Amazon must face DC antitrust lawsuit, Court of Appeals rules

A Washington, DC appeals court on Thursday revived the district’s lawsuit against Amazon.com Inc, saying it had plausibly argued that the online retailer’s pricing policies illegally stifle competition.

The District of Columbia Court of Appeals reversed a ruling that dismissed the lawsuit, which accused Amazon of harming competition by restricting its suppliers and third-party sellers on Amazon.com.

Amazon is currently seeking dismissal of another case involving similar claims from the US Federal Trade Commission and more than a dozen states.

Amazon spokesman Tim Doyle said the company disagrees with the appeals court’s decision and looks forward to proving its policies benefit consumers.

“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,” he said.

D.C. Attorney General Brian Schwalb welcomed the court’s decision in a statement.

“We will continue to fight to stop Amazon’s unfair and illegal practices that have driven up prices for consumers in the District and stifled innovation and choice in online retail,” he said.

DC sued Amazon in May 2021, alleging that Amazon effectively prohibits third-party sellers from offering lower-priced products elsewhere by refusing to highlight their listings if they do.

The lawsuit also alleges that Amazon has agreements with wholesalers that guarantee it a minimum profit. As a result, the complaint alleges that if Amazon lowers a price to compete with another online seller, the wholesaler must pay Amazon the difference between the price it sells at and the agreed upon minimum. Those payments are a disincentive for wholesalers to lower prices to compete, the complaint says.

The D.C. Court of Appeals said Thursday that the judge who dismissed the case in May 2023 set the bar too high, and the attorney general said the practices harmed competition in the online retail market.

TOPICS
Law of processes