Amazon tactics inflate prices across internet, emails show

California AG says Amazon used code words to avoid paper trail

The Guardian investigation, drawing on internal Amazon records obtained by California’s attorney general as part of a lawsuit alleging widespread price-fixing, details how Amazon’s market dominance allegedly enabled it to push prices higher across the internet. The lawsuit, originally filed in 2022 and scheduled for trial in early 2027, alleges that Amazon coerced suppliers into raising prices on rival platforms.

In one example cited by the state, an electric ice-cream maker listed at $17.99 at Amazon and Best Buy became unavailable at Best Buy after Amazon temporarily removed the supplier’s inventory from its platform. The supplier, Maxi-Matic, pulled its product from Best Buy, and by the end of the day Amazon restored the listing and increased the price to $59.99.

A leather table lamp sold at Walmart rose from $24.99 to $39 after Amazon reached out to the supplier, All The Rages. An employee of the supplier, Joseph Martin, told Amazon in an email that his company had contacted unnamed retailers “to fix the retail” and had seen increases “for a lot of the items already.” Martin told the Guardian the lamp’s price change “reflected the correction of a pricing error” and said his company believes the attorney general’s claims “are without merit.”

Ryan Turano, chief technology officer of AgroThrive, a fertilizer company, told the Guardian that an Amazon vendor manager would list businesses such as Walmart or Home Depot for him to contact. In one internal email, Turano informed the manager that he had “just got out of a meeting with the Home Depot manager” who had “agreed to raise the prices this time.” Turano said, “We were at their mercy,” adding that the company did not have the resources to push back.

A former Amazon “customer success” manager said that higher-ups instructed employees to have certain conversations with suppliers over the phone to avoid a digital trail. “The only rule was, ‘Do not have this in writing,’” he recalled. An in-house Amazon presentation from 2019 instructs staff to send screenshots of rivals’ product listings to suppliers when making compensation requests but to avoid mentioning the companies’ names. A 2022 presentation reminds staff to “not use email” for certain conversations.

California Attorney General Rob Bonta said in an interview that Amazon’s use of euphemisms would not be an adequate defense. “Whatever euphemism it is, whether it be ‘update pricing’ or ‘resolve an issue’ or ‘address a concern’ in the market, all that means is: ‘Fix prices. Get your lower price up to Amazon’s higher price or suffer the consequences,’ and that’s illegal.”

Amazon denies the claims. The company said it works hard to protect customers from “paying too much” and that the practices California challenges are “common in the retail industry and part of the pro-competitive give-and-take between Amazon and its vendors.” In written responses to the Guardian, Amazon accused the California attorney general of “distorting a handful of emails” out of “nearly one million vendor communications” to “suggest a far-reaching conspiracy among unspecified thousands of vendors and retailers.”

Price-fixing lawsuits against Amazon being pursued by the California attorney general and the Federal Trade Commission are both slated to go to trial in early 2027. The company is also battling similar claims in a private class action lawsuit in federal court in Seattle and a legal action pursued by Washington DC’s attorney general.

The FTC’s lawsuit separately alleges that Amazon developed an algorithm that rapidly copied rivals’ price changes “to the penny.” The algorithm, the FTC alleges, was designed to teach competitors that they could not compete with Amazon by offering lower prices, so they may as well raise prices — increases that Amazon’s algorithm would then follow. Amazon did not directly respond to questions about the algorithm but pointed to academic literature noting how common it is for retailers to track prices.

The company has said in legal pleadings that the incidents cited in the California case are “alleged to have occurred many years in the past” and involve “employees who lack pricing authority” and “a microscopic portion of Amazon’s catalog of millions of products.”