Did you purchase a product online from an online retailer that also sells the same product on Amazon.com? You may have paid more than you would elsewhere due to Amazon's alleged pricing control. Fill out the form to find out your consumer rights to potential compensation »
An independent investigation by Hagens Berman's legal team and expert antitrust attorneys indicates that Amazon.com has violated federal antitrust price-fixing laws, and attorneys allege that consumers everywhere consequently pay artificially increased prices for products purchased via online retailers across the internet. Consumers have now filed a class-action lawsuit against Amazon for allegedly driving up prices for online purchases made from other retailers.
Hagens Berman has also filed a related case representing Amazon customers who have also allegedly suffered from inflated prices due to Amazon’s anticompetitive practices.
AMAZON'S ALLEGED PRESSURE ON RETAILERS
Amazon operates as a seller, and it opens its marketplace to third-party sellers, so that Amazon can offer its customers an integrated retail site that lists its own retail goods alongside of goods listed by third-party merchants. For a fee, Amazon permits third parties to register with Amazon Marketplace to sell products on Amazon.com to use its platform in tandem with Amazon. This arrangement gives sellers access to millions of buyers and buyers access to millions of sellers via Amazon's controlled platform.
As a retailer, Amazon competes not only with major online or mobile app retail rivals like Costco, Wayfair or Home Depot, but also with its own hosted third-party sellers, who are contractually authorized to sell their wares on the Amazon.com platform.
But selling on Amazon comes with certain restrictions. When a seller registers with Amazon Marketplace, it agrees to the terms of the Amazon Services Business Solutions Agreement (BSA) and the policies incorporated in that agreement, which establishes rules for setting prices on Amazon's platform.
FACTS & FIGURES
- Sales via Amazon account for almost half of all U.S. retail e-commerce.
- Amazon's nine largest competitors have only 1.1-6.6% share.
- Amazon sells approximately 12 million products at Amazon.com.
- 80% of Amazon’s third-party sellers also sell their products on other online retail websites that compete with the Amazon.com platform, most commonly on eBay, their own websites, or via Walmart.
- Almost half of Amazon’s third-party sellers, generate 81 to 100% of their revenues from sales on the Amazon.com platform.
- Amazon has allegedly engaged and continues to engage in horizontal price fixing with its two million third-party sellers with respect to items offered for sale on other sites.
ABOUT AMAZON'S "FAIR PRICING" POLICY
Amazon's restrictions on sellers using its platform included restrictions on the price of products offered for sale on the seller's channels, or its affiliates' channels, or physical stores, meaning if a retailer listed an item for sale on Amazon's Marketplace for a certain price, they were barred from changing that price anywhere else, including on their own website, or in their own physical stores. According to the lawsuit, this gives Amazon an unprecedented control over pricing beyond its own platform. We believe this violates antitrust laws and harms consumers by artificially setting prices.
Even though it is under investigation by the FTC, Amazon continues to enforce this policy under its “fair pricing” provision, which severely penalizes sellers who offer lower prices outside the Amazon.com platform. Amazon’s “fair pricing” policy states that “Amazon regularly monitors the prices of items on our marketplaces,” and that if it sees “pricing practices” on the Amazon.com platform “that harm customer trust, Amazon can remove the Buy Box [i.e., the coveted one-click-to-buy button] remove the offer, suspend the ship option" or suspend or terminate selling privileges.
One of the pricing practices Amazon identifies as “harmful” to customer trust is “[s]etting a price on a product or service that is significantly higher than recent prices offered on or off Amazon." Under the “fair pricing” provision, “[a]ny single product or multiple products packages must have a price that is equal to or lower than the price of the same item being sold by the seller on other sites or virtual marketplaces." Plaintiffs say this effectively gives Amazon control over a massive share of retail pricing, through a horizontal price fixing scheme in violation of federal antitrust laws.
YOUR CONSUMER RIGHTS
The lawsuit seeks reimbursement for the allegedly illegal price increases pushed onto consumers. Hagens Berman believes that those who unknowingly paid high prices for online purchases deserve compensation for Amazon's greed and wrongdoing.
We believe millions of consumers overpaid for online purchases at retail websites that compete with Amazon because Amazon prevents its third-party sellers from competing on price outside the Amazon.com platform. According to the lawsuit, even when it costs sellers less, (when the seller sells directly to consumers on its own website or at a lower fee on eBay) sellers are contractually barred or severely penalized from passing on these savings to their customers.
