Appeals Court Revives D.C.’s Antitrust Lawsuit Against Amazon

A Washington, DC appeals court has reinstated the district’s antitrust lawsuit against Amazon.com Inc., accusing the e-commerce giant of engaging in practices that allegedly suppress competition. According to Yahoo, the District of Columbia Court of Appeals reversed a previous ruling that had dismissed the case, which centers on Amazon’s pricing strategies and their impact on competition.

The lawsuit, originally filed by the D.C. Attorney General’s office in May 2021, alleges that Amazon imposes restrictions on its suppliers and third-party sellers that effectively prevent them from offering lower prices on other platforms. The complaint claims that these practices harm competition by artificially inflating prices and stifling innovation within the online retail sector. Amazon is currently facing a separate but similar legal challenge from the U.S. Federal Trade Commission and over a dozen states, where the company is also seeking dismissal.

Amazon has expressed its disagreement with the appeals court’s decision. Per Yahoo, Tim Doyle, an Amazon spokesperson, stated, “We don’t highlight or promote offers that are not competitively priced,” emphasizing the company’s stance that its policies are designed to benefit consumers. He further noted that Amazon looks forward to defending its practices in court.

Read more: India’s Commerce Minister Criticizes Amazon for Alleged Predatory Pricing

On the other hand, D.C. Attorney General Brian Schwalb welcomed the court’s ruling, seeing it as a victory in the ongoing battle against what he describes as Amazon’s “unfair and unlawful practices.” According to Yahoo, Schwalb stated, “We will continue fighting to stop Amazon’s unfair and unlawful practices that have raised prices for District consumers and stifled innovation and choice across online retail.”

The lawsuit also accuses Amazon of entering into agreements with wholesalers that ensure the company a minimum profit margin. These agreements, as per the complaint, create a scenario where wholesalers are discouraged from lowering prices, as they would be required to compensate Amazon for any loss in profit resulting from price reductions. This, according to the D.C. Attorney General, further contributes to an anti-competitive environment.

The appeals court criticized the initial dismissal of the case by a lower court in May 2023, stating that the judge had set the legal threshold too high for the Attorney General’s office. The court’s ruling affirmed that the district had presented a plausible claim that Amazon’s practices were harmful to competition in the online retail market.

Source: Yahoo