The state of California has filed an antitrust lawsuit against Amazon.

The state of California has filed an antitrust lawsuit against Amazon.

The lawsuit echoes a case brought by Karl A. Racine, the attorney general for the District of Columbia, that was thrown out this spring.

Judge Hiram E. Puig-Lugo of the Superior Court of the District of Columbia found Mr. Racine did not provide sufficient evidence Amazon’s policies were anti-competitive.

Mr. Racine is appealing the ruling.

Amazon did not immediately respond to a request for comment on the suit. In the past, it had argued that sellers have control over prices and that including a seller’s offering in the so-called “Buy Box” amounts to an endorsement of a good deal for customers, so it would not feature an offer if it was not priced competitively. It also has argued that online sales are still a small part of the broader retail market.

Most of Amazon’s sales — 57 percent of units last quarter — are of products offered by third-party merchants on Amazon’s website according to The New York Times . They pay Amazon a referral fee to list their products, and often pay for Amazon’s fulfillment services, advertising and other offerings. Amazon collected more than $100 billion in third-party service fees in the last 12 months, according to its financial filings as stated in

Section 4 below..

California has been investigating Amazon for more than two years according to Section 4 , and the complaint, filed in San Francisco Superior Court on Tuesday October 20th 2020 says the practices violated California’s Unfair Competition Law and the Cartwright Act ,the state’s primary antitrust law as stated in Section 5 . It asked for remedies that included ending the anticompetitive behavior and paying penalties with Mr Bonta saying he thought the case would succeed where D.C.(District Of Columbia) has stumbled by providing far more details on how Amazon was hurting consumers with there being more research “than any other case has ever seen,” and because it was brought under California state law which provides stronger protections then Federal ones .The complaint said Amazon was able to charge sellers more than competitors because it captures so much of online sales with rising costs for sellers including fulfillment and paying for advertising ,which sellers increasingly see as a necessity to succeed . The complaint heavily cites internal Amazon documents that are redacted which will be elaborated on further in section 6 .

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Amazon did not immediately respond to a request for comment on the suit.

In the past, it had argued that sellers have control over prices and that including a seller’s offering in the so-called “Buy Box” amounts to an endorsement of a good deal for customers, so it would not feature an offer if it was not priced competitively.

It also has argued that online sales are still a small part of the broader retail market.

Amazon has not yet responded to the lawsuit filed by California. In the past, when faced with similar antitrust lawsuits, Amazon has argued that sellers have control over prices and that inclusion in the "Buy Box" is simply an endorsement of a good deal for customers. They have also stated that online sales are still a small part of the overall retail market.

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Most of Amazon’s sales — 57 percent of units last quarter — are of products offered by third-party merchants on Amazon’s website.

They pay Amazon a referral fee to list their products, and often pay for Amazon’s fulfillment services, advertising and other offerings.

Amazon collected more than $100 billion in third-party service fees in the last 12 months, according to its financial filings.

Third-party sellers are a crucial part of Amazon's business model. They are responsible for 57% of the units sold on the site, and in exchange for being able to sell their products on Amazon, they pay referral fees and often use Amazon's fulfillment services. This arrangement has been extremely lucrative for Amazon; in the last 12 months alone, they collected over $100 billion in third-party service fees.

However, some California lawmakers believe that this arrangement is unfair and anticompetitive. They allege that because Amazon controls such a large portion of online sales, they are able to charge higher prices to third-party sellers. This puts small businesses at a disadvantage and ultimately hurts consumers by driving up prices. The state of California has filed an antitrust lawsuit against Amazon in an attempt to remedy this situation.

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California has been investigating Amazon for more than two years.

The complaint, filed in San Francisco Superior Court, said the practices violated California’s Unfair Competition Law and the Cartwright Act, the state’s primary antitrust law.

It asked for remedies that included ending the anticompetitive behavior and paying penalties.

California has been investigating Amazon for more than two years over its business practices. The state's attorney general, Xavier Becerra, filed a lawsuit against Amazon on Tuesday alleging that the company has engaged in anticompetitive behavior in violation of California law.

The complaint, filed in San Francisco Superior Court, alleges that Amazon has used its dominant position in the online marketplace to stifle competition and harm consumers. Specifically, the complaint alleges that Amazon has engaged in three prohibited practices:

1) requiring sellers to sell their products at prices set by Amazon;

2) giving preferential treatment to sellers who use Amazon's fulfillment services; and

3) using data from third-party sellers to develop and sell competing products.

The complaint asks for remedies that include ending the anticompetitive behavior and paying penalties.

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Mr. Bonta said he thought the case would succeed where D.C. has stumbled by providing far more details on how Amazon was hurting consumers.

He said there was more research “than any other case has ever seen,” and because it was brought under California state law, which provides stronger protections.

The complaint said Amazon was able to charge sellers more than competitors because it captures so much of online sales.

The rising costs for sellers include fulfillment and paying for advertising, which sellers increasingly see as a necessity to succeed.

Subsection 5.4 The complaint heavily cites internal Amazon documents that are redacted.

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The complaint said Amazon was able to charge sellers more than competitors

The complaint said Amazon was able to charge sellers more than competitors because it captures so much of online sales. The rising costs for sellers include fulfillment and paying for advertising, which sellers increasingly see as a necessity to succeed. The complaint heavily cites internal Amazon documents that are redacted.

The complaint alleges that Amazon has used its dominant position in the online marketplace to stifle competition and drive up prices for consumers. By controlling such a large share of online sales, the complaint argues, Amazon has been able to charge sellers more than their competitors, while also requiring them to pay for fulfillment and advertising services. This has put many small businesses at a disadvantage, as they are unable to compete with Amazon's vast resources.

The complaint cites internal Amazon documents that reveal the company's strategy of using its market power to extract higher fees from sellers. In one instance, an Amazon executive is quoted as saying that the company would "force [sellers] to increase their prices" if they wanted to continue doing business on the platform. Another document shows that Amazon considered charging third-party sellers a "success fee" based on their sales volume, but ultimately decided against it due to concerns about antitrust scrutiny.

These documents provide strong evidence that Amazon has been using its dominance in the marketplace to unfairly advantage itself at the expense of consumers and smaller businesses. If these allegations are proven true, it is likely that the company will face significant penalties under antitrust law.

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