DC AG Adds Wholesaler Claim to Amazon Antitrust Suit

Amazon pacts with wholesalers harm consumers by increasing prices and hurting competition on online marketplaces, said District of Columbia Attorney General Karl Racine (D), adding that charge about first-party sellers to his May antitrust lawsuit at D.C. Superior Court (case 2021 CA 001775 B). The original complaint alleged Amazon practiced “anticompetitive restraint” at least until two years ago by barring its third-party sellers through a “price parity provision” in its contracts from offering their products at lower prices on a competing online retail sales platform (see 2105250050). Monday’s amended complaint alleges it's anti-competitive to require first-party sellers to guarantee Amazon a certain minimum profit. That minimum margin agreement means if Amazon lowers its price to match or beat another online marketplace a wholesaler must compensate Amazon for the difference between the minimum and actual profit, said the AG's office: To avoid those payments, wholesalers increase prices on other online marketplaces. “Amazon has continued to use its dominant position as an online marketplace to rig the system,” said Racine. An Amazon spokesperson emailed that what the AG seeks “would result in higher prices to customers, whether offered directly by Amazon or by third parties in our store, oddly going against core objectives of antitrust law." The court plans an initial scheduling conference Oct. 28 at 10:30 a.m.