TOP CONSUMER RIGHTS FIRM
Hagens Berman is one of the most successful consumer litigation law firms in the U.S. and has achieved more than $320 billion in settlements for consumers in lawsuits against food corporations, automakers, big banks and others. Hagens Berman has achieved many record-breaking victories in antitrust matters, and your claim will be handled by attorneys experienced in consumer law.
NO COST TO YOU
In no case will any class member ever be asked to pay any out-of-pocket sum. In the event Hagens Berman or any other firm obtains a settlement that provides benefits to class members, the court will decide a reasonable fee to be awarded to the class's legal team.
In dual orders issued by Honorable Richard A. Jones, the court allowed claims against Amazon to continue and appointed Hagens Berman Interim Co-Lead Counsel, jointly leading the case with one other law firm. Judge Jones cited the firms’ work identifying or investigating potential claims, experience in handling class actions and resources available to represent the class, among other skills.
In his order responding to Amazon’s motion to dismiss the case, Judge Jones upheld claims related to Amazon’s monopolization of the market, as well as claims related to its market power and anticompetitive effects.
“Plaintiffs argue, the SAC [Second Amended Complaint] plausibly alleges a ‘naked restriction on price or output, such as an agreement not to compete in terms of price,’ and this is sufficient,” the order reads.
A class certification briefing schedule is due to the court within the next month.
California attorney general, Rob Bonta, has filed a similar case against Amazon, repeating claims brought by Hagens Berman in its most recent antitrust cases against Amazon. In the state AG’s Sept. 14, 2022 filing, Bonta highlights Amazon’s agreements that thwart competition by agreement with its third-party sellers and by agreement with its suppliers. Since March of 2020, Hagens Berman has trailblazed antitrust cases against Amazon related to consumer price-fixing and monopoly claims: De Coster v. Amazon.com, Inc.; Brown v. Amazon.com, Inc; and Frame-Wilson v. Amazon.com, Inc.
Steve Berman, managing partner of Hagens Berman and attorney for consumers in the four class actions related to the AG’s case, said of the new filing, “We are pleased to see California’s attorney general has joined the fight we started in 2020 over Amazon’s unlawful tactics that have greatly harmed consumers. The proposed class actions we filed paved the way for additional antitrust actions against Amazon, and we believe consumers will reap the rewards of this collective action.”
In an order filed Aug. 2, 2022, Hon. Richard A. Jones for the U.S. District Court for the Western District of Washington in Seattle sided with plaintiffs regarding two motions. Judge Jones denied as moot Amazon’s motion to clarify or reconsider portions of the court’s Mar. 11, 2022 order denying in part Amazon’s motion to dismiss, and granted plaintiff’s motion to compel 26(f) conference.
In denying Amazon’s motion, Judge Jones held that direct purchasers (consumers) have antitrust standing to sue Amazon under the Sherman Act. In granting the proposed consumer class’s motion to compel the start of discovery (i.e., gathering evidence), the court ordered Amazon to participate in a discovery conference, following its inaction and refusal to schedule the conference..
Amazon now must participate in a discovery conference within 10 days to “consider the nature and basis of their claims and defenses and possibilities for promptly settling or resolving the case,” make required disclosures, discuss the preservation of discoverable information and “develop a proposed discovery plan” under Rule 26(f).
On Mar. 11, 2022, the court denied Amazon’s motion to dismiss plaintiffs' federal monopoly claims, as well as one of two federal price-fixing claims plaintiffs asserted.
The remaining claims require plaintiffs to prove Amazon's conduct had a significant anticompetitive impact in the relevant market. The court accepted that the U.S. e-commerce market could be a tenable market in which to evaluate the impact of Amazon's conduct, or at a minimum the product categories that Amazon dominates in could be tenable submarkets for purposes of determining Amazon's liability.
The court did dismiss the federal claim that Amazon engaged in a per se price-fixing violation as well as plaintiffs' state law claims, but it allowed plaintiffs 30 days to amend their complaint to address the deficiencies of these claims.
Washington, D.C. attorney general, Karl Racine, today filed a similar case against Amazon, repeating claims brought by Hagens Berman in 2020.
Steve Berman, managing partner of Hagens Berman and attorney for consumers in the class action said of the new filing, “We are pleased to see D.C.’s attorney general has joined the fight we started in April 2020 over Amazon’s unlawful tactics that have greatly harmed consumers. The proposed class action we filed in 2020 has paved the way for additional antitrust actions against Amazon, and we believe consumers will see the benefit of that.”