Skip to content Skip to footer

FTC and 17 States File Antitrust Lawsuit Against Amazon

“This is one of the most important antitrust cases in U.S. history,” said a supporter of the federal agency’s lawsuit.

Amazon's logo hangs in the entrance area at the online retailer's research and development site during a press event in Saxony, Dresden, on September 14, 2023.

Economic justice advocates applauded on Tuesday as the Federal Trade Commission and 17 states filed a sweeping antitrust lawsuit against Seattle-based Amazon.com for illegally dominating the online retail economy at the expense of consumers.

“Freedom of commerce is a fundamental liberty of American democracy,” declared Open Markets Institute executive director Barry Lynn in response to the suit. “Today the FTC took a first step to restoring the liberty of every individual and business who relies on essential internet platforms to exchange goods, services, and ideas with one another.”

Lynn praised the commission for “targeting some of the most egregious abuses by Amazon of the dominant position it has acquired over vast swaths of online commerce, and the corporation’s routinized manipulation of other people’s business for its own private purposes.”

The 172-page complaint “lays out how Amazon has used a set of punitive and coercive tactics to unlawfully maintain its monopolies,” said FTC Chair Lina Khan in a statement. “The complaint sets forth detailed allegations noting how Amazon is now exploiting its monopoly power to enrich itself while raising prices and degrading service for the tens of millions of American families who shop on its platform and the hundreds of thousands of businesses that rely on Amazon to reach them.”

The document — filed in a federal court in Washington state — alleges that Amazon maintains “durable monopoly power” in the online superstore and marketplace services markets, including by stifling price competition and coercing sellers into using its fulfillment service. The section on its algorithmic tool “Project Nessie” is heavily redacted.

“Seldom in the history of U.S. antitrust law has one case had the potential to do so much good for so many people,” noted John Newman, deputy director of the FTC’s Bureau of Competition. States led by both Democrats and Republicans — Connecticut, Delaware, Maine, Maryland, Massachusetts, Michigan, Minnesota, New Jersey, New Hampshire, New Mexico, Nevada, New York, Oklahoma, Oregon, Pennsylvania, Rhode Island, and Wisconsin — joined the highly anticipated lawsuit.

Amazon — which was founded by Jeff Bezos, one of the richest people on the planet, and is now the second-largest private employer in the United States — swiftly pushed back on Tuesday.

David Zapolsky, the company’s senior vice president of global public policy and general counsel, claimed the FTC case “is wrong on the facts and the law.” He said the challenged practices “have helped to spur competition and innovation across the retail industry, and have produced greater selection, lower prices, and faster delivery speeds for Amazon customers and greater opportunity for the many businesses that sell in Amazon’s store.”

Meanwhile, critics of the company joined Open Markets in celebrating the development — echoing praise for FTC in June, when the commission sued Amazon over its “yearslong effort to enroll consumers into its Prime program without their consent while knowingly making it difficult for consumers to cancel their subscriptions.”

Matt Stoller, director of research at the American Economic Liberties Project, said Tuesday that “the FTC is right to challenge Amazon, a company that appears to offer low prices under the guise of free shipping but in fact inflates prices across the whole economy.”

“In order to reach most online customers, sellers must sell through Amazon. This market power enables Amazon to set the price floor on almost every online retail item offered by sellers, extract a 50% cut from each sale, and punish sellers who try to sell elsewhere at lower prices,” he explained. “At the same time, it leverages its dominance to block rivals from entering the markets in which it offers services, while its own marketplace is increasingly saturated with pay-to-play junk ads.”

“There’s no such thing as ‘free shipping’ just as there’s no such thing as a free lunch, Amazon is just hiding from consumers how much they have to pay,” Stoller stressed. “Amazon is a monopoly, and we’re thrilled to see the FTC end its coercive tactics.”

Stacy Mitchell, co-director at the Institute for Local Self-Reliance — which has spent over a decade sounding the alarm about the retail giant’s practices — charged that “for too long Amazon has been allowed to maintain a stranglehold on the online market.”

“The filing of this lawsuit is a victory for freedom and self-governance; it marks a crucial rekindling of public authority to check unaccountable private power,” said Mitchell. “This is one of the most important antitrust cases in U.S. history.”

“Breaking up Amazon is key to repairing the online market and opening the way for competition,” she argued. “As this lawsuit shows, Amazon’s anti-competitive tactics largely hinge on leveraging the interplay between its retail division, third-party marketplace, and logistics operation. Separating them would eliminate Amazon’s ability to monopolize the market. We are encouraged that both the scope of this case and the FTC’s request for the court to consider structural remedies show that the agency intends to tackle Amazon’s monopoly power at its root.”

Demand Progress communications director Maria Langholz called the case “long overdue,” given the company’s record of “shamelessly engaging in exclusionary and unfair tactics to trap third-party sellers in its own marketplaces, gouge them with predatory fees, and punish them for trying to offer lower prices to consumers.”

“This marks a historic step in challenging Amazon’s abuse of its market dominance and its anti-consumer, anti-worker, anti-small business practices,” Langholz said. Like Mitchell, she also suggested that the suit should be “a catalyst for a broader conversation about the need to break up Amazon as the best and most effective remedy.”

Help us Prepare for Trump’s Day One

Trump is busy getting ready for Day One of his presidency – but so is Truthout.

Trump has made it no secret that he is planning a demolition-style attack on both specific communities and democracy as a whole, beginning on his first day in office. With over 25 executive orders and directives queued up for January 20, he’s promised to “launch the largest deportation program in American history,” roll back anti-discrimination protections for transgender students, and implement a “drill, drill, drill” approach to ramp up oil and gas extraction.

Organizations like Truthout are also being threatened by legislation like HR 9495, the “nonprofit killer bill” that would allow the Treasury Secretary to declare any nonprofit a “terrorist-supporting organization” and strip its tax-exempt status without due process. Progressive media like Truthout that has courageously focused on reporting on Israel’s genocide in Gaza are in the bill’s crosshairs.

As journalists, we have a responsibility to look at hard realities and communicate them to you. We hope that you, like us, can use this information to prepare for what’s to come.

And if you feel uncertain about what to do in the face of a second Trump administration, we invite you to be an indispensable part of Truthout’s preparations.

In addition to covering the widespread onslaught of draconian policy, we’re shoring up our resources for what might come next for progressive media: bad-faith lawsuits from far-right ghouls, legislation that seeks to strip us of our ability to receive tax-deductible donations, and further throttling of our reach on social media platforms owned by Trump’s sycophants.

We’re preparing right now for Trump’s Day One: building a brave coalition of movement media; reaching out to the activists, academics, and thinkers we trust to shine a light on the inner workings of authoritarianism; and planning to use journalism as a tool to equip movements to protect the people, lands, and principles most vulnerable to Trump’s destruction.

We urgently need your help to prepare. As you know, our December fundraiser is our most important of the year and will determine the scale of work we’ll be able to do in 2025. We’ve set two goals: to raise $81,000 in one-time donations and to add 1250 new monthly donors by midnight on December 31.

Today, we’re asking all of our readers to start a monthly donation or make a one-time donation – as a commitment to stand with us on day one of Trump’s presidency, and every day after that, as we produce journalism that combats authoritarianism, censorship, injustice, and misinformation. You’re an essential part of our future – please join the movement by making a tax-deductible donation today.

If you have the means to make a substantial gift, please dig deep during this critical time!

With gratitude and resolve,

Maya, Negin, Saima, and Ziggy