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Grube v. Amazon.Com, Inc.

United States District Court, D. New Hampshire

September 6, 2017

Carrie Grube
v.
Amazon.com, Inc., et al. Opinion No. 2017 DNH 179

          ORDER

          Landya McCfferty, United States District Judge

         In early 2015, Carrie Grube discovered that her credit card had been charged more than $2, 500 for in-app purchases made on her children's Amazon Kindle Fire devices. After unsuccessfully disputing the charges with her credit card issuer, Synchrony Bank (“Synchrony”), Grube brought suit against Synchrony and Amazon.com, Inc. (“Amazon”) for violations of state and federal law. Defendants now move for summary judgment on all claims. Grube objects and moves for summary judgment on her federal claim against Synchrony. For the reasons that follow, the court grants defendants' motion and denies Grube's motion.

         STANDARD OF REVIEW

         Cross motions for summary judgment proceed under the same standard applicable to all motions for summary judgment, but the motions are addressed separately. Fadili v. Deutsche Bank Nat'l Tr. Co., 772 F.3d 951, 953 (1st Cir. 2014). A movant is entitled to summary judgment if it “shows that there is no genuine dispute as to any material fact and [that it] is entitled to judgment as a matter of law.” Fed.R.Civ.P. 56(a). In reviewing the record, the court construes all facts and reasonable inferences in the light most favorable to the nonmovant. Kelley v. Corr. Med. Servs., Inc., 707 F.3d 108, 115 (1st Cir. 2013).

         BACKGROUND

         Amazon operates an Appstore, in which customers can view and download applications to use on smartphones and Amazon's Kindle Fire tablets. Within certain applications, users can make “in-app purchases” to enhance an application. See doc. no. 25-2 at ¶ 2.

         I. Amazon's In-App Purchasing System

         In 2011, when Amazon first implemented its in-app purchasing system, children could make in-app purchases without parental consent and without inputting a password.[1] Between 2011 and June 2014, Amazon made changes to its in-app purchasing system, including requiring passwords before certain in-app purchases, adding parental control features, and providing better notice in its Appstore interface about in-app purchasing. Then, in June 2014, Amazon implemented a refined first-time purchase prompt that required account holders both to enter their password before making the first in-app purchase on a device and to select whether they would like to require a password for future in-app purchases.

         In July 2014, the Federal Trade Commission (“FTC”) brought suit against Amazon, challenging its in-app purchasing system dating back to November 2011. See Amazon.com, 2016 U.S. Dist. LEXIS 55569, at *7. The Western District of Washington held that Amazon's in-app purchasing system and billing practices between November 2011 and June 2014 violated the FTC Act. The court concluded that during that period, customers were charged for in-app purchases that were made without their authorization. The court concluded that Amazon's unfair billing practices continued until June 3, 2014, when Amazon made changes to the in-app purchasing prompts that “clearly informed [users] both about the existence of in-app purchases and the scope of their consent . . . .” Id. at *23-24.

         II. Facts Related to Plaintiff's Case

         In late 2014, after Amazon had instituted the changes to its in-app purchasing protections, Carrie Grube purchased two Amazon Kindle Fire HD tablets: one for her nine-year old son and the other for her five-year-old daughter. She registered the Kindle devices with her Amazon account. As part of the registration process, Grube agreed to Amazon's “Conditions of Use, ” which governs use of the Appstore on each Kindle. Grube linked her Amazon-branded credit card, issued by Synchrony, as the method of payment for her Amazon account. Grube created a password for purchases on each Kindle device and did not share those passwords with her children. The password for her son's Kindle was the four digit combination of the month and date of his birthday.

         At the time Grube purchased the Kindle devices, Amazon had instituted the following safeguards to protect against unauthorized purchases:

• First-Time Purchase Prompt: When a user attempts to complete an in-app purchase on a Kindle device for the first time, she is prompted to enter the Amazon password associated with the device. Additionally, the user is prompted to make an affirmative choice whether to require the password for all future in-app purchases, which enables a Parental Controls feature.
• Parental Controls: Amazon account holders can enable the Parental Controls feature on the Kindle at any time in the device settings menu. With Parental Controls enabled, a Parental Controls password is required for all in-app purchases.
• Disable In-App Purchasing: Users can disable in-app purchasing on a Kindle altogether through the Parental Controls menu.
• High-Price Password: Even if Parental Controls is disabled on a device, all in-app purchases of $19.99 or more require successful entry of the account holder's password.
• Password for Specified Apps: Certain apps that have been designed for use by children require a password for in-app purchases. Once the customer enters a password for an in-app purchase, a 15-minute purchasing window opens in which purchases can be made without additional password entry.
• High-Frequency Password: Password entry is required when a customer attempts to make a second in-app purchase within a five-minute period. Entering the account password opens a 60-minute purchasing window.
• Notice About In-App Purchases: For apps that allow in-app purchasing, the app details page in the Amazon Appstore lists “In-App Purchasing” under the “Key Details” heading and contains the following information: “NOTE: This app contains in-app purchasing, which allows you to buy items within the app using actual money. On Amazon devices, you can configure parental controls from the device Settings menu by selecting Parental Controls.” Doc. no. 25-5.
• Immediate Order-Confirmation Emails: After each in-app purchase, Amazon sends an immediate order-confirmation email to the email address associated ...

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