Janice R. Andrews
An appeals court has brought back to life a trade case that was originally brought by the Attorney General of Washington, DC. This means that Amazon’s business practices will be looked at more closely. The case, which was first filed in 2021, says that Amazon’s methods have caused prices to be too high for customers by making third-party sellers agree to strict terms.
The case, which was started by Karl Racine, who used to be the attorney general of the District of Columbia, is about Amazon’s deals with third-party sellers. It is said that these contracts stopped sellers from selling their goods at cheaper prices on sites other than Amazon. This made the whole online shopping market have a “artificially high price floor.” Later, Racine’s office added Amazon’s pricing strategies for wholesalers to the case. They said the company was hurting both customers and competition by these actions.
Amazon has always rejected these claims, saying that its pricing policies are meant to help customers by pushing goods with low prices. A lower court, though, threw out the case in 2022. The latest ruling by the appeals court overturned that dismissal, so the case can now go forward. The judge said that the District’s claims suggest that Amazon may already have a stranglehold in the online market or is very close to getting one. This ruling is a big step forward in the current investigation into Amazon’s market dominance.
According to Amazon spokesperson Tim Doyle, the claims are not true. He said, “We look forward to presenting facts in court that demonstrate how good these policies are for consumers.” This is how we think things will work out in the long run for both buyers and sellers.
This new round of the case adds to Amazon’s growing competition problems. More than a dozen states and the Federal Trade Commission (FTC) have filed a new case against the company. There is also a probe into Amazon’s $4 billion investment in the AI company Anthropic by the UK’s antitrust regulator.
In a statement, Brian Schwalb, who is currently Attorney General of DC, said that the case was very important and that DC was the first place to sue Amazon for trade violations. He said that the district will keep working to stop what he called Amazon’s “unfair and unlawful practices,” which he says have caused prices to go up for customers and less innovation and choice in the online shopping market. The case has been brought up again, which means Amazon will continue to face legal problems as officials continue to closely watch how it does business.
