Amazon Offered to Settle California Antitrust Suit in 2022

Leah Nylen, Bloomberg News

The Amazon.com website on a smartphone arranged in New York, US, on Tuesday, Sept. 26, 2023. The US Federal Trade Commission sued Amazon.com Inc. in a long-anticipated antitrust case, accusing the e-commerce giant of monopolizing online marketplace services by degrading quality for shoppers and overcharging sellers. Photographer: Gabby Jones/Bloomberg , Bloomberg

(Bloomberg) -- Amazon.com Inc. offered to settle an antitrust investigation by the California attorney general’s office days before the state filed suit accusing the e-commerce giant over policies that allegedly lead to “artificially high prices” for consumers.

In a Sept. 13, 2022, letter to the office of California’s attorney general viewed by Bloomberg, Bryson Bachman, Amazon’s lead competition lawyer, wrote that the company was willing to change its seller notices and pricing policies to make clear that it doesn’t require price parity with other websites. The state didn’t respond to the offer made in a separate letter on Sept. 8, 2022, Bachman said.

California filed a lawsuit the next day, alleging that Amazon’s merchant agreements bar sellers from offering lower prices on other sites and impose stiff penalties if they do. Amazon offered to make changes to stave off California’s lawsuit, Bonta told Reuters, but said he deemed them unsatisfactory.

Earlier: Amazon Vow to Stop Seller Squeeze Was Fake, California Says

The company has contested the suit, as well as a federal antitrust suit filed last month by the US Federal Trade Commission and 17 other state attorneys general.

The office of California’s attorney general declined to comment on the Amazon letters. The state’s Attorney General Rob Bonta said on Oct. 12 that Amazon hasn’t made overtures to resolve the case since the lawsuit was filed, even though it has settled competition probes in Europe and the UK.

Bonta said Amazon has taken the approach of “fighting it the entire way,” despite California’s attempt to have conversations with senior company attorneys including General Counsel David Zapolsky before the suit was filed.

Amazon said it was “not accurate” that the company hadn’t offered to settle the case with California.

“Amazon proposed multiple settlement offers to the California AG’s office attempting to resolve its concerns in ways that wouldn’t force us to feature higher prices for our customers,” Amazon spokesperson Tim Doyle said. “Although we have not received any counteroffers from the California AG to date, we remain hopeful for constructive dialogue going forward.”

Read more: Amazon Squeezes Sellers That Offer Better Prices on Walmart

The lawsuit was filed three years after Bloomberg News reported that Amazon’s policies were forcing sellers to charge more on competing sites like Walmart because Amazon would bury their products in search results on the popular web store if they offered lower prices elsewhere. A trial is scheduled for 2026.

--With assistance from Spencer Soper.