California Attorney General Rob Bonta sued Amazon Wednesday, alleging the e-commerce giant has stifled competition in a way that’s increased prices for California consumers.
The lawsuit focuses on the way Amazon — the largest online retailer — deals with third-party merchants, who account for most of the sales on the platform.
“Amazon makes consumers think they are getting the lowest prices possible,” the lawsuit alleges, “when in fact, they cannot get the low prices that would prevail in a freely competitive market because Amazon has coerced and induced its third-party sellers and wholesale suppliers to enter into anticompetitive agreements on price.”
“The intent and effect of these agreements is to insulate Amazon from price competition, entrenching Amazon’s dominance, preventing effective competition, and harming consumers and the California economy.”
Earlier this year, a judge dismissed a similar lawsuit that was filed in Washington, D.C., though the city’s attorney general has appealed.
In that case, Amazon argued its deals with merchants were meant to prevent shoppers from being overcharged, and punishing Amazon would hurt consumers.
Amazon has separately proposed a settlement with European antitrust regulators, who charged the company with violating competition laws. Their key allegations accused the company of using data it collected from third-party sellers to its own benefit.