US cracks down on American Big Tech with antitrust suit against Amazon for hurting consumers

Amazon.com was sued by the attorney general for Washington for allegedly engaging in anticompetitive practices that have raised prices for consumers.

The antitrust lawsuit, the first to target Amazon in the US, opens a new front in the campaign against major US tech companies and is the sixth such case filed in the last year by state and federal officials. Yet even with the prospect of more action on the way against the industry in general and Amazon in particular, the retailer’s shares recovered from a decline Tuesday on the news and rose on the day.

Attorney General Karl Racine filed the Amazon case on his own for the district, rather than teaming with states, which is a common practice for attorneys general. He said he didn’t know whether states would join and hasn’t coordinated with the Federal Trade Commission, which Bloomberg has reported is investigating Amazon to determine whether the e-commerce giant is using its market power to hurt competition. Moreover, investors understand that monopoly cases typically play out for years and can be difficult to win. The Justice Department case against Google isn’t scheduled for trial until 2023.

Racine said in an interview on Bloomberg TV that he talked with other attorneys general after filing the lawsuit and he would welcome states if they want to join.

“This is a DC case that DC lawyers and our counsel worked on for over a year,” he said. “We engaged with Amazon, tried as best we could to establish a cooperative relationship to gather documents and analyse the case. We felt like the case needed to be brought.”

In his complaint, the attorney general said Amazon’s policies governing third-party sellers prohibit them from offering products at lower prices on rival platforms, which has led to artificially high prices for consumers and let the company build monopoly power.