Anti-Trust Suit Against Apple and Amazon Over Selling Apple Products

June 9 (Reuters) - Apple (AAPL.O) and (AMZN.O) must face a consumer antitrust lawsuit in U.S. court accusing them of conspiring to artificially inflate the price of iPhones and iPads sold on Amazon’s platform, a federal judge in Seattle ruled on Thursday.

The plaintiffs are U.S. residents who bought new iPhones and iPads on Amazon beginning in January 2019. They contend an agreement between Apple and Amazon that went into effect that year restricted the number of competitive resellers in violation of antitrust provisions.

In 2018, according to the lawsuit, there were some 600 third-party Apple resellers on Amazon. Apple agreed to give Amazon a discount on its products if Amazon reduced the number of Apple resellers from its marketplace, the lawsuit alleged.

Apple has argued that its agreement with Amazon limited the number of authorized resellers to help minimize counterfeit Apple goods being sold on the e-commerce platform.

There are two ways to look at this. Amazon sellers know Amazon does stuff like this to eliminate competition.

They do have a point about unauthorized selling and other problems.

And now the courts will determine if Amazon & Apple colluded to raise consumer prices, and eliminate competition. Which are both illegal. Or if this was something the two companies did to protect consumers from fraud. Which is legally required of both companies.

I suspect that both companies were motivated by both a little. The court isn’t well equipped for grey, so this will be long and boring. Likely, the end result will be some sort of settlement in which Amazon/Apple give the government millions, and admit no wrong, make a few minor adjustments for show. And consumers/sellers get nothing.


Above average balance in the reporting.

Not balanced but better than usual.

BTW I side with Amazon and Apple on limiting the number of vendors, on this and many other items.


Indeed, but just like with IP infringement (in actual court, not Amazon), the ultimate question often is not if there is a use of the IP but why is the IP being used and why is the Rights owner seeking enforcement. Successful enforcement always goes we’re just protecting consumers. It always ends badly, if it can be established that there was discussion about company profits.

Not always. Limiting access in or on a venue can be driven by marketing considerations including image.

Protecting your image is a valid reason for eliminating vendors or products.

There are myriad ways to do this without violating anti-trust law. Many manufacturers require their resellers to sell the entire product line, and will not authorize any to sell just the hot products, for example.

I was a high volume seller of a product line related to the human creator of Ethernet. We were not authorized because we would not carry the rest of their products. We received gray market product from one of their regional distributors (we were outside the region). He would not have met his quota without us. The manufacturer knew and looked the other way. Their rule was important but not that important. Our behavior did not undermine their goals for limited distribution. We charged enough, we did not advertise broadly, and we looked like we belonged.

Running marketing for the network builder, I had two lawyers on my staff whose job was making sure whatever we did met anti-trust requirements. And they found a way for 99% of our deals, promotions and policies.

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Call me a little ignorant, but I was under the impression that Apple 1000000% controls the price their items sell at, not just on Amazon, but EVERYWHERE.

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Apple’s strength is their control of their prices and margins and market perception of a premium product.

It never has been their technology.


I think you are absolutely on the target here.

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