CA AG Alleges Amazon Forced Price Hikes on Rivals

California Attorney General Rob Bonta alleges that Amazon engaged in an anti-competitive scheme, pressuring major brands like Levi Strauss & Co and Hanes to inflate prices on rival online marketplaces. Newly unsealed documents from a 2022 antitrust lawsuit detail accusations that Amazon used its market dominance to stifle competition and artificially raise consumer prices online.

Core Allegations of Price Fixing

The lawsuit centers on Amazon's alleged agreements with its vast network of vendors. According to Bonta, these agreements compel vendors to maintain higher prices across competing platforms.

• Market Dominance: Bonta argues that vendors feel compelled to comply with Amazon's demands due to the company's dominant position in online retail.
• Evidence from Documents: The recently released 2022 communications between Amazon and Hanes revealed that Amazon sent the undergarments maker links to Target and Walmart listings showing lower prices than those on Amazon.
• Vendor Confirmation: The filing further states that Hanes confirmed it subsequently "reached out to Target and Walmart to have the prices increased."

Previous Instances of Alleged Anti-Competitive Behavior

Beyond pricing, the documents detail other instances where Amazon allegedly interfered with pricing on rival sites:

• Allergan Eye Drops: Amazon reportedly alerted Allergan that it temporarily suppressed listings for the eye drops when it discovered they were being sold for lower prices elsewhere. Allergan responded by noting that Walmart had raised the price to $16.99 and requested Amazon unsuppress the product, which Amazon allegedly agreed to do.

Amazon's Response to the Lawsuit

Amazon has strongly disputed the Attorney General's claims. A company spokesperson issued a statement to CNBC, asserting that Amazon would respond in court "at the appropriate time."

• Disputing the Motive: The spokesperson characterized the Attorney General's motion as a "transparent attempt to distract from the weakness of its case," noting that the complaint was filed over three years prior and relied on supposedly old evidence.