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California sued Amazon on Wednesday, accusing the company of pushing sellers and suppliers into anticompetitive deals that lead to higher prices, including at rival online stores.

The lawsuit, filed by state Attorney General Rob Bonta, focuses on the way Amazon — the largest online retailer — deals with third-party merchants, who account for most of the sales on the platform.

California alleges that Amazon penalizes sellers and suppliers that offer cheaper prices elsewhere on the internet, including Walmart and Target, for example by displaying their items lower or less prominently or outright blocking their new postings.

"Amazon makes consumers think they are getting the lowest prices possible," the lawsuit alleges, "when in fact, they cannot get the low prices that would prevail in a freely competitive market because Amazon has coerced and induced its third-party sellers and wholesale suppliers to enter into anticompetitive agreements on price."

California's antitrust lawsuit is among the biggest legal challenges to Amazon in recent years, as lawmakers and regulators in the U.S. and abroad have investigated the retail giant for potential anticompetitive practices.

An Amazon spokesperson denied any antitrust violations, pointed out that a similar case in the District of Columbia was dismissed, and said the California Attorney General has it backwards.

"Sellers set their own prices for the products they offer in our store," the company said in a statement. "Like any store we reserve the right not to highlight offers to customers that are not priced competitively."

California also accuses Amazon of creating a "vicious anticompetitive cycle": Sellers view Amazon as a must; Amazon charges them higher fees to be able to sell on its platform; Sellers, in turn, raise their Amazon prices. And, even though it costs them less to sell on other websites, Amazon's policies push sellers to raise prices on those sites, too.

"Through its illegal actions, the, quote, "everything store" has effectively set a price floor, costing Californians more for just about everything," Bonta said at a press conference on Wednesday.

Earlier this year, a judge dismissed a similar lawsuit that was filed in Washington, D.C., though the city's attorney general has appealed.

In that case, Amazon argued its deals with merchants were meant to prevent shoppers from being overcharged, and punishing Amazon would hurt consumers.

Amazon has separately proposed a settlement with European antitrust regulators, who charged the company with violating competition laws. Their key allegations accused the company of using data it collected from third-party sellers to its own benefit.

https://www.npr.org/2022/09/14/1122995430/california-sues-amazon

Is this a case of good competition, or are other motives at play?

There's likely motives in play, of that I am pretty sure because Amazon is a pretty big deal and I think that there's enough people that Amazon has good terms with that they go towards this case. Good competition is out of the picture, it's unlikely that we are going to see any competition against Amazon, they're essentially a monopoly in e-commerce.

Amazon is so big it can pretty much act like a monopoly. If you want to sell at Amazon, you may have to lower the price or even sell at a loss. Many think that their products being sold at Amazon is a commercial by itself.
So it's a complicated issue and I would not be surprised that everybody who sells at a loss at Amazon, will try to recover that loss somewhere else.
Maybe this is what "California" is implying? I don't know. It will be a very interesting case, however.

California being the home of silicon valley and 5th largest economy in the world. As well as the homes of google, apple, tesla, microsoft and countless other world famous US tech start ups. One might wonder how california came to have leadership which blames amazon for high market prices. Is this the future direction for silicon valley and the united states as a whole?

Amazon has caused thousands of job losses around the world, which is a much larger number than the jobs it created. It may have become easier for small sellers to sell their products through Amazon, but this has created a real jobs crisis after the company itself manufactures many products on its own and controls the entire distribution process.n.

I am not surprised from a state that has abandoned the ideals that made it the state where everyone wanted to emigrate, and has become a state from which people flee:

More and more regulations and taxes, prohibiting and forcing, and now the typical thing was missing, which is to understand the economy backwards from the way it works.

Let them keep it up in California, they are going to do very well.

The problem is that a lot of people migrate to neighboring states such as Arizona, Texas and Nevada as a result of sky high tax rates in California, and these people after coming to NV and AZ vote for the same sort of politicians who push tax rates further up in these states. And in the end, these states will also pursue populist policies and end up similar to California. And I don't have any sympathies for those who reside in CA. They deserve whatever they get, after electing people like Nancy Pelosi, Dianne Feinstein and Kamala Harris.

The problem is not the taxes, it is the high income individuals, there are other states with high taxes and democrats in charge and they do not have this problem. There is a great understanding among the republicans to keep on showing California as a failed state to get votes in other places, but we have seen horrible states managed by republicans and amazing states managed by democrats as well, should we just make deductions based on that?

It's the people that makes a state good or bad, if it's a good person and a republican then they will make it a good state, if it's a good person but a democrat they will make it a good state, look for good people, not policies, republican ideas or democrat ideas, laws of both side, as long as managed by people with good hearts and intentions, could make any state better.

No sympathies here. Companies such as Amazon and Google spend billions of USD every year to manipulate elections in favor of left-wing political parties, and they are now getting sued by the same people whom they helped to elect. I don't understand this logic. How can Amazon influence the prices in other online platforms? I can say with full confidence that the arrival of Amazon helped to lower prices for 99% of the products and to remove the middle-men. I am sure that the current lawsuit was planned by the middle-men who lost their business due to Amazon. 

then you find the very same product or another product with similar characteristics for a cheaper price in another platform then it is natural that you are going to buy the cheaper option

The dream is near the end, California has stopped being the land of the promise and it's starting to turn more and more into a mess of capitalism socialism and even communism with the cheery on top being that they are only taking the worse part from everything.

The whole dream about building a utopia, like the one with green energy that has led California to have both the highest prices and the most black-outs, the ban of gas cars, and then the announcement to not load your electric car as you stress the grid, the taxes that are driving the same companies away to, ironically Texas, idiotic laws to preserve cities like they are museums driving up prices for homes, driving up rents, turning people into homeless and the ending up destroying the same city center you wanted to protect and eradicating every business there because of crime. And god, how many more!!!

What you missing here is this one. People or buyer has a sort of loyal thinking to branding or platform. If they used to get their stuff from a platform, unless it earns their mistrust, they'll keep using it. This is how Amazon has established itself and its position. They got too many customers browsing Amazon that they were confident even with a little bit more expensive price, they can still sell it against the competitors on other platforms. As well as tricks like price floor like this. So yeah, I can understand why some sellers feel frustrated if they made their goods become available on many platforms and earn a blacklist from Amazon if they set their goods price lower on any platforms other than Amazon.

California is the bluest of the blue states and whatever happened there during the last 2-3 decades can be solely attributed to the policies of the Democrat party. Else how can a state which is home to the Silicon Valley can become bankrupt? I am not defending the GOP as well. Pre-Trump era Republican party was like Democrats on steroids. There were countless invasions of third world nations, which resulted in military expenses of trillions of USD. Trump era was an exception, as the tax rates went down, and there were no major military interventions.

Yes... the last point is a valid one and I am not very comfortable with it.

Amazon blacklists sellers if they sell their products at a lower rate in any of the other online platforms. If the California authorities want to eradicate this practice, then I am 100% in support of them. But given the socialist/communist leaning of the current California representatives, I really don't think that their intention is that good.

Here in India, it is an entirely different story. Offline stores (who used to overcharge the customers by up to 2x) are mad that products are being available at very cheap rates in Amazon.