California filed an antitrust lawsuit against Amazon, alleging the company violated state competition law through its pricing rules.
Engadget reports that California filed an antitrust lawsuit alleging that Amazon violated both the Cartwright Act and the state’s competition law through its pricing rules. Attorney General Rob Bonta has accused the e-commerce giant of stifling competition by preventing sellers from offering their items at lower prices on other sites.
If third-party sellers offer their items at cheaper prices on other platforms, they risk losing buy buttons, important listings, or even market access from Amazon. If the lawsuit is successful, Amazon will be barred from participating in any contract deemed anti-competitive and must inform sellers that they are free to reduce prices on other platforms.
Amazon would also be required to pay damages, return “ill-gotten gains” and appoint a court-approved monitor. In a statement, Amazon said the state of California had the situation “exactly upside down.” Amazon says third-party sellers still have control over pricing, and inclusion in the “Buy Box” space shows a deal is competitive. Amazon further argued that the lawsuit would raise prices.
Amazon’s full statement on the latest antitrust lawsuit below:
“Similar to the DC Attorney General – whose complaint was dismissed by the courts – the California Attorney General has the exact opposite. Sellers set their own prices for the products they offer in our store. Amazon prides itself on offering low prices on the widest selection, and like any store, we reserve the right not to push offers to customers that are not price competitive. The remedy sought by the AG would force Amazon to offer higher prices to customers, which would strangely run counter to the fundamental objectives of antitrust law. We hope the California court will come to the same conclusion as the DC court and quickly dismiss this lawsuit.
Amazon has come under intense scrutiny over its practices in recent months. Breitbart News recently reported that more than two dozen groups that criticize Amazon’s anti-competitive and invasive surveillance practices urged the FTC to block the company’s acquisition of iRobot. The coalition, which includes Fight for the Future, Electronic Frontier Foundation, International Brotherhood of Teamsters and Public Citizen, wrote to the FTC about the recent $1.7 billion cash deal to buy iRobot.
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Lucas Nolan is a reporter for Breitbart News covering free speech and online censorship issues. Follow him on Twitter @LucasNolan