DOJ Supports DC Attorney General’s Bid to Resurrect Amazon Antitrust Claims

The DC Attorney General’s motion to reconsider a D.C. Superior Court’s dismissal of its antitrust action against Amazon, Inc., has now received the backing of the Department of Justice.  The lawsuit had alleged that Amazon violated the antitrust laws by including provisions in its contracts with third party merchants operating on its platform prohibiting them from offering lower prices elsewhere, including on the merchants’ own websites. The court had granted Amazon’s motion to dismiss at a hearing in March, which the DC Attorney General has moved the court to reconsider.
The DOJ has now filed an eight-page statement of interest in support of the DC Attorney General’s motion. The DOJ argues that the court conflated the separate showings required by Section 1 of the Sherman Act of “concerted action” and conduct which unreasonably restrains trade. The DOJ first explained that the court erred by holding that the DC Attorney General failed to “exclude the possibility of lawful market behavior or parallel conduct.” While a plaintiff alleging a Section 1 antitrust claim must, in the absence of direct evidence of an agreement, allege more than just parallel conduct between two parties, the DOJ encouraged the court to reconsider because the DC Attorney General had alleged direct evidence of an agreement—the challenged Amazon merchant agreements themselves. There should have been no question that the “concerted action” requirement was met. 

Whether the challenged merchant agreements unreasonably restrain trade is a different question entirely from the “concerted action” requirement and must be analyzed under either the per se or rule of reason. But according to the DOJ, the court improperly blended aspects of the “concerted action” inquiry into its analysis of whether the agreements unreasonably restrained trade.  

Specifically, the DOJ took issue with the court’s finding that the agreements were reasonable because they could be explained “unchoreographed behavior.” But whether Amazon and its merchants’ behavior was choreographed, the DOJ argues, has no bearing on whether the challenged restraints are unreasonable. 

DC Attorney General, Karl A. Racine, tweeted his gratitude for the DOJ’s support and said that he was “confident the law and facts are on our side.” 

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About Raymond N. Barto

Raymond N. Barto is a senior associate in Faruqi & Faruqi’s New York office. He focuses his practice on antitrust litigation.

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