California’s Attorney General Rob Bonta announced a lawsuit against Amazon alleging antitrust law violations by blocking price competition and pushing up prices for consumers.
The 84-paged lawsuit filed in San Fransisco Superior Court alleges that Amazon stifled competition and caused increased prices across California through anticompetitive contracting practices in violation of California’s Unfair Competition Law and Cartwright Act.
"Amazon makes consumers think they are getting the lowest prices possible," the lawsuit alleges, "when in fact, they cannot get the low prices that would prevail in a freely competitive market because Amazon has coerced and induced its third-party sellers and wholesale suppliers to enter into anti-competitive agreements on price."
California’s lawsuit against Amazon seeks a court order to halt the company’s alleged anti-competitive behavior and recover the damages to California consumers and the economy. According to Bonta’s office, Amazon avoids competing prices with other online e-commerce sites by requiring merchants to enter into agreements that severely penalize them if their products are offered lower prices elsewhere.
“These agreements thwart the ability of other online retailers to compete, contributing to Amazon's dominance in the online retail marketplace and harming merchants and consumers through inflated fees and higher prices,” Bonta’s office wrote in a statement.
The company told media that the California attorney general “has it exactly backward” and that “sellers set their own prices” on the website.
“Amazon takes pride in the fact that we offer low prices across the broadest selection, and like any store we reserve the right not to highlight offers to customers that are not priced competitively,” Amazon spokesperson Alex Haurek said in a statement. “The relief the AG seeks would force Amazon to feature higher prices to customers, oddly going against core objectives of antitrust law.”
A similar lawsuit was filed against Amazon in May 2021 in the District of Colombia, but it was dismissed.
