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FTC and 22 states sue Amazon over alleged secret ad surcharge scheme

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The Federal Trade Commission and 22 states on Monday sued Amazon over allegations that the e-commerce giant secretly inflated prices in its online search advertising auctions, potentially costing customers tens of billions of dollars.

Key facts

Summary

The lawsuit alleges that the undisclosed surcharges were applied for seven years, increasing the prices that more than 1 million Amazon brands and sellers were required to pay to advertise on its platform. The FTC's lawsuit was joined by the attorneys general of Alaska, Arizona, California, Colorado, Florida, Idaho, Illinois, Indiana, Iowa, Kentucky, Louisiana, Maryland, Nebraska, New Jersey, New York, North Carolina, Oklahoma, Pennsylvania, Rhode Island, South Carolina, Vermont and Washington. The lawsuit centers on so-called second-price auctions, the industry standard for digital ad deals. That raised costs for businesses, alleged the FTC and states joining the suit.

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