DC Attorney General Hits Amazon with an Antitrust Suit Alleging the Company Did This

Washington, D.C. Attorney General (AG) Karl Racine has filed an antitrust lawsuit against e-commerce giant Amazon on Tuesday.

The AG has accused Amazon of illegally abusing its monopoly power and violating the District of Columbia Antitrust Act.

Amazon is accused of forbidding third-party sellers from offering cheaper rates for their products on competing websites.

The AG also claims that Amazon’s rules increased the price of retail items across the entire online marketplace, ultimately harming both everyday consumers and third-party sellers.

In a series of tweets the AG wrote, “BREAKING: Today my office filed an antitrust lawsuit against Amazon for illegally abusing and maintaining its monopoly power by controlling prices across the online retail market and violating DC law.”

He went on to say, “For years, Amazon has controlled online retail prices through its restrictive contract provisions & policies. Amazon requires third-party sellers to agree that they won’t offer their products anywhere else online – including their own websites – for a lower price than on Amazon.”

“These agreements also impose an artificially high price floor across the online retail marketplace & ensure high fees charged to third-party sellers by Amazon, as much as 40% of the product price, are incorporated into the price on not only Amazon but also on competing platforms,” read another tweet.

“Amazon has used its dominant position in the online retail market to win at all costs. It maximizes its profits at the expense of 3rd party sellers & consumers forced to pay artificially high prices, while harming competition & innovation & illegally tilting the playing field,” Racine wrote.

He continued, “Amazon claimed it removed its price parity restrictions in 2019. But in fact, it quietly replaced the provision w/ an effectively-identical substitute that says third-party sellers can be sanctioned or removed from Amazon if they offer their products for lower prices elsewhere.”

“We filed this antitrust lawsuit to put an end to Amazon’s illegal control of prices across the online retail market. We need a fair online marketplace that expands options available to District residents and promotes competition, innovation, and choice,” he added.

The allegations were filed in the District of Columbia’s Superior Court and claim that Amazon “suppressed competition from other online retail sales platforms, such as eBay, Walmart, and even the TPSs’ own websites.”

The AG has asked the court to prevent Amazon from continuing its alleged anticompetitive contact and is also asking for monetary damages but did not specify the amount. Additionally the AG is asking the court to strip Amazon of any illegally obtained gains.

Disclaimer: We have no position in any of the companies mentioned and have not been compensated for this article.