The Federal Trade Commission and 17 state attorney generals filed an antitrust lawsuit against Amazon on Tuesday — the latest government attempt at breaking Big Tech’s dominance of the internet.
The lawsuit, which followed a four-year investigation, alleges that the Seattle-based e-commerce behemoth uses its position in the marketplace to inflate prices on other platforms, overcharge sellers and stifle competition, according to the complaint filed in US District Court for the Western District of Washington.
“The FTC and its state partners 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 Amazon,” the agency said in a statement.
FTC chair Lina Khan — the 34-year-old antitrust crusader who wrote a scholarly paper on Amazon’s market dominance while a student at Yale Law School — asked the court to issue a permanent injunction ordering Amazon to stop its unlawful conduct.
Amazon, founded in 1994 and worth more than $1 trillion, pushed back on one of the most significant legal challenges against the company, and follows federal lawsuits filed against Alphabet’s Google and Meta Platforms’ Facebook.
“Today’s suit makes clear the FTC’s focus has radically departed from its mission of protecting consumers and competition,” Amazon said.
“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 company said.
“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.”
Shares of Amazon were down 3% after the FTC announced the legal filing.
The Post has sought comment from Amazon.
“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,” Khan said in a statement.
Many had wondered whether the agency would seek a forced break-up of the retail giant, which is also dominant in cloud computing and has a growing presence in other sectors like groceries and health care.
In a briefing with reporters, Khan dodged questions on whether that will happen.
“At this stage, the focus is more on liability,” she said.
Amazon’s critics welcomed the lawsuit.
“No corporation has ever centralized this much power across so many crucial sectors. Left unchecked, Amazon’s power to dictate and control threatens the rule of law and our ability to maintain open, democratically governed markets,” said Stacy Mitchell of the Institute for Local Self-Reliance which has pushed for the government to act against Amazon.
The need to take action against Big Tech has been one of the few ideas that Democrats and Republicans have agreed on. During the Trump administration which ended in 2021, the Justice Department and FTC opened probes into Google, Facebook, Apple and Amazon.
The Justice Department has sued Google twice – once under Republican Donald Trump regarding its search business and a second time on advertising technology since Democratic President Joe Biden took office. The FTC sued Facebook during the Trump administration and Biden’s FTC has pressed forward with the lawsuit.
With Post Wires
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