Amazon Defeats Consumer Antitrust Lawsuit Over Fulfillment Centers

Amazon.com Inc on Thursday defeated a private lawsuit in Seattle federal court that accused the national retailer of a scheme to curb competition for shipping and fulfillment services, causing consumers to pay more for purchases in violation of U.S. antitrust law.

U.S. District Judge Ricardo Martinez in his ruling said the consumer plaintiffs had not shown why they should be allowed to sue over logistics practices -- how and when a purchased item shows up at the buyer's residence.

The prospective class action complaint, filed in 2021 by two members of the annual paid subscription service Amazon Prime, alleged Amazon was unlawfully "tying" the online sale of third-party products to the use of the company's "Fulfillment by Amazon" program.

The lawsuit said Amazon's alleged anticompetitive fulfillment practices had harmed "hundreds of millions of its loyal customers." The plaintiffs sought unspecified monetary damages and an "injunction to prohibit Amazon from continuing its unlawful conduct."

A spokesperson for Amazon declined to comment.

Lawyers for the plaintiffs did not immediately respond to a message seeking comment.

Amazon's attorneys argued that fulfillment services are sold not to consumers who buy products but to third-party businesses that are selling goods on the company's platform. In a court filing, Amazon said the plaintiff's complaint "suffers from myriad fatal legal defects."

The judge's ruling said the plaintiffs were not buyers of logistic services, the "allegedly monopolized product" at issue in the lawsuit, and that plaintiffs "at best are indirect purchasers precluded from bringing antitrust claims." The order gave the plaintiffs a chance to file an amended complaint.

The antitrust case against Amazon was among private and state actions alleging violations of competition law. Amazon has denied claims in those other cases, including that the company's policies unlawfully bar merchants from offering better prices elsewhere.

The case is Angela Hogan et al v. Amazon.com Inc, U.S. District Court, Western District of Washington, No. No. 2:21-cv-996-RSM.

For Hogan: Beth Terrell of Terrell Marshall Law Group; Kenneth Wexler of Wexler Boley & Elgersma; Daniel Gustafson of Gustafson Gluek; and Brett Cebulash of Taus, Cebulash & Landau

For Amazon: Stephen Rummage of Davis Wright Tremaine and John Schmidtlein of Williams & Connolly