Amazon faces potential lawsuit by the FTC over in-app purchases made by children

Amazon says that the Kindle Fire is its bestselling product.

Amazon says that the Kindle Fire is its bestselling product.

Amazon is fighting claims by the Federal Trade Commission, which charge that it failed to get parents’ permission for purchases made by children inside applications on its Kindle Fire tablets.

The Federal Trade Commission’s investigation into the Seattle retailer’s practices are not public, however, The Wall Street Journal reports it was able to obtain documents sent yesterday by Amazon to the FTC, outlining Amazon’s response to the potential lawsuit.

UPDATE: Amazon has provided the letter it sent to the FTC and it has been inserted in full below.

In the document, Amazon said it was prepared to defend its position in court, rather than agree to fines and disclosure agreements. Amazon’s Associate General Counsel Andrew DeVore also told the WSJ: “When customers told us their kids had made purchases they didn’t want, we refunded those purchases.”

He also said Amazon’s app store included “prominent notice of in-app purchasing, effective parental controls and real-time notice of every in-app purchase.”

The FTC is essentially asking that Amazon comply to the same rules that Apple agreed to earlier this year in regards to in-app purchases, but Amazon states, “The Commission’s unwillingness to depart from the precedent it set with Apple despite our very different facts leaves us no choice but to defend our approach in court.”

The FTC would not confirm or deny the existence of this investigation in a statement provided to GeekWire.

However, the spokesman said: “As our cases including yesterday’s action against T-Mobile demonstrate, the Commission is focused on ensuring that companies comply with the fundamental principle that consumers should not be made to pay for something they did not authorize. Consumers using mobile devices have the same long-established and fundamental consumer protections as they would anywhere else.”

Amazon’s in hot water over its Kindle Fire tablets, and purchases made inside applications, such as buying additional lives inside a game or more bails of hay for your virtual farm. The FTC is asking Amazon to make notices more prominent, require passwords for all purchases and make refunds simpler to request.

Amazon FTC letter