‘Amazon rules the world at this point’: Ursula thinks $20B lawsuit may end with a small check

Insight summary

• •Washington state joined the FTC and 21 others in suing Amazon for secretly overcharging advertisers since 2019.
• •The lawsuit alleges Amazon used a covert surcharge called an 'invented auction participant' to inflate ad auction prices.
• •Over 1.2 million advertisers, including 500,000 small and medium businesses, were impacted, potentially generating $20 billion extra revenue for Amazon.
• •Amazon denies wrongdoing and claims its ad system improves relevance.
• •Commentators predict the lawsuit may only result in a small settlement despite the $20 billion claim.
• •The FTC and states seek civil penalties, restitution, and other relief in U.S. District Court in Washington.
• •Amazon previously settled a $2.5 billion FTC case regarding its Prime membership program.