Apple and Amazon hit with price-fixing lawsuit alleging they ‘colluded to raise iPhone, iPad prices’

Chance Miller | Nov 9 2022 - 11:27 am PT

Apple is facing a new antitrust class-action lawsuit, and this time it’s being accused of colluding with Amazon to raise prices. The lawsuit, filed in the US District Court for the Western District of Washington, accuses Apple and Amazon of working together to “stifle competition” by eliminating third-party Apple resellers on Amazon Marketplace.

Apple + Amazon price-fixing lawsuit

The class-action lawsuit is being spearheaded by Hagens Berman, the law firm that has targeted Apple multiple times in the past. Most notably, Hagens Berman successfully went after Apple for e-book pricing fixing in 2013, leading to payouts directly to customers. The firm also represented small developers in a class-action lawsuit against Apple, which led to a $100 million settlement. The lawyers are also fighting an Apple Pay antitrust lawsuit on behalf of banks.

This new class-action antitrust lawsuit targets Apple and Amazon, saying that the two companies teamed up on an “unlawful horizontal agreement to eliminate or at least severely reduce the competitive threat posed by third-party merchants.”

This agreement “brought the number of third-party sellers of Apple products on Amazon Marketplace from roughly 600 to just seven sellers.” The lawsuit centers around a 2019 agreement between Apple and Amazon, which saw Apple establish an official storefront on Amazon for the first time.

The agreement has drawn antitrust scrutiny multiple times in the past as well:

The lawsuit being handled by Hagens Berman explains:

“From the outset of these discussions, the parties discussed ‘gating’ third-party resellers,” the lawsuit states. “Ultimately Apple proposed, and Amazon agreed, to limit the number of resellers in each country to no more than 20. This arbitrary and purely quantitative threshold excluded even Authorized Resellers of Apple products.”

According to the lawsuit, available data indicate that there were at least 100 unique resellers offering iPhones and at least 500 resellers of iPads on Amazon’s platform before the agreement, and after, no more than seven remained, a decrease of 98% of third-party Apple product resellers. The lawsuit references that Amazon admitted to Congress that it entered an agreement with Apple that permits only “seven resellers of new Apple products” on its platform.

Hagens Berman is encouraging people who bought an iPhone or iPad from the “Buy Box” on Amazon to contact the firm, saying that those people “may have overpaid and may be entitled to compensation under consumer-rights laws.”