TL;DR: On August 14, Amazon put binding arbitration and a class-action ban back into its US Conditions of Use, five years after dropping them. The news coverage stopped at “arbitration is back”, but the real story is on a separate help page most people will never click, and it’s written to make sure 2021 never happens to Amazon again.

How I got here

I’m sick of getting “we’ve updated our terms” emails that are deliberately unreadable (or so close as to be indistinguishable). So I started tracking what actually changes in the terms of services I use. It turns out I don’t have to do the hard part: Open Terms Archive already records every version of these documents in public git repos, diffs and all. (I’ve since sent them a fix for their Meetup tracking, which had been quietly broken since January. Contributing beats complaining.)

Amazon was the first one I pulled, and I wasn’t expecting much from it.

The 2021 backstory: Amazon got dogpiled

Amazon had forced arbitration for years. Then plaintiffs’ firms did something clever: instead of one class action, they filed more than 75,000 individual arbitration claims over Alexa recordings. Under Amazon’s own rules, Amazon paid the filing fees on each one. The bill was reportedly in the tens of millions, and Amazon dropped arbitration and went back to letting customers sue in King County courts.

To me, that was the system working. A company wrote a rule that favoured itself, customers used the rule exactly as written, and the company decided it didn’t like the rule anymore.

What changed on August 14

Here’s the diff. The old disputes section was two sentences: sue us in Washington, no jury. The new one is a wall of capitals (calm down Amazon):

YOU AND WE AGREE THAT ANY DISPUTE OR CLAIM RELATING IN ANY WAY TO YOUR USE OF ANY AMAZON SERVICE, OR TO ANY PRODUCTS OR SERVICES SOLD OR DISTRIBUTED BY AMAZON OR THROUGH AMAZON.COM, WILL BE RESOLVED BY BINDING ARBITRATION RATHER THAN IN COURT.

The headline items, which everyone reported: no class actions, no jury, and a mandatory 60-day “good faith” negotiation before you’re allowed to file. Amazon emailed customers on a Friday, the terms took effect immediately, and any of us who continued to shop counted as agreeing. There is no opt-out. I looked.

The parts nobody seems to have dwelt on are the ones aimed squarely at 2021.

“Mass Arbitration” gets its own rules. If 25 or more similar claims from coordinated lawyers show up within six months, they get batched: “one set of administrative fees and a single arbitrator assigned per batch.” Batches of 25, then 100 once there are more than 500 claims, then 500 once there are more than 2,500. Per-claim fees were the lever that worked in 2021. This clause takes that away.

Amazon gets an appeal exactly where it hurts. JAMS appeal procedures apply “in any Mass Arbitration and in any arbitration in which either you or we receive a final award requiring payment of $250,000 or more.” Technically that cuts both ways. In practice, who do you think is writing the $250K cheques?

It reaches backward. “All other disputes, claims, and requests for relief must be arbitrated, regardless of when they arose.” Lawsuits already filed before August 14 are excluded. But anything that happened to you under the old court-friendly terms and you haven’t sued over yet? That goes to arbitration now. (I’m really not sure how Amazon gets away with retroactively, unilaterally renegotiating a contract, but if anyone can pull it off…)

The arbitrator decides whether arbitration is fair. The arbitrator gets “exclusive authority” over whether the agreement is “unconscionable, illusory, or otherwise unenforceable.” The referee rules on whether the referee should be there. And who pays the arbitrator?

The fine print behind the fine print

The Conditions of Use link to a separate pre-arbitration procedure page. (Amazon blocks automated fetches of its help pages, so I read this one the old-fashioned way.) This is where the design shows.

Your Notice of Dispute “must be personally signed by you, completed accurately and in full, accompanied by documents reasonably necessary to support your claim.” If Amazon asks for a settlement conference, you “personally participate in it by phone or video conference,” and “the conference must be individualized to our dispute, even if counsel represents other parties.”

Read that again with 2021 in mind. Seventy-five thousand claimants means 75,000 personally signed forms and 75,000 personal video calls, each one “individualized,” before a single arbitration can be filed. That’s not a fee. It’s a wall of logistics.

And if Amazon thinks you skipped a step? “A court can enjoin <do I love or hate that word?> the initiation or proceeding of an arbitration in breach of these pre-arbitration dispute resolution requirements,” and the arbitration “(and any obligation to pay arbitration fees) will be stayed until that request is resolved and all appeals exhausted.” So any argument over procedure freezes everything, Amazon’s fees included, for as long as appeals take.

Amazon’s spokesperson called arbitration “a fast, cost-effective way to resolve disputes.” For one customer with one small complaint, maybe. The machinery above isn’t built for that customer. But I’m pretty sure it’s only intended to be “fast, cost-effective” for the goons who came up with it.

The privacy side

Same season, the Privacy Notice gained a sentence: your personal information is used for “develop[ing] or deploy[ing] our generative AI models and services.” The linked Generative AI Development Disclosure has no opt-out and no settings toggle, never says which of your data goes in, and mentions they’ve been “collecting data since before 2022.” So the disclosure is new. The practice isn’t. Smells pretty sneaky eh?

Meanwhile the Conditions of Use still say you may not “use AI-generated content from the Amazon Services to… develop or improve large language or multimodal models.” Your data trains their models. Their output can’t train yours. (Naturally. How’s that free market of rational actors negotiating with equal footing working out for you?)

In fairness

Two changes favour customers, and I’d be a hypocrite to skip them. Personal-injury and property-damage claims from products bought on Amazon now fall under your state’s law, not Washington’s. And the clock on your claim (the statute of limitations) is paused during the 60-day negotiation, so the waiting period can’t quietly run it out.

Arbitration also happens virtually or in your home county, under JAMS’s consumer minimum standards. That’s better than some arbitration clauses I’ve read. It’s still worse than a courtroom.

What’s happened since

As far as I can find: nothing public. No reported motion to compel under the new terms, no mass filing yet. That’s partly timing. It’s also the point: arbitration is private, and outcomes generally aren’t published. If this clause works the way it’s designed, we’ll hear less about Amazon disputes, not more. Again, in whose favour is this?

What you can actually do

• Small claims court is still open. It’s carved out explicitly: “if the dispute or claim qualifies for small claims court in the jurisdiction in which you reside, then you or we may sue there instead.” For most individual grievances, that’s the real escape hatch.
• Keep your receipts. Under the new procedure, your claim is only as good as the “documents reasonably necessary to support” it.
• Watch the next diff. I’ll be watching it too.

I agreed to all of this the moment I bought something after August 14. So did you, probably. That’s the business model. Party on Garth!