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D.C. attorney general sues Amazon on antitrust grounds

By Don Johnson
D.C. attorney general sues Amazon on antitrust grounds
District of Columbia Attorney General Karl Racine delivers remarks while joining attorneys general during the announcement of a multistate antitrust investigation into Google, outside the Supreme Court in Washington, D.C. on Sept. 23, 2019. File Photo by Michael Reynolds/EPA-EFE.

May 25 (UPI) -- Washington D.C. Attorney General Karl Racine said Tuesday he has filed an antitrust lawsuit against Amazon claiming that its practices have eliminated competition and unfairly raised prices.

Racine, who filed the lawsuit in D. C. Superior Court, said the company fixes prices through agreements with sellers on its website, maintaining its "monopoly power." These agreements create "artificially high" prices by preventing sellers from offering their products at lower prices on websites, including their own e-commerce platforms, Racine said in a statement on his office's Facebook page.

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"Amazon has used its dominant position in the online retail market to win at all costs," Racine said in a statement. "It maximizes its profits at the expense of third-party sellers and consumers, who are forced to pay artificially high prices, while harming competition, stifling innovation, and illegally tilting the playing field in its favor."

Third-party sellers who want to do business on Amazon's website must follow the provisions of its business solutions agreement. Amazon initially had a clause in the document called the "price parity provision," which prohibited sellers from offering their products on a competitors' website at a lower price.

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Amazon removed that provision in March of 2019, but Racine said Tuesday that clause had been replaced with "an effectively-identical substitute."

"We filed this antitrust lawsuit to put an end to Amazon's illegal control of prices across the online retail market. We need a fair online marketplace that expands options available to District residents and promotes competition, innovation, and choice," Racine said in his statement.

Last year, federal and state officials filed antitrust lawsuits against Google and Facebook.

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In December 2020, 37 state attorneys general filed two antitrust lawsuits accusing Google of maintaining its monopoly of search engine and Internet advertising markets through anti-competitive conduct. The Justice Department along with 11 states also sued the tech company in October 2020 for violating the Sherman Act, which bars monopolistic business practices.

The Federal Trade Commission and a group of 48 states and territories filed lawsuits last year accusing Facebook of anticompetitive conduct in its acquisition of Instagram and WhatsApp.

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