazon customers. The agency says that Amazon failed to make proper disclosures as well as warnings about IAPs. There was even a confidential document part of Amazon’s marketing plan that acknowledged that IAPs isn’t a well-known concept by their customers.
Previously, the FTC also settled similar cases against Google and Apple. The former paid refunds worth $19 million to their users while the latter settled $32.5 million in unauthorized charges. Amazon has so far refunded $10 million but a data analyst for the FTC claims that 42% of the total amount of in-app purchases (which was pegged at $86 million) were unauthorized. The judge however said that number may be inflated and asked for further briefing on that matter.