Amazon paying customers $309M to settle return policy lawsuit
What's the story
Amazon has agreed to a settlement valued at more than $1 billion, which includes both monetary and non-monetary components, to resolve allegations of improper refunds for returned items. The deal includes more than $600 million already paid or due in refunds, and additional payments to affected customers, court documents reveal. As part of the settlement, Amazon will contribute $309.5 million into a common fund for the class-action members.
Refunds
Amazon's refund distribution and future commitments
Amazon has already paid out some $570 million in refunds, with about $34 million still pending. The company has also committed to providing over $363 million in non-monetary relief to improve its return and refund practices. Despite these developments, Amazon maintains its innocence in the matter. The lawsuit, filed back in 2023, claimed that Amazon caused "substantial unjustified monetary losses" for customers who returned items but were still charged for them.
Review findings
Internal review and settlement agreement
Following an internal review in 2025, Amazon discovered a small number of returns where refunds were issued without payment completion or verification of the correct item being returned. The company started issuing refunds for these cases in 2025 and is now offering extra compensation and refunds to eligible customers as per the settlement agreement.
FTC settlement
Previous settlement over Prime subscriptions
Last year, Amazon paid $2.5 billion to settle an FTC lawsuit that accused the firm of tricking users into signing up for Prime and making it hard to cancel. The e-commerce giant is currently accepting claims from affected customers as part of this settlement process.