Amazon has reached a proposed class action settlement valued at over $1 billion to resolve claims of mishandling customer returns, agreeing to pay $309 million directly to affected U.S. shoppers, as reported by Reuters.

According to The Verge, the agreement includes $600 million in refunds already secured for customers who were denied proper reimbursements, plus $309 million in cash payments and $363 million toward improving return and refund processes. Amazon denies any wrongdoing in the case.

The lawsuit, filed in 2023 in U.S. District Court in Seattle, alleges that despite advertising “free, no hassle returns,” Amazon often failed to issue refunds, recharged customers for returned items, or delayed processing, causing financial losses. It covers U.S. purchasers since September 2017, with class members expected to receive full recovery plus interest, pending approval by Judge Jamal Whitehead, per details from PCMag.

In a statement to The Verge, Amazon spokesperson Maxine Tagay noted, “Following an internal review in 2025, we identified a small subset of returns where refunds weren’t completed or items couldn’t be verified, leading to no refund. We began issuing refunds in 2025 and are providing additional compensation under the settlement.”

Separately, Amazon is handling a $2.5 billion settlement with the Federal Trade Commission over deceptive Prime subscription practices. The FTC alleged Amazon tricked millions into enrolling and made cancellations difficult. The deal includes a $1 billion civil penalty and $1.5 billion in consumer refunds, with claims now open for eligible Prime members from June 2019 to June 2025, according to the FTC press release.

On social media platform X, the returns settlement has generated buzz. For example, Bloomberg Law shared that Amazon settled for over $1 billion to end refund claims. CordCuttersNews posted about the $309 million payment over customer returns. The Verge highlighted the over $1 billion settlement for the ‘no hassle returns’ issue. Users like Daily Tech News noted the $309 million payment as part of the deal.