A lawsuit against Amazon brought by Washington DC has been revived after an appeals court in the nation's capital overturned an earlier decision to dismiss the lawsuit, which claims Amazon harms competition with its Marketpalce.
The decision comes more than two years after the case was dismissed by the top court. The complaint was originally filed in 2021.
Amazon spokesperson Tim Doyle told Tom's Guide that the company disagrees with the court's decision and looks forward to “presenting facts in court that demonstrate how beneficial these policies are to consumers.”
“Just like any store owner who wouldn’t want to promote a bad deal to their customers, we don’t highlight or promote deals that aren’t competitively priced,” Doyle said.
Current Washington DC Attorney General Brian Schwalb welcomed the court's decision in a statement to Reuters.
We will continue to fight to end Amazon's unfair and illegal practices that have raised prices for District consumers and stifled innovation and choice in online retail.
Attorney General Brian Schwalb
“We will continue to fight to end Amazon’s unfair and illegal practices that have raised prices for District consumers and stifled innovation and choice in online retail,” Schwalb said.
The initial antitrust complaint against Amazon claimed that the consumer giant was stifling competition in its Marketplace, the section of Amazon that allows third-party businesses and individuals to sell products on the platform.
The complaint alleges that Amazon imposes unreasonable requirements on third-party sellers. This includes prohibiting sellers from offering their products at lower prices on marketplaces other than Amazon. Amazon essentially prohibits third-party sellers from offering the same products elsewhere by refusing to feature listings if they do so.
District of Columbia Attorney General Karl Racine then argued in the initial court filing that the requirements resulted in a loss of competition and innovation.
The filing stated: “Amazon’s online retail platform benefits from and is protected by Amazon’s anticompetitive business practices. Far from enabling consumers to get the best products at the lowest prices, Amazon instead artificially increases prices across the entire online retail market, both for products sold on Amazon’s online retail platform and on the online retail platforms of its competitors.”
Racine was seeking structural solutions that would force Amazon to change its rules for third-party sellers, potentially ending the price restrictions.
The District of Columbia Court of Appeals said the Superior Court judge set the bar too high in dismissing the original complaint in 2023 and that the attorney general had a plausible claim.
More lawsuits against Amazon are pending
This isn’t even the only lawsuit Amazon is facing over its Marketplace. The Federal Trade Commission and a dozen states are pursuing a separate antitrust lawsuit, claiming that Amazon is a monopoly that stifles competition through anticompetitive practices. Amazon is currently seeking to have that case dismissed as well. Pending the outcome of that case and the lack of dismissal here, it’s possible that case will also go to court.
Amazon recently lost a lawsuit that found the retailer liable for selling dangerous third-party products and was forced to recall more than 400,000 items.