Ekin v. Amazon Services LLC

Filing 1

COMPLAINT - CLASS ACTION against defendant(s) Amazon Services LLC (Receipt # 0981-3512468) Attorney Stephen John Sirianni added to party A. Cemal Ekin(pty:pla), filed by A. Cemal Ekin. (Attachments: # 1 Civil Cover Sheet, # 2 Summons)(Sirianni, Stephen)

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UNITED STATES DISTRICT COURT
WESTERN DISTRICT OF WASHINGTON
AT SEATTLE

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DR. A. CEMAL EKIN, individually and on
behalf of similarly situated individuals,
Plaintiff,

NO. 2:14-cv-00244
COMPLAINT – CLASS ACTION

v.
AMAZON SERVICES LLC, a Nevada limited
liability company,

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Defendant.

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I.

JURY DEMAND

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1.1

Plaintiff Ekin.

PARTIES

A. Cemal Ekin, Ph.D. (“Dr. Ekin” or “Plaintiff”) is a

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resident of the state of Rhode Island. Dr. Ekin, individually and on behalf of a class of

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persons and/or entities similarly situated, brings this action for damages and such

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other relief as may be available against Defendant.

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1.2

Defendant Amazon. Amazon Services LLC (“Amazon” or “Defendant”)

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is a Nevada limited liability company headquartered in Seattle, Washington. It, and

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Amazon.com and affiliates, form the world’s largest online retailer.

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II. JURISDICTION AND VENUE

2.1

Jurisdiction.

This Court has subject matter jurisdiction by virtue of

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diversity of citizenship. 28 U.S.C. 1332. Plaintiff is a citizen and resident of Rhode

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Island. Defendant is a Nevada limited liability company headquartered in the state of

COMPLAINT – CLASS ACTION – 1
[Case No. 2:14-cv-00244]

SIRIANNI YOUTZ
SPOONEMORE HAMBURGER
999 THIRD AVENUE, SUITE 3650
SEATTLE, WASHINGTON 98104
TEL. [phone] FAX [phone]

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Washington.

It is wholly owned by Amazon.com, Inc., a Delaware corporation

headquartered in the state of Washington. The amount in controversy exceeds $75,000
exclusive of interest and costs.
2.2

Venue. Under the Terms and Conditions of Plaintiff’s and each proposed

class member’s Amazon Prime Program membership agreement, which incorporates
Amazon’s Conditions of Use agreement:

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Any dispute … in which the aggregate total claim for relief
sought on behalf of one or more parties exceeds $7,500 shall
be adjudicated in any state or federal court in King County,
Washington…. [That court shall have] exclusive jurisdiction
and venue.

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III. FACTUAL ALLEGATIONS

3.1

The Amazon Prime Program. Throughout the class period, purchasers on

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Amazon.com could join the Amazon Prime Program (“Prime Program”) by paying

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Amazon a $79 annual membership fee.

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Program Members” would receive free shipping for items: (a) purchased from third-

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party vendors that participate in the Prime Program; and (b) designated on the relevant

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website as

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on items designated as Prime-Eligible was the exclusive benefit of Prime Program

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membership. The term “Prime-Eligible” refers to all goods for sale on the relevant

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website that are designated

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3.2

In return, Amazon agreed that “Prime

. Until February 22, 2011 (the end of the class period), free shipping

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Amazon’s Agreement that Shipping Charges Would Not Be Included in

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Prices of Items Offered as Prime Eligible. In return for the annual $79 Prime Program

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membership fee, Amazon promised and agreed with Prime Program Members: (a) to

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provide free shipping on any and all Prime Program Member purchases of Prime-

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Eligible items; and (b) that shipping charges would not be included in the prices of

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items offered for sale as Prime Eligible.

