Amazon is coming under fire yet again, as Ars Technica reports, for policies that reportedly forbade its online retailers from selling their products for lower prices on other websites. Critics are noting that this has caused higher prices for its customers for years, rather than allowing markets to determine fairer prices.
On September 14th, an Amazon spokesperson spoke to Ars after California Attorney General Rob Bonta announced a lawsuit against Amazon for allegedly blocking price competition in California. “Similar to the DC Attorney General—whose complaint was dismissed by the courts—the California Attorney General has it exactly backwards,” the spokesperson said.
“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.”
“For years, California consumers have paid more for their online purchases because of Amazon’s anticompetitive contracting practices,” state attorney general Rob Bonta said in a statement. https://t.co/UzrE17wn66
— The Washington Post (@washingtonpost) September 14, 2022
BREAKING: California AG Rob Bonta announces the state is suing Amazon, claiming anti-competitive practices causing increased consumer prices.
“The company broke the law, and stifled competition for years, causing increased prices for families across California,” he said.
— Ashley Zavala (@ZavalaA) September 14, 2022
Bonta, however, adamantly disagreed with Amazon, noting in his press release that Amazon’s “agreements thwart the ability of other online retailers to compete, contributing to Amazon’s dominance in the online retail marketplace and harming merchants and consumers through inflated fees and higher prices.” He added, “The reality is: Many of the products we buy online would be cheaper if market forces were left unconstrained. With today’s lawsuit, we’re fighting back.”
Back in May 2021, the District of Columbia sued Amazon for this very same reason and lost in court in March 2022. One month later, the Department of Justice issued a statement in support of the DC’s case. Shortly after this, the DC filed to appeal this August. Previously, another Amazon spokesperson spoke to Politico regarding the DC lawsuit, and said that “sellers set their own prices for the products they offer in our store.” The spokesperson then implied that without Amazon’s commitment to highlighting “competitively priced items above others, prices in the market would go up,” as Ars adds, and not “decrease as critics suggest.”
California Attorney General Rob Bonta filed a lawsuit against Amazon on Wednesday, claiming the online retail giant inflated prices for consumers and stifled competition with other online retailers by forcing merchants into agreements that violate the state’s antitrust laws. pic.twitter.com/xNwBLtnKkF
— Forbes (@Forbes) September 14, 2022
California takes aim at Amazon by filing a new antitrust lawsuit against the tech giant this week. California Attorney General Rob Bonta joins @CNBCTechCheck to discuss the lawsuit and more. https://t.co/J43fSCEKLS pic.twitter.com/dEQ7yo7Z3W
— CNBC (@CNBC) September 16, 2022
Ultimately, Bonta’s recent lawsuit asks the San Francisco Superior Court to issue an order that “stops Amazon’s anticompetitive behavior and recovers the damages to California consumers and the California economy.” As this goes farther than just preventing Amazon from anticompetitive practices, Bonta’s objective is to get Amazon to “compensate for the harms to consumers through increased prices” (an amount that has not been determined yet).
A California Department of Justice spokesperson also told Ars that this amount “will be determined by the court, but the harm we’re alleging is significant. To think about the size, you may want to consider what it means if every Californian has paid even just a little more for every product they purchased online over the span of a decade.”
