Hajra Naz
Amazon has agreed to a settlement valued at over $1 billion to resolve claims that it failed to properly refund customers for returned items. According to court documents, the settlement includes more than $600 million already distributed or scheduled to be paid in refunds, with additional funds set aside for affected consumers.
As part of the deal, Amazon will pay $309.5 million into a non-reversionary common fund, a pool reserved for members of the class-action lawsuit. The company has already issued roughly $570 million in refunds, with about $34 million still pending. Reuters first reported the settlement.
The e-commerce giant is also providing over $363 million in non-monetary relief, aimed at improving its return and refund processes. Amazon maintains that it did nothing wrong.
The lawsuit, filed in 2023, alleged that Amazon caused “substantial unjustified monetary losses” for consumers who returned items but were still charged.
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In a statement, Amazon explained:
“Following an internal review in 2025, we identified a small subset of returns where we issued a refund without the payment completing, or where we could not verify that the correct item had been sent back to us, so no refund had been issued. We started issuing refunds in 2025 for these returns and are providing additional compensation and refunds to eligible customers per the settlement agreement.”
This is not Amazon’s first large settlement. Last year, the company agreed to pay $2.5 billion to settle a lawsuit with the FTC, which accused it of tricking users into subscribing to Prime and making it difficult to cancel.
Amazon is currently accepting claims from impacted customers under the new settlement.