COMPLAINT – CLASS ACTION – 2
[Case No. 2:14-cv-00244]

SIRIANNI YOUTZ
SPOONEMORE HAMBURGER
999 THIRD AVENUE, SUITE 3650
SEATTLE, WASHINGTON 98104
TEL. [phone] FAX [phone]

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3.3

Third-Party Vendor Participants. Fulfillment by Amazon (“FBA”) is a

service offered by Amazon to third-party vendors. Under FBA, the third-party vendor
pays Amazon certain fees. In return, Amazon warehouses goods, fills orders, boxes
and ships, provides customer service and handles returns, and provides payment
collection on third-party-owned goods sold on Amazon.com and other websites.
Third-party vendors who participate in the FBA are referred to as “FBA Vendors.”
Amazon allows and encourages FBA Vendors to list items for sale as Prime-Eligible,
thus promising that the items would be sold without charging for shipping.
3.4

Amazon Induces FBA Vendors to Mark Up the Prices of Prime-Eligible

Items to Include Shipping Charges. During the class period: (a) Amazon advised FBA
Vendors to include the amount they would have charged for shipping in their item
prices in order to maximize total revenue and profit margins; and (b) FBA Vendors
increased their prices to Prime Program Members by the amount they charged others
for shipping without revealing that a portion of those prices was for shipping fees.
Amazon disguised this price increase by giving priority to FBA Vendors, showing their
items first in the results of a Prime Member’s product search.
3.5

Raising Prime-Eligible Item Prices by Shipping Charges Increases

Amazon’s FBA Fees and Allows Amazon to Capture its Shipping Costs. Amazon
charges FBA Vendors a “referral fee,” which is a percentage of the price of the PrimeEligible item. Increasing an FBA item price by an amount equal to normal shipping
charges—as recommended by Amazon—results in (a) a higher referral fee paid by FBA
Vendors to Amazon; and (b) the direct and immediate recovery by Amazon, in whole
or in part, of its cost of “free” shipping, contrary to its contractual obligations to Prime
Program Members, and contrary to FTC guidelines, which read:

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COMPLAINT – CLASS ACTION – 3
[Case No. 2:14-cv-00244]

SIRIANNI YOUTZ
SPOONEMORE HAMBURGER
999 THIRD AVENUE, SUITE 3650
SEATTLE, WASHINGTON 98104
TEL. [phone] FAX [phone]

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(b) Meaning of “Free.”

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(1) (W)hen the purchaser is told that an article is “Free” to
him if another article is purchased, the word “Free” indicates
that he is paying nothing for that article and no more than
the regular price for the other. Thus, a purchaser has a right
to believe that the merchant will not directly and
immediately recover, in whole or in part, the cost of the free
merchandise or service by marking up the price of the article
which must be purchased….

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16 C.F.R. § 251.1(b)(1) (underlining added).
3.6

Dr. Ekin’s Prime Program Membership. From December 2008 through

December 2010, Dr. Ekin was an Amazon Prime Program Member and paid the annual
membership fee of $79 to Amazon. In return for the $79 annual membership fee,
Amazon promised Dr. Ekin, like all Prime Program Members, free shipping on his
Prime-Eligible purchases, and that the prices of Prime-Eligible items would not be
increased by the inclusion of shipping charges.
3.7

Amazon’s Breach of Obligation to Dr. Ekin and Other Prime Program

Members. Because Amazon induced FBA Vendors to include shipping charges in the
prices of FBA Prime-Eligible items, Dr. Ekin and other Prime Program Members did
not receive the promised benefits. Instead, Amazon’s FBA pricing program resulted in
Prime-Eligible items being routinely offered for sale through FBA Vendors at prices
inflated by shipping charges as described above, despite Amazon’s free shipping
promise.
3.8

Resulting Harm to Dr. Ekin and Other Prime Program Members.

Dr. Ekin and other Prime Program Members were harmed and deceived by Amazon’s
activity because they paid the $79 annual Prime Program membership fee solely for the
benefit of free shipping. However, the prices of FBA items offered to them as Prime
Program Members were routinely inflated to include shipping charges.

COMPLAINT – CLASS ACTION – 4
[Case No. 2:14-cv-00244]

SIRIANNI YOUTZ
SPOONEMORE HAMBURGER
999 THIRD AVENUE, SUITE 3650
SEATTLE, WASHINGTON 98104
TEL. [phone] FAX [phone]

IV. APPLICABLE LAW

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4.1

Washington Law. The applicable Amazon-prepared agreements with

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Prime Program Members provide that Washington law applies to any and all claims of

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Prime Program Members, including Plaintiff and each proposed class member.
V. CLASS ACTION ALLEGATIONS

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5.1

The Class. Plaintiff brings this suit as a class action on behalf of himself

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and all other United States residents similarly situated as members of a proposed

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plaintiff class (“Class”) pursuant to Rule 23(b)(3). The Class is defined as follows:
All persons and entities residing in the United States who
became Amazon Prime members at any time from
October 24, 2007 until February 22, 2011, and paid one or
more $79 annual Prime membership fees during that Class
period.

