Amazon Reinstates Arbitration for US Customers, Bars Class-Action Lawsuits
Amazon has reinstated binding arbitration for its US customers, making it more difficult to address grievances in court.
The change, effective immediately, bars customers from seeking class-action lawsuits and limits the number of arbitration cases that can be filed at once.
According to Amazon, this new policy will provide a 'fast, cost-effective way' for customers to resolve disputes while still allowing them to go to small claims court if necessary.
The company cited its previous experience with tens of thousands of costly individual cases as a reason for reviving arbitration. In 2021, it faced around 75,000 arbitration claims related to Alexa recording issues, which was part of a tactic used by some law firms to overwhelm corporations with arbitration claims.
Courts have generally sided with corporations in disputes over terms of service, and arbitration cases are settled privately before a third-party adjudicator. Disputes begun prior to the new terms will not be affected.