GoKawiilFTC and 22 states sue Amazon over hidden ad-auction price hikes worth $20 billion
The FTC and attorneys general from 22 states filed suit against Amazon, alleging the company secretly altered its ad-auction pricing after bids closed, extracting over $20 billion in extra charges from roughly 1.2 million advertisers since 2018. The complaint centers on a 'soft reserve' mechanism that reportedly raised final prices on Sponsored Products, Sponsored Brands, and Sponsored Display placements beyond the standard second-price model, with heavier markups during peak shopping periods like the holidays. Amazon has rejected the allegations, saying the government misunderstands how advertisers set bidding strategy.