Amazon allegedly worked through vendors to raise prices on products at competing retailers, including Walmart and Target, according to a newly unredacted court filing from California on Monday.
The unredacted evidence, largely based on email communications, includes instances of raising prices with vendor brands such as Levi’s, Hanes, Newell Brands and more.
California Attorney General Rob Bonta on Monday debuted the public release of evidence in a lawsuit the state has against the e-commerce giant. The lawsuit was first filed in 2022 and claims Amazon stifled competition, which led to increased prices across the state.
The filing outlines several instances that detail how Amazon allegedly monitors competitors’ pricing, using vendors as middlemen to raise prices elsewhere and then price match the newly heightened rate.
In some cases, listings were allegedly suppressed on Amazon, buy boxes were ceded, and vendors removed inventory at competitors until the heightened rates Amazon sought were achieved.
In one alleged instance, Amazon sent Levi’s links to two “styles of concern" due to lower prices on Walmart's website, noting it hoped these can “get resolved” within a few days. Levi’s responded, saying it spoke to Walmart and “they have partnered with us to” raise the price on a khaki style immediately, providing links to the now increased Walmart price.
“Walmart partnered with [us] to update this as a test for the best interest of the marketplace,” Levi’s reiterated to Amazon, according to the filing.
Amazon allegedly also sent Hanes links to Target and Walmart’s websites, showing lower prices than what was on Amazon. Hanes responded, saying it “reached out to Target and Walmart to have the prices increased.”
Additionally, Amazon allegedly asked home furnishings and decor vendor Linon if there was anything it could do to ensure a price drop at competitors was resolved permanently and wouldn’t happen again. In response, Linon agreed to remove inventory from the competitor.
Newell Brands — owner of Rubbermaid and Paper Mate — alerted Amazon that a label maker it produces was at risk of “being shut off for Amazon as it’s causing high disruption.” Amazon responded by agreeing to “temporarily cede the buy box” to “give time for Walmart and Target to raise their prices, which we would then match.”
In another instance, Amazon allegedly told a vendor, Armen Living, that it would “remove all four of [the products] from [Amazon’s] website in the next few days” if a pricing issue wasn’t resolved, which would have been just before the Black Friday and Cyber Monday shopping events.
Attorney General Bonta filed a request for a preliminary injunction in February, asking the San Francisco Superior Court to halt some of Amazon’s conduct while the lawsuit proceeds.
In response to Retail Dive’s request for comment, Amazon said Bonta’s motion had a weak case and that the company is “consistently identified as America’s lowest-priced online retailer.”
Amazon did not immediately respond to Retail Dive’s follow-up question asking if it is standard practice for the company to ask vendors to work on raising prices at competitor sites.
The unredacted filing also alleges that Amazon trains employees to obscure written evidence of price-fixing efforts. An Amazon price training tells employees to “not use email” if “you need to refer to specific example, when negotiating incremental price match funding, or to highlight activities in the channel,” per the filing.
“The fact that so many major retailers were implicated in this scheme should give every participant in this economy pause,” Lee Hepner, senior legal counsel for the American Economic Liberties Project, told Retail Dive. “We tend to talk about Amazon as having an adverse effect on thousands of smaller third-party sellers on the platform, but when you see that Amazon's conduct is coercing very large retailers, including Levi's and Hanes, that is a new dimension to the scale of Amazon's harm.”
Target and Levi’s did not respond to requests for comment from Retail Dive.
Walmart told Retail Dive it does not “comment on litigation in which we are not a party,” adding that it “will always work hard on behalf of our customers to keep our prices low.”
The hearing on the preliminary injunction motion is set for July 23, and the case is scheduled to go to trial in January.
