Court Decision Gives FTC Sweeping Discretion to Second-Guess Web Design

WASHINGTON D.C. —­­  Yesterday, a federal district court granted the FTC’s motion for summary judgment against Amazon in a lawsuit over the design of apps on the Kindle Fire. The FTC alleged that Amazon had committed an unfair trade practice by enabling children to make in-app purchases not authorized by their parents. This echoes the FTC’s settlement with Apple of similar charges in 2014 over the dissent of Commissioner Josh Wright. Conversely, the court blocked the FTC’s requests for an injunction to govern Amazon going forward, since Amazon had already changed its apps interface apps.

“If this decision stands, the web’s going to get a lot less user-friendly and a lot more ugly,” said Berin Szóka, President of TechFreedom. “Good user-interface design has been no less critical than technical innovation and business model experimentation in making the Internet awesome. Amazon led the way by launching 1-click ordering in the late 1990s. That feature launched a thousand imitators across the web, all guided by the principle that Dieter Rams, guru of industrial design, famously summarized with his mantra: ‘As little design as possible.’”

“But today’s decision gives the FTC sweeping powers as a nanny-state censor of interface design decisions,” continued Szóka. “Of course, companies can harm consumers with sloppy interface design, and the FTC must indeed protect consumers from things like unauthorized purchases. But the FTC’s also supposed to weigh tradeoffs carefully —  not just in economic terms, but in convenience for users, too. Here, the FTC invoked the hassle that a tiny percentage of parents experienced in requesting refunds, which Amazon readily granted. But the FTC refused to acknowledge that its preferred designs might also reduce the benefits of simple, elegant UI design for everyone else. The new mantra for Silicon Valley is ‘As little design as the lawyers tell you might be necessary to satisfy the FTC.’”

“The courts have once again abdicated their responsibility to check the FTC’s discretion,” warned Szóka. “Back in 1980, the FTC held onto its sweeping ‘unfairness’ power only because it promised Congress that it would give rigor to its three-part weighing test. It’s failed to do that on a wide range of consumer protection matters. There’s no such thing as perfect design, just as there’s no such thing as perfect data security, but the FTC’s overall approach to the Internet has become ‘Everyone’s guilty. But trust us, we’ll only go after the really bad guys.’”

“The real problem here is not letting this case go to trial,” explained Szóka. “If these questions can’t even get that far, there’s little hope that other companies will stand up to the FTC. The agency will get away with building a ‘common law of consent decrees’ on user interface that has as little analytical substance as its ‘soft law’ of privacy and data security. Designers everywhere better pray that Amazon has the courage to fight on, and that an appeals court actually weighs the FTC’s claims. If not, only Congress can keep the FTC in check, lest it plaster the web with the kind of ‘accept here’ pop-up clutter that Europe’s overzealous privacy regulators have required.”

“At least the court blocked some of the FTC’s heavy-handed approach to enforcement,” concluded Szóka. “Because Amazon had already changed its user interface to address the FTC’s concerns, the court refused to grant the FTC the permanent injunction it sought, which would have put Amazon’s future UI design decisions under even stricter scrutiny. That should somewhat reduce the FTC’s leverage in extracting settlements that push unfairness beyond the careful weighing required by Congress. But the court also ignored Amazon’s complaints about how the FTC calculated damages. So the FTC can still wield a huge sledgehammer in trying to convince companies to settle, and thus avoid judicial review of its increasingly zealous legal claims.”

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We can be reached for comment at media@techfreedom.org. See more of our work on consumer protection and FTC reform, including:

  • A white paper on the FTC’s questionable application of its enforcement authority against Nomi Technologies over deceptive statements
  • Our statement on the FTC’s attempts to meddle in user experience decisions
  • Our statement on the FTC’s failure to prove likely injury in its case against LabMD

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