Amazon Antitrust Lawsuit Broadened by US Attorney General to Challenge Agreements With Third-Party Sellers

Amazon said that the Washington, DC, lawsuit had it wrong.

By Reuters | Updated: 14 September 2021 12:36 IST

Amazon Antitrust Lawsuit Broadened by US Attorney General to Challenge Agreements With Third-Party Sellers

Washington, DC sued Amazon alleging its requirements barred third-party sellers from selling elsewhere

Highlights

Amazon filed a motion to dismiss the lawsuit on Friday
The new complaint alleges that Amazon has agreements with wholesalers
The payments are disincentive for wholesalers to lower prices to compete

Washington, DC, has broadened its antitrust lawsuit against Amazon to challenge the online retailer's agreements with wholesalers as well as third-party sellers, city Attorney General Karl Racine's office said on Monday.

The city sued Amazon in May alleging its requirements barred third-party sellers from selling elsewhere for less than on Amazon. Amazon's prices include fees, which are up to 40 percent of the total price.

The new complaint includes allegations that Amazon has agreements with wholesalers that guarantee it a minimum profit. As a result, the complaint alleges, if Amazon lowers a price to compete with another online seller, the wholesaler must pay Amazon the difference between the price it sells at and the agreed minimum. These payments are a disincentive for wholesalers to lower prices to compete, the complaint said.

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Amazon, which filed a motion to dismiss the lawsuit on Friday, said that the Washington, DC, lawsuit had it wrong.

"Sellers set their own prices for the products they offer in our store," it said in a statement. "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."

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© Thomson Reuters 2021

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