FTC Prepares “the Big One,” a Major Lawsuit Targeting Amazon's Core Business
Freeman writes:
The Federal Trade Commission is preparing to file a major antitrust lawsuit accusing Amazon of "leverag[ing] its power to reward online merchants that use its logistics services and punish those who don't," Bloomberg reported today. Bloomberg described the forthcoming lawsuit as "the big one," following several earlier lawsuits filed by the FTC under Chair Lina Khan.
"In the coming weeks, the agency plans to file a far-reaching antitrust suit focused on Amazon's core online marketplace, according to documents reviewed by Bloomberg and three people familiar with the case," the report said.
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Third-party sellers can rely on Amazon for warehousing, shipping, and other services through the Fulfillment by Amazon (FBA) system, but it takes a big cut out of their revenue. A recent Marketplace Pulse study based on profit and loss statements from a sample of sellers found that "Amazon is pocketing more than 50 percent of sellers' revenue-up from 40 percent five years ago," because "Amazon has increased fulfillment fees and made spending on advertising unavoidable."
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The FTC's current investigation began two years before Khan became chair. "Amazon received the initial investigation notice in June 2019, according to documents viewed by Bloomberg.
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