Amazon Sued By FTC, 17 States Over Alleged Retail Monopoly

The Federal Trade Commission and 17 states have filed an antitrust lawsuit against Amazon, alleging that the tech retailer has used illegal tactics in pursuit of a retail monopoly.

The commission cited what it called an “ongoing pattern of illegal conduct.” That behavior, it maintains, blocks competitors and allows Amazon to “wield monopoly power to inflate prices, degrade quality, and stifle innovation for consumers and businesses.”

The FTC and the states say Amazon’s actions allow it to stop rivals and sellers from lowering prices, degrade quality for shoppers, overcharge sellers, stifle innovation, and prevent rivals from fairly competing against the tech giant.

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Amazon’s size alone is not the crux of the complaint, the plaintiffs emphasized. Rather, it is “a course of exclusionary conduct that prevents current competitors from growing and new competitors from emerging,” a press release said.

“Our complaint lays out how Amazon has used a set of punitive and coercive tactics to unlawfully maintain its monopolies,” said FTC Chair Lina M. Khan. “The complaint sets forth detailed allegations noting how Amazon is now exploiting its monopoly power to enrich itself while raising prices and degrading service for the tens of millions of American families who shop on its platform and the hundreds of thousands of businesses that rely on Amazon to reach them. Today’s lawsuit seeks to hold Amazon to account for these monopolistic practices and restore the lost promise of free and fair competition.”

Khan’s FTC has aggressively pursued claims against multiple tech companies, contributing to a more restrictive atmosphere of regulation during the Biden Administration. Yet many of her campaigns have not borne fruit, leading to uncertainty about whether Amazon might ultimately be hampered by this latest action. Amazon stock is down nearly 3% today, though the broader stock markets are also in the red.

David Zapolsky, Amazon SVP of Global Public Policy and General Counsel, hit back at the legal action. “Today’s suit makes clear the FTC’s focus has radically departed from its mission of protecting consumers and competition,” he said in a statement provided to Deadline. “The practices the FTC is challenging have helped to spur competition and innovation across the retail industry, and have produced greater selection, lower prices, and faster delivery speeds for Amazon customers and greater opportunity for the many businesses that sell in Amazon’s store. If the FTC gets its way, the result would be fewer products to choose from, higher prices, slower deliveries for consumers, and reduced options for small businesses —the opposite of what antitrust law is designed to do. The lawsuit filed by the FTC today is wrong on the facts and the law, and we look forward to making that case in court.”

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