Amazon's Vow to Stop Squeezing Its Sellers Was Fake, Says California's Lawsuit

An anonymous reader shared this recent report from Bloomberg:

Amazon continued blocking sellers from offering lower prices on rival sites, despite assuring antitrust enforcers it ended its policy that artificially inflated prices for consumers, according to newly unsealed filings in California's antitrust lawsuit against the e-commerce giant.

The Seattle-based company planned to expand penalties on sellers who presented lower prices outside Amazon, even after it claimed in 2019 that it stopped punishing third-party merchants who posted better deals on Walmart, Target, eBay, and, in some instances, their own websites, according to previously redacted portions of the suit that were made public.

The newly unsealed filings include an internal document in which Amazon states point-blank that despite "the recent removal of the price parity clause in our Business Solutions Agreement... our expectations and policies have not changed."

"Many of the complaint's allegations are inaccurate," an Amazon spokesperson told Bloomberg. "We look forward to presenting the facts to the court."

California Attorney General Rob Bonta is seeking a court order blocking Amazon from continuing to engage in what he alleged is anticompetitive behavior, as well as compensation for consumers in the most populous U.S. state. A similar suit filed by Washington, D.C., was dismissed in 2021...

The 2022 suit came three years after Bloomberg reported that the company's policies were forcing sellers to charge more on competing sites like Walmart because Amazon would bury their products in search results if they offered lower prices elsewhere...

California's probe into Amazon's practices also highlighted concerns that ads on the platform are unhelpful for customers.

Amazon advertising revenue grew 19% in the fourth quarter, to $11.6 billion. The fast-growing revenue source helps prop up Amazon's otherwise low-margin online retail business that carries the high expense of operating warehouses around the country and delivering orders to shoppers' homes.

California's attorney general issued an official statement arguing that Amazon "has orchestrated the substantial market power it now enjoys through agreements at the retail and wholesale level that prevent effective price competition in the online retail marketplace." And it includes this fierce denunciation attributed directly to attorney general Bonta:

"As California families struggle to make ends meet, we're in court to stop Amazon from engaging in anticompetitive practices that keep prices artificially high and stifle competition. There is no shortage of evidence showing that the 'Everything store' is costing consumers more for just about everything. Amazon coerces merchants into agreements that keep prices artificially high, knowing full well that they can't afford to say no. With other e-commerce platforms unable to compete on price, consumers turn to Amazon as a one-stop shop for all their purchases. This perpetuates Amazon's market dominance, allowing the company to make increasingly untenable demands on its merchants and costing consumers more at checkout across California. We won't stand by while Amazon uses coercive contracting practices to dominate the market at the expense of California consumers, small business owners, and the economy."