1 year ago
The U.S. government is launching its most consequential attack on the dominance of Big Tech in Americans’ daily lives: a sweeping antitrust lawsuit targeting retail giant Amazon Inc.
The legal challenge, filed in a federal court in Washington state, will be a defining cornerstone of the Biden administration’s pledge to curb the power of the nation’s largest tech companies, including Google, Facebook and Apple, which have been accused of running modern monopolies that don’t fit within the confines of antiquated antitrust laws.
Wednesday’s lawsuit filed by the Federal Trade Commission is the most ambitious gambit yet to rein in the power of large tech companies and is being spearheaded by Lina Khan, who has specifically called for breaking up Amazon in the past. If successful, it could lead to a court-ordered restructuring of the $1.3 trillion empire.
The case challenges a host of Amazon’s business practices, including rules that the FTC says block lower prices on competing websites and policies the FTC believes force merchants to use Amazon’s logistics and advertising services.
The FTC first began investigating Amazon in 2019 during the Trump administration. The probe accelerated once Khan took over the agency, and the FTC has been drafting a complaint since late last year, POLITICO previously reported.
An Amazon spokesperson did not immediately respond for comment.
Khan rose to prominence with a 2017 academic paper specifically identifying Amazon as a modern monopolist needing to be reined in. Because any case will likely take years to wind through the courts, the final result will rest with her successors.
It is the fourth case against Amazon from the FTC since Khan started in 2021. The company settled a pair of privacy cases over its Ring camera and Echo smart speaker businesses for $30 million earlier this year. A third case, alleging the company makes it unnecessarily difficult to cancel Prime subscriptions, is in litigation. Those investigations started prior to Khan’s tenure.
Top enforcement officials in the Biden administration have aggressively gone after corporate mergers in the past year, but more often than not have struck out. The FTC lost its bid to block Microsoft’s $69 billion purchase of Activision earlier this year, which came months after another loss in its case to block Meta’s acquisition of a popular virtual reality app. The agency is appealing the Microsoft loss. The spate of high-profile losses has amped up pressure on the FTC to bring a successful case against Amazon.
The Justice Department meanwhile has two separate lawsuits against Google over its search and advertising businesses, the former of which is in the middle of a 10-week trial. It has pending investigations into Apple, Ticketmaster and Visa, among others.
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