Amazon has been sued by the Federal Trade Commission and 17 state attorneys general. The US regulator and 15-plus states are suing the e-tailer over allegations that the company abuses its position in the marketplace to inflate prices on and off its platform, overcharge sellers and stifle competition. This is one of the most significant legal challenges that Amazon is facing in its nearly 30-year history. The lawsuit has been filed in federal court in Amazon’s home state of Washington and is said to be the result of a years-long investigation into the company’s businesses.
What the lawsuit claims
The complaint alleges that Amazon violates the law not because it is big, but because it engages in a course of exclusionary conduct that prevents current competitors from growing and new competitors from emerging. By stifling competition on price, product selection, quality, and by preventing its current or future rivals from attracting a critical mass of shoppers and sellers, Amazon ensures that no current or future rival can threaten its dominance. Amazon’s far-reaching schemes impact hundreds of billions of dollars in retail sales every year, touch hundreds of thousands of products sold by businesses big and small and affect over a hundred million shoppers.
“Our complaint lays out how Amazon has used a set of punitive and coercive tactics to unlawfully maintain its monopolies,” said FTC Chair Lina M Khan. “The complaint sets forth detailed allegations noting how Amazon is now exploiting its monopoly power to enrich itself while raising prices and degrading service for the tens of millions of American families who shop on its platform and the hundreds of thousands of businesses that rely on Amazon to reach them. Today’s lawsuit seeks to hold Amazon to account for these monopolistic practices and restore the lost promise of free and fair competition.”
“We’re bringing this case because Amazon’s illegal conduct has stifled competition across a huge swath of the online economy. Amazon is a monopolist that uses its power to hike prices on American shoppers and charge sky-high fees on hundreds of thousands of online sellers,” said John Newman, Deputy Director of the FTC’s Bureau of Competition. “Seldom in the history of U.S. antitrust law has one case had the potential to do so much good for so many people.”
States that have joined the lawsuit
The US states that have filed the lawsuit along with FTC include: Connecticut, Delaware, Maine, Maryland, Massachusetts, Michigan, Minnesota, New Jersey, New Hampshire, New Mexico, Nevada, New York, Oklahoma, Oregon, Pennsylvania, Rhode Island, and Wisconsin joined the lawsuit against Amazon. In addition to the lawsuit in California, the District of Columbia has also sued Amazon over its treatment of third-party sellers. That lawsuit was thrown out by a federal judge earlier last year and is currently under appeal.
What may be the result of the lawsuit
There has been speculation that the agency would seek a forced breakup of the retail giant. However, in a briefing with reporters, Khan dodged questions of whether that would happen. “At this stage, the focus is more on liability,” she reportedly said.
What the lawsuit claims
The complaint alleges that Amazon violates the law not because it is big, but because it engages in a course of exclusionary conduct that prevents current competitors from growing and new competitors from emerging. By stifling competition on price, product selection, quality, and by preventing its current or future rivals from attracting a critical mass of shoppers and sellers, Amazon ensures that no current or future rival can threaten its dominance. Amazon’s far-reaching schemes impact hundreds of billions of dollars in retail sales every year, touch hundreds of thousands of products sold by businesses big and small and affect over a hundred million shoppers.
“Our complaint lays out how Amazon has used a set of punitive and coercive tactics to unlawfully maintain its monopolies,” said FTC Chair Lina M Khan. “The complaint sets forth detailed allegations noting how Amazon is now exploiting its monopoly power to enrich itself while raising prices and degrading service for the tens of millions of American families who shop on its platform and the hundreds of thousands of businesses that rely on Amazon to reach them. Today’s lawsuit seeks to hold Amazon to account for these monopolistic practices and restore the lost promise of free and fair competition.”
“We’re bringing this case because Amazon’s illegal conduct has stifled competition across a huge swath of the online economy. Amazon is a monopolist that uses its power to hike prices on American shoppers and charge sky-high fees on hundreds of thousands of online sellers,” said John Newman, Deputy Director of the FTC’s Bureau of Competition. “Seldom in the history of U.S. antitrust law has one case had the potential to do so much good for so many people.”
States that have joined the lawsuit
The US states that have filed the lawsuit along with FTC include: Connecticut, Delaware, Maine, Maryland, Massachusetts, Michigan, Minnesota, New Jersey, New Hampshire, New Mexico, Nevada, New York, Oklahoma, Oregon, Pennsylvania, Rhode Island, and Wisconsin joined the lawsuit against Amazon. In addition to the lawsuit in California, the District of Columbia has also sued Amazon over its treatment of third-party sellers. That lawsuit was thrown out by a federal judge earlier last year and is currently under appeal.
What may be the result of the lawsuit
There has been speculation that the agency would seek a forced breakup of the retail giant. However, in a briefing with reporters, Khan dodged questions of whether that would happen. “At this stage, the focus is more on liability,” she reportedly said.
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