DC AG expands Amazon lawsuit to include wholesaler pricing tactics

Washington, DC Attorney General Karl Racine has filed an amended antitrust lawsuit against Amazon. He accused Amazon of strong-arming wholesalers that provide it with products into anti-competitive agreements and making them subsidize lower prices. Engadget has contacted Amazon for comment.

"We knew Amazon was anti-competitive, but through our investigation, were realizing just how far it goes," Racine wrote on Twitter.

The AG contends that Amazon requires a guarantee from wholesalers that it will make a minimum profit when it resells their products. Those deals enable Amazon to undercut competitors' pricing and force wholesalers to pay the difference for lost profit margins, according to court documents obtained by The Washington Post.

Racine claims that prompts wholesalers to charge more for goods elsewhere to offset those payments, making it more difficult for other e-commerce platforms to compete against Amazon's prices. PopSockets CEO David Barnett previously testified that Amazon demanded payment from the company to make up for lost profits after it reduced prices.

In the initial version of the suit, which was filed in May, Racine claimed Amazon blocks third-party sellers from offering their wares at lower prices on other platforms. Amazon is facing antitrust scrutiny elsewhere, including from the House of Representatives, the Federal Trade Commission and the European Commission. Several state attorneys general are also said to be looking into whether the company has broken antitrust laws.