Amazon Sued by FTC and States Over Misleading Ad Auctions
The Federal Trade Commission (FTC) and 22 states have filed a lawsuit against Amazon, alleging that the company defrauded advertisers by overcharging them through misleading online ad auctions.
The lawsuit claims that Amazon offered competitive prices on ad products while secretly raising auction prices, resulting in tens of billions of dollars in revenue for the company between 2021 and 2025.
According to the complaint, this practice allows Amazon to extract additional revenue from sellers on its platform, cutting into their profit margins and leading to price increases for customers.
In response, Amazon stated that the FTC's claim 'fundamentally misunderstands how advertisers operate,' and that they saved over $8 billion as a result of prioritizing ad relevancy over selecting ads based on bid price alone.