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Excluded from this Class are: (a) defendant, any entity in
which defendant has a controlling interest or which has a
controlling interest in defendant; (b) defendant’s employees,
agents, predecessors, successors or assigns; (c) the judge and
staff to whom this case is now or hereafter assigned, and any
member of the judge’s immediate family; and (d) plaintiff’s
counsel and their immediate families.

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5.2

Numerosity. Upon information and belief, the Class consists of well over

one million members and is so numerous that individual joinder is impracticable.
5.3

Commonality and Predominance. Common questions of law and fact

predominate over any questions affecting only individual Class members. Some of the
common legal and factual questions include:

(a) whether shipping charges were

routinely included in the prices of FBA Prime-Eligible items; (b) whether the routine
inclusion of shipping charges in the prices of FBA Prime-Eligible items constitutes a
breach of Amazon’s promise to Prime Program Members that shipping charges would
not be included in the prices of items offered for sale as FBA Prime-Eligible;
(c) whether Washington law applies to the claims of all Class members; and
COMPLAINT – CLASS ACTION – 5
[Case No. 2:14-cv-00244]

SIRIANNI YOUTZ
SPOONEMORE HAMBURGER
999 THIRD AVENUE, SUITE 3650
SEATTLE, WASHINGTON 98104
TEL. [phone] FAX [phone]

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(d) whether Amazon’s activity was unfair and deceptive in trade or commerce,
adversely impacting the public interest.
5.4

Typicality. For the following non-inclusive reasons, Plaintiff’s claims are

typical of those of the Class members. (a) Plaintiff, like all Class members, became an
Amazon Prime Program Member during the period that the Terms and Conditions
governing his Amazon Prime Program membership provided that:

(i) disputes

involving an “aggregate total claim for relief sought on behalf of one or more parties
exceeds $7,500 shall be adjudicated in any state or federal court in King County,
Washington …”; and (ii) “the laws of the state of Washington … will govern … any
dispute of any sort that might arise between you and Amazon…”; and (b) Amazon
continually breached its promise to Plaintiff and Prime Program Members that
shipping charges would not be included in the prices of items offered for sale as FBA
Prime-Eligible.

Shipping charges were, throughout the Class period, routinely

included in the prices of FBA Prime-Eligible items.
5.5

Adequacy.

Plaintiff will fairly and adequately represent the Class

because his interests are not adverse to those of the Class and he suffered harm similar
to that suffered by the Class he seeks to represent.

He has retained experienced

counsel competent in class action litigation. The interests of the Class will be fairly and
adequately protected by Plaintiff and his counsel. Neither Plaintiff nor undersigned
counsel has any interest that may inhibit or obstruct the vigorous pursuit of this action.
5.6

Class Form Superior to All Other. This class action is superior to the

other available means for the fair and efficient resolution of the claims of Plaintiff and
the proposed Class members. The relief sought per individual member of the Class is
small relative to the burden and expense of prosecuting claims against Amazon. It
would be virtually impossible for the Class members to seek redress on an individual
basis. Given the similar nature of Class members’ claims and the contractual provision
COMPLAINT – CLASS ACTION – 6
[Case No. 2:14-cv-00244]

SIRIANNI YOUTZ
SPOONEMORE HAMBURGER
999 THIRD AVENUE, SUITE 3650
SEATTLE, WASHINGTON 98104
TEL. [phone] FAX [phone]

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designating the laws of the State of Washington as governing, a nationwide class could
be managed by this court. A significant economy of scale exists in concentrating the
litigation in this forum.
5.7

Individual Prosecution Unlikely and Unreasonable.

Plaintiff and his

counsel are not aware of any interest that members of the Class would have in
individually controlling the prosecution of separate actions, especially given: (a) the
relatively small size of each individual claim; and (b) the cost, expense and difficulty of
litigating against one of the largest companies in the United States. Plaintiff and his
counsel are not aware of any actions already commenced on behalf of members of the
Class alleging similar claims or seeking similar relief.

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VI. CAUSE OF ACTION: BREACH OF CONTRACT
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6.1

Incorporation.

