California Attorney General Rob Bonta launched a lawsuit against Amazon Wednesday for alleged illegal practices he says hindered competition and spurred price increases in the state.
Amazon allegedly hurt other online retailers’ competitive ability through agreements punishing merchants if their products are available for lower prices elsewhere, according to the lawsuit. It claims resulting fee and price inflation negatively impacts merchants and consumers and accuses the company of violating the California’s Unfair Competition Law and Cartwright Act.
#BREAKING: We’re suing @Amazon for blocking price competition.
Amazon coerces merchants into deals that keep prices artificially high, knowing full well they have no real alternative.
We won’t let Amazon bend the market to its will at the expense of consumers and the economy.
— Rob Bonta (@AGRobBonta) September 14, 2022
“The reality is: Many of the products we buy online would be cheaper if market forces were left unconstrained,” Bonta said. “With today’s lawsuit, we’re fighting back. We won’t allow Amazon to bend the market to its will at the expense of California consumers, small business owners, and a fair and competitive economy.”
The lawsuit seeks to stop Amazon from engaging in the agreements and “return its ill-gotten gains and pay penalties to serve as a deterrent to other companies contemplating similar actions,” according to the press release.
“Similar to the D.C. Attorney General—whose complaint was dismissed by the courts—the California Attorney General has it exactly backwards,” an Amazon spokesperson told the Daily Caller News Foundation. “Sellers set their own prices for the products they offer in our store. 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.”
“The relief the AG seeks would force Amazon to feature higher prices to customers, oddly going against core objectives of antitrust law,” the spokesperson continued. “We hope that the California court will reach the same conclusion as the D.C. court and dismiss this lawsuit promptly.”
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