AMZN Being Sued by DC Attorney General

[Gumby]

Yes. You have to be careful. Generalizing without data I don't think that there is a lot of that when Amazon is the seller but I have seen some real ripoffs offered by third parties.

Yes, but my recollection is that there was a court case (last 10-20 years?) that made minimum pricing legal. Google Fu just now gives me this: https://www.reinhartlaw.com/knowled...urns-century-old-rule-setting-minimum-prices/

As I mentioned earlier, the Leegin case merely says that retail price maintenance is no longer per se illegal. Rather, an antitrust action challenging the RPM now must meet the rule of reason test. However, if the plaintiff can show market power, anticompetitive effect and no procompetitive justification, the vertical restraint will violate the antitrust laws. It is indeed a much harder case to make than the prior regime, where all you needed to prove was the existence of the agreement and it was presumed to be anticompetitive.

Simply put, "not per se illegal" does not mean "legal in all circumstances"

 

[jazz4cash]

Yes. You have to be careful. Generalizing without data I don't think that there is a lot of that when Amazon is the seller but I have seen some real ripoffs offered by third parties.

Yes, but my recollection is that there was a court case (last 10-20 years?) that made minimum pricing legal. Google Fu just now gives me this: https://www.reinhartlaw.com/knowled...urns-century-old-rule-setting-minimum-prices/

I think you are lumping what’s legal for a retailer together with what’s legal for a manufacturer. I suspect the key factor is control of distribution so there is some gray area.....and that’s why I’m willing to see what the courts rule. The case you linked contains the following:
“ The Supreme Court recognized that minimum retail pricing, if instigated by retailers, can mask a per se illegal horizontal price fixing scheme.”

 

[Gumby]

One of the problems of applying traditional antitrust analysis to this case is the fact that Amazon is a two-sided market - they sell goods and services to both consumers and to product sellers. Amazon benefits by having the most buyers because that makes it attractive to sellers who want to use its platform to sell. Simultaneously, Amazon benefits by having the most sellers, because that makes it attractive to consumers who just want to shop at one site (and who presumably think they are getting the best prices). How to best maintain and monetize these "network effects" is a major preoccupation for Amazon. The same actions, MFNs or denial of the buy box, may have different competitive effects on each side of the two-sided market. It makes analyzing any case against Amazon very difficult. It also makes prosecuting any case against them very expensive because of all the economic analysis needed.

Here is a law review article that goes deeper into the two-sided market questions, which some may find interesting.

https://ir.lawnet.fordham.edu/cgi/viewcontent.cgi?article=5620&context=flr