ABA Calls on State Attorneys General to Open Antitrust Investigation Into Amazon
- By Molly Bond
The American Booksellers Association has sent a letter to the National Association of Attorneys General (NAAG) and to the attorneys general of each state urging them to open an investigation regarding anticompetitive and monopolistic business practices on the part of Amazon.
ABA’s letter comes on the heels of Texas Attorney General Ken Paxton’s announcement that he is leading an investigation involving 50 attorneys general into Google’s possible antitrust violations. Prior to announcing this investigation into Google, Attorney General Paxton joined forces with Iowa Attorney General Tom Miller and 41 other state attorneys general to file a comment with the Federal Trade Commission (FTC) calling for an emphasis on the issue of consumer privacy in antitrust investigations into big tech. The comment notes how “large-scale data collection efforts create network effects and barriers to entry, which can entrench dominant firms.”
Through a press release about the Google investigation, Attorney General Paxton noted, “There is nothing wrong with a business becoming the biggest game in town if it does so through free market competition, but we have seen evidence that Google’s business practices may have undermined consumer choice, stifled innovation, violated users’ privacy, and put Google in control of the flow and dissemination of online information.”
Amazon’s absence from the Texas-led attorneys general investigation prompted ABA to write to NAAG and the state attorneys general asking for an investigation into Amazon’s anticompetitive and monopolistic business practices.
In a comprehensive 22-page letter, ABA makes the case as to why Amazon is a burgeoning monopoly. In the letter, which was originally sent to the FTC and the U.S. Department of Justice before being modified with state-specific information for each attorney general’s office, ABA CEO Oren Teicher stresses the timely importance of opening an investigation into Amazon. The report provides a detailed review of Amazon’s anticompetitive conduct.
Teicher also notes that an apt comparison to Amazon is A&P, which was broken up for antitrust violations in 1949. The similarities between the two retailers (when A&P was at the height of dominance) is striking, he writes. In the 1920s and ’30s, the Great Atlantic and Pacific Tea Company (A&P) changed the way people shopped. And, like Amazon, A&P ultimately used its size in an abusive manner to spur even further growth and dominance.
“The business model of A&P was based on two things: Spreading innovative formats (such as the economy store and then the supermarket), and using threats, bribery, and extortion to destroy competition and control suppliers,” he writes.
In related news, New York Attorney General Letitia James announced on Tuesday that she is leading an antitrust investigation involving 46 other state attorneys general into Facebook’s potential anticompetitive conduct. As reported by the Washington Post, Attorney General Letitia James commented that “Facebook may have put consumer data at risk, reduced the quality of consumers’ choices, and increased the price of advertising.”