California Lawsuit Accuses Amazon of Influencing Competitor Prices
Amazon is under scrutiny as California’s attorney general alleges the company pressured competitors like Walmart to raise prices on their websites, ensuring Amazon’s prices remain competitive. This information was revealed in a court filing made public on Monday.
In 2022, Attorney General Rob Bonta initiated legal proceedings against Amazon in San Francisco Superior Court. The case, which accuses Amazon of breaching California’s antitrust and unfair competition laws, is expected to go to trial next year. However, Bonta is urging the court to demand an immediate halt to Amazon’s practices.
The disclosed filing suggests that Amazon’s purported strategy involves instructing vendors to adjust pricing on competing platforms. Non-compliance could lead to penalties, including restrictions on promotions or product removal from Amazon.
One highlighted instance involves Amazon and the apparel company Levi Strauss & Co., where both reportedly agreed to price adjustments for khaki pants sold on Walmart’s site. Amazon allegedly provided Levi Strauss with links to cheaper pants on Walmart.com, suggesting a swift resolution. Subsequently, Levi Strauss communicated that Walmart had increased the prices to $29.99.
Bonta emphasized the consumer protection aspect, stating, “This is about protecting Californians from paying more than they should for everyday products, especially at a time when affordability feels farther and farther out of reach.”
In response, an Amazon spokesperson criticized Bonta’s motion as an attempt to divert attention from what they claim is a weak case, noting, “Amazon is consistently identified as America’s lowest-priced online retailer, and we’re proud of the low prices customers find when shopping in our store. Amazon looks forward to responding in court at the appropriate time.”
Walmart, while not a party to the lawsuit, expressed its commitment to maintaining low prices for customers in an emailed statement. Levi Strauss has yet to respond to requests for comment.
Bonta indicated that while Amazon is the primary focus due to its initial role in the alleged conduct, other retailers and vendors may also face scrutiny in the future. The allegations cover a broad range of products, including home decor, garden items, and pet care.
A hearing on the motion for a preliminary injunction is set for July.
