California is suing Amazon, alleging it participates in an illegal price fixing scheme that is artificially driving up prices for Americans.
In February, Attorney General Rob Bonta filed a request for a preliminary injunction asking the court to halt Amazon’s illegal conduct while California’s lawsuit proceeds
Bonta received a largely unredacted copy of the filing that was released to the public. It paints a clear and shocking picture, he said, of specific interactions in which Amazon, vendors, and competing retailers such as Target, Walmart, Chewy, Best Buy, Home Depot, and others agree to increase retail prices across their platforms.
“The evidence we’ve uncovered is clear as day: Amazon is working to make your life more unaffordable,” Bonta said in a statement. “The company is price fixing, colluding with vendors and other retailers to raise costs for Americans beyond what the market requires – beyond what is fair.”
He said amid a crisis of affordability, Amazon is illegally working to rake in profits by making sure consumers have nowhere else to turn to for lower prices.
The charges
Bonta said Amazon has reached out to its vendors and instructed them to increase retail prices on competitors’ websites, threatening dire consequences if vendors don’t comply. Vendors, bullied by Amazon’s overwhelming bargaining leverage and fearing punishment, agree to raise prices on competitors’ websites, or to remove products from competing websites.
How prices are raised
Amazon uses three different illegal schemes, he said:
- Amazon or its competitor, through their common vendor, will agree to increase the retail price or make a product temporarily unavailable, so that the other retailer can match the increased market price, increasing the price for consumers.
- A competitor offering a cheaper price on a product will increase its retail price at Amazon’s request, a request made through the vendor, so that Amazon can then match that increased retail price, thereby increasing the price for consumers.
- The vendor removes a product from a competing retailer that’s offering a lower price than Amazon, so that the lower price is no longer available in the market and Amazon then raises its retail price, resulting in a higher price for consumers.
Examples of Amazon’s schemes
Highlights from the newly revealed portions of the preliminary injunction include the following:
- Amazon, Levi’s, and Walmart agreed on increased retail pricing for Khaki Pants: Amazon sent Levi’s links to Khaki pants that were priced lower on Walmart.com [$25.47 to $26.99], saying it “hop[ed] these can get resolved over the next few days.” The next day, Levi’s reported that “I talked to Walmart and they have partnered with us to … take Easy Khaki Classic fit back up to…$29.99 immediately” and provided links to show the increased Walmart price. Amazon acknowledged that Walmart raised its price and confirmed it had matched that higher price: “the updated pricing of $29.99 is now showing up on [Amazon].”
- Amazon, Hanes, and Target worked to raise the price of apparel: Amazon sent Hanes links to Target.com and Walmart.com showing lower prices than were on Amazon, and Hanes confirmed that it “reached out to Target and Walmart to have the prices increased.”
- Amazon, Agrothrive, and Home Depot worked to raise the price of plant fertilizer: Amazon complained to vendor Agrothrive about lower prices for Agrothrive’s products at Home Depot, to which Agrothrive responded: “Yes, just got out of a meeting with the Home Depot manager and she has agreed to raise the prices this time.”
Bonta said these interactions are examples countless ones – spanning years and product lines – in which Amazon, vendors, and Amazon’s competitors agree to increase and fix the prices of products on other retail websites.
Next steps
The hearing on the preliminary injunction motion, filed in February, is set for July 23. The case is scheduled to go to trial in January 2027.
