Washington, D.C. Attorney General Karl Racine on Tuesday filed an antitrust lawsuit against Amazon, alleging the e-commerce giant's anticompetiti

D.C. files antitrust lawsuit against Amazon

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2021-05-25 17:30:03

Washington, D.C. Attorney General Karl Racine on Tuesday filed an antitrust lawsuit against Amazon, alleging the e-commerce giant's anticompetitive pricing practices result in higher costs for consumers and less choice in the online retail market.

Why it matters: The lawsuit concerns how Amazon negotiates with more than 2 million third-party sellers on the platform, which are crucial to the company's business and end up absorbing fees that Amazon charges to list their merchandise.

Details: The lawsuit alleges that provisions known as "most favored nation" agreements bar third-party sellers from offering their merchandise on other platforms for lower prices, including the third-parties' own websites.

Flashback: In 2019, Amazon said it would end the "most favored nation" pricing provisions after criticism from Democratic Sens. Richard Blumenthal and Elizabeth Warren, who was then a presidential candidate.

Between the lines: Racine's name has been in the mix as a contender for the Biden administration's pick to be chairman of the Federal Trade Commission. Suing Amazon — without other state or federal partners — could be an attempt to show his anti-monopolist chops.

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