Amazon engaged in price fixing by pressing major brands like Levi’s and Hanes to push competing retailers to increase their pricing, according to a newly unsealed filing in California’s antitrust case against the company. The motion, lodged by California Attorney General Rob Bonta in February, adds specificity to the state’s ongoing lawsuit, which alleges that Amazon suppressed price competition across the online retail market. The filings tie that theory to a series of product-level exchanges in which lower prices on competing sites are followed by vendor intervention and, ultimately, higher pricing across channels.
The Background in Brief: California filed an antitrust suit against Amazon in San Francisco Superior Court in 2022, alleging that the company’s marketplace policies suppressed price competition by penalizing sellers that offered lower prices on competing platforms, including Walmart and Target. In February, the state filed a request for a preliminary injunction in a bid to halt Amazon’s conduct while the lawsuit proceeds.
What the Record Shows
On Monday, California Attorney General Rob Bonta announced the public release of evidence that he says “clearly show[s] Amazon’s illegal price fixing scheme that is artificially driving up prices for Americans.” At the center of the release is a newly unsealed motion for a preliminary injunction and accompanying memo of points and authorities in support.
The filing centers, in part, on an exchange involving Levi’s and Walmart: Amazon sent Levi’s links to khaki pants priced lower on Walmart.com (between $25.47 and $26.99), noting that it “hop[ed] these can get resolved over the next few days.” The next day, Levi’s reported that “I talked to Walmart and they have partnered with us to … take Easy Khaki Classic fit back up to … $29.99 immediately,” providing links to reflect the updated pricing. Amazon acknowledged the increase and confirmed it had matched the higher price, stating that “the updated pricing of $29.99 is now showing up on [Amazon].”
That exchange appears alongside others spanning apparel, pet products, and home goods, all following a similar sequence: A lower price appears on a competing retailer’s site, Amazon raises the issue with the vendor, the vendor engages with the competing retailer, and pricing increases or the lower-priced listing disappears.
The mechanisms vary, according to California’s filing. In some instances, competing retailers raise prices at the vendor’s urging, allowing Amazon to match upward. In others, vendors remove products from lower-priced platforms altogether, eliminating the competing price point. In either case, the lower price does not persist in the market.
How the System Operates
“Managing channels” – a term Amazon uses to refer to controlling pricing across competing retailers – sits at the center of the sequence, in which Amazon flags lower prices to vendors, who then move to raise prices or remove products from those retailers, according to the filing. Vendors are instructed to “fix,” “correct,” or “increase” prices across those channels, with Amazon’s directives backed by consequences tied to its internal economics. When Amazon matches a lower price elsewhere, it may seek compensation; when discrepancies persist, products can be suppressed, deprioritized, or removed from sale altogether.
That dynamic reflects Amazon’s position in the retail ecosystem. For many brands, the platform accounts for a meaningful share of online sales, creating a level of dependence that shapes how pricing disputes are resolved across retail channels. As one vendor put it in the record, “We have nowhere else to go and Amazon knows it,” underscoring the extent to which vendors prioritize Amazon’s demands when addressing pricing discrepancies elsewhere in the market.
California’s requested injunction targets that dynamic directly. The state is asking the court to bar Amazon from entering into agreements with vendors or competing retailers to set or stabilize retail prices, and from using vendors as intermediaries to coordinate price increases or break price matches with competing retailers. It further seeks to prohibit Amazon from pressing vendors to raise prices or remove products on rival platforms, as well as from communicating with vendors about competitors’ pricing, promotions, or product availability.
The proposed relief also includes restrictions on payments tied to price matching and the appointment of a monitor to oversee compliance.
THE BOTTOM LINE: The case now turns on whether Amazon’s use of vendors to influence pricing across competing retailers amounts to unlawful coordination. More broadly, it raises questions about how pricing is set across competing retail channels.
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