The

preceding

paragraphs

are

re-alleged

and

incorporated herein.
6.2

Amazon’s Breach of Its Contractual Obligation to Prime Program

Members. The routine inclusion and encouragement of inclusion of shipping charges
in the prices of FBA Prime-Eligible items constitutes a breach of Amazon’s promise to
Prime Program Members that shipping charges would not be included in the prices of
items offered for sale as FBA Prime-Eligible, and violates Amazon’s agreement that
shipping would be “free.”
6.3

Loss and Causation. As a direct result of Amazon’s breach, Plaintiff and

the Class members were harmed by Amazon’s conduct, and Amazon was unjustly
benefited at the expense and to the detriment of Plaintiff and the Class members.

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VII. SECOND CAUSE OF ACTION: VIOLATIONS OF
WASHINGTON CONSUMER PROTECTION ACT

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7.1

Incorporation.

The

preceding

paragraphs

are

re-alleged

and

incorporated herein.

COMPLAINT – CLASS ACTION – 7
[Case No. 2:14-cv-00244]

SIRIANNI YOUTZ
SPOONEMORE HAMBURGER
999 THIRD AVENUE, SUITE 3650
SEATTLE, WASHINGTON 98104
TEL. [phone] FAX [phone]

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7.2

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7.2.1

7.2.2

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Amazon’s conduct, described above, was unfair and deceptive in

trade and commerce.

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Amazon had a statutory duty to refrain from unfair or deceptive

acts or practices in trade and commerce.

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Washington Consumer Protection Act Violations.

7.2.3

Amazon’s unfair and deceptive conduct in trade and commerce,

described above, impacted the public interest, and Plaintiff and the Class he seeks to
represent were proximately harmed as a result.
7.3

Consumer Protection Act Relief. The Washington Consumer Protection

Act entitles Plaintiff and Class members to actual damages and other relief, such as
attorneys’ fees, costs and treble damages, as provided for in RCW 19.86.

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VIII. RELIEF REQUESTED
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Plaintiff requests the following relief:
8.1

Class Certification.

Certification of the action as a class action and

appointment of Plaintiff as Class representative and his counsel of record as Class
counsel;
8.2

Damages. An award of actual/compensatory damages in an amount to

be proven, and consisting of, among other things, a refund of all annual Prime Program
membership fees paid during the Class period;
8.3

CPA Damages.

Treble damages as provided under the Washington

Consumer Protection Act;
8.4

Attorneys’ Fees and Costs. The costs of bringing this suit, and reasonable

attorneys’ fees and costs for prosecuting it;
8.5

Interest. Pre- and post-judgment interest on all amounts as permitted by

law; and

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COMPLAINT – CLASS ACTION – 8
[Case No. 2:14-cv-00244]

SIRIANNI YOUTZ
SPOONEMORE HAMBURGER
999 THIRD AVENUE, SUITE 3650
SEATTLE, WASHINGTON 98104
TEL. [phone] FAX [phone]

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8.6

Other Relief. All further relief, of any type or nature, that this Court

determines is just, equitable or necessary.

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IX. JURY DEMAND
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9.1

Plaintiff respectfully demands a trial by jury.

DATED: February 19, 2014.

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SIRIANNI YOUTZ
SPOONEMORE HAMBURGER

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By s/ Stephen J. Sirianni
By s/ Chris R. Youtz
By s/ Richard E. Spoonemore
By s/ Eleanor Hamburger
By s/ Charles D. Sirianni
Stephen J. Sirianni (WSBA #6957)
Chris R. Youtz (WSBA #7786)
Richard E. Spoonemore (WSBA #21833)
Eleanor Hamburger (WSBA # 26478)
Charles D. Sirianni (WSBA #40421)

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999 Third Avenue, Suite 3650
Seattle, WA 98104
Tel. [phone]
Fax [phone]
[e-mail]
[e-mail]
[e-mail]
[e-mail]
[e-mail]

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Co-counsel for Plaintiff

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—and—

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DAVID M. SIMMONDS
By s/ David M. Simmonds
David M. Simmonds (WSBA # 6994)

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c/o SIRIANNI YOUTZ SPOONEMORE HAMBURGER

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Co-counsel for Plaintiff
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COMPLAINT – CLASS ACTION – 9
[Case No. 2:14-cv-00244]

SIRIANNI YOUTZ
SPOONEMORE HAMBURGER
999 THIRD AVENUE, SUITE 3650
SEATTLE, WASHINGTON 98104
TEL. [phone] FAX [phone]