California's Attorney General Rob Bonta has accused Amazon of leveraging its market power to pressure retailers, including Walmart and Levi Strauss & Co., to increase prices on their own websites to avoid undercutting Amazon's prices, according to a court filing unsealed Monday in an ongoing antitrust lawsuit filed in 2022 in San Francisco Superior Court [1]. The filing alleges that Amazon's practices involve demanding vendors to monitor and raise prices of products on competing websites, threatening penalties such as promotion restrictions or removal of products from Amazon's platform if compliance is not met [1].
A specific example cited in the filing involves Amazon sending Levi Strauss links to khaki pants listed at lower prices on Walmart.com, prompting Levi Strauss to contact Walmart and raise the price back to $29.99 the following day [1]. The alleged price-fixing scheme is said to cover a wide range of goods, including home decor, garden products, and pet care [1].
Attorney General Bonta emphasized that the lawsuit aims to protect Californians from inflated prices, 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” [1]. Bonta is seeking a preliminary injunction to halt Amazon's practices immediately, with a hearing scheduled for July, while the trial is set for next year [1].
Amazon responded by dismissing Bonta's motion as “a transparent attempt to distract from the weakness of its case” and asserted that it is “consistently identified as America’s lowest-priced online retailer” [1]. Walmart declined to comment on the litigation, stating it is not a party to the case, and Levi Strauss did not respond to requests for comment [1]. Bonta noted that while the current focus is on Amazon, his office reserves the right to pursue action against other retailers and vendors in the future [1].
CONCLUSION
California's lawsuit against Amazon alleges significant antitrust violations with potential market-wide implications, particularly for online retail pricing. The case has drawn strong responses from Amazon and is set for further legal proceedings, with a preliminary injunction hearing in July. The outcome could impact pricing strategies and competition among major online retailers.