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Amazon 'strong-armed' Levi's, Hanes to hike prices on rival sites, California AG says

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Why This Matters

This case highlights Amazon's potential role in anti-competitive practices by pressuring brands to inflate prices on rival marketplaces, which could lead to higher costs for consumers and reduced market competition. The allegations underscore ongoing concerns about Amazon's dominance and its impact on fair pricing in the online retail industry.

Key Takeaways

Packages with the logo of Amazon are transported at a packing station of a redistribution center of Amazon in Horn-Bad Meinberg, Germany, on Dec. 9, 2024.

Amazon pressured major brands like Levi Strauss & Co . and Hanes to inflate prices of listings on rival online marketplaces as part of wide-ranging price-fixing scheme, according to California Attorney General Rob Bonta.

The newly unsealed documents released on Monday are part of a 2022 antitrust lawsuit alleging Amazon stifled competition and increased the prices that consumers pay across the internet. The complaint zeroes in on Amazon's agreements with its millions of vendors, which Bonta says "keep prices artificially high" on competing platforms.

Vendors are compelled to agree to Amazon's demands because of its dominant position in online retail, Bonta argued.

Amazon has previously disputed Bonta's claims. An Amazon spokesperson told CNBC in a statement that it will respond in court "at the appropriate time."

"The Attorney General's motion is a transparent attempt to distract from the weakness of its case, coming more than three years after filing its complaint and based on supposedly 'new' evidence it has had for years," the spokesperson said in a statement.

The documents released Monday include 2022 communications between Amazon and undergarments maker Hanes, where it sent the vendor links to listings on Target and Walmart 's websites showing lower prices than those on Amazon.

Hanes confirmed that it "reached out to Target and Walmart to have the prices increased," the filing states.

In another case, Amazon alerted Allergan that it temporarily suppressed listings for its eye drops once it found they were being sold for less elsewhere. The medical products company replied saying, "Walmart got their price back up" to $16.99 and asked Amazon to unsuppress the product. Amazon agreed, according to the filing.