• by Wendy Davis  @wendyndavis, June 28, 2024

A federal appellate court has rejected Amazon users' request for a new hearing over claims that the company wrongly targets ads to consumers based on their interactions with Alexa-enabled devices.

The move leaves in place an opinion issued in May, when a three-judge appellate panel upheld a trial judge's dismissal of the claims.

The refusal to reconsider that ruling appears to bring an end to a battle dating to 2022, when Ohio resident James Gray and Massachusetts resident Scott Horton alleged in a class-action complaint that Amazon violated Alexa users' privacy, and engaged in misleading and unfair conduct, by serving targeted ads based on voice interactions.

They sued after researchers from the University of Washington, University of California-Davis, University of California-Irvine, and Northeastern University posted the report “Your Echoes are Heard: Tracking, Profiling, and Ad Targeting in the Amazon Smart Speaker Ecosystem,” which concluded that Amazon “processes voice data to infer user interests.”

The researchers didn't allege that Amazon secretly listened to conversations, or directly shared voice recordings with third parties.

Amazon responded to the report by acknowledging that it targeted ads to consumers based on their transactions with Alexa.

“Similar to what you'd experience if you made a purchase on Amazon.com or requested a song through Amazon Music, if you ask Alexa to order paper towels or to play a song on Amazon Music, the record of that purchase or song play may inform relevant ads shown on Amazon or other sites where Amazon places ads,” the company stated in response to the research paper.

Amazon added that it “is not in the business of selling data,” and doesn't share Alexa requests with ad networks.

U.S. District Court Judge Barbara Rothstein in Seattle dismissed the complaint, ruling that Amazon notified users about its practices in a privacy policy.

Gray and Horton appealed to the 9th Circuit, where they argued that Amazon's privacy disclosures were “at best ambiguous,” and that its “Alexa-specific” policies don't say anything about targeted advertising.

A three-judge appellate panel ruled against the users in May, writing in an unsigned opinion that Rothstein “correctly found that Amazon disclosed the relevant conduct in its privacy notice.”

Gray and Horton subsequently sought a new hearing at the 9th Circuit. They argued in papers filed May 30 that the panel's ruling could encourage companies to make only vague privacy disclosures.

“It is undisputed that there is not one single disclosure in Amazon’s Privacy Notice, or any other documentation constituting its user agreement, that says that Alexa voice recordings may be used to target ads,” counsel wrote.

Lawyers for the pair added that the panel's ruling “will greatly incentivize companies to be intentionally vague to obscure the true purpose for which they use customer data.”

The 9th Circuit on June 25 denied the request for a new hearing, writing that none of the circuit's judges requested a vote on the matter.