Amazon Faces Antitrust Lawsuit By FTC And 17 States

(RTTNews) - The FTC and 17 state attorneys general have filed an antitrust lawsuit against Amazon, accusing the e-commerce giant of monopolistic practices. The complaint alleges that Amazon's actions stifle competition by preventing rivals and sellers from lowering prices, degrading product quality, overcharging sellers, stifling innovation, and inhibiting fair competition.

The lawsuit argues that Amazon's antitrust violations result from a pattern of exclusionary behavior rather than its sheer size. Amazon's strategies hinder current competitors from growing and new ones from emerging, maintaining its market dominance. These practices impact a significant portion of the retail market, influencing countless products and millions of consumers.

FTC Chair Lina M. Khan stated, "Our complaint details Amazon's coercive tactics to unlawfully preserve its monopolies." She emphasized that Amazon's monopoly power has led to higher prices and declining service for millions of American families and businesses. The lawsuit aims to restore free and fair competition and hold Amazon accountable.

John Newman, Deputy Director of the FTC's Bureau of Competition, noted the lawsuit's potential to benefit many, saying, "Seldom in U.S. antitrust history has one case held such promise."

The FTC and state attorneys general identify Amazon's anticompetitive practices in two main markets: the online superstore serving shoppers and the online marketplace services used by sellers. These practices include measures that discourage sellers from offering lower prices than Amazon, maintaining higher prices across the internet.

Additionally, Amazon's requirement for sellers to use its costly fulfillment service to qualify for "Prime" eligibility limits competition from other platforms.

Amazon's exclusionary conduct hinders competition by favoring paid advertisements over organic search results, biasing search results toward its products, and imposing high fees on sellers, leading to increased prices for consumers.

The FTC and state partners seek a permanent injunction to prohibit Amazon's unlawful conduct and restore competition. Connecticut, Delaware, Maine, Maryland, Massachusetts, Michigan, Minnesota, New Jersey, New Hampshire, New Mexico, Nevada, New York, Oklahoma, Oregon, Pennsylvania, Rhode Island, and Wisconsin have joined the lawsuit. The Commission's vote to authorize staff to seek relief was unanimous.