TALLAHASSEE, Fla. - Florida Attorney General James Uthmeier joined the Federal Trade Commission and 21 state attorneys general in a lawsuit against Amazon, alleging the tech giant inflated online advertising costs and drove up consumer prices.
Alleged Ad Scheme
What we know:
Florida and federal regulators filed a lawsuit in the U.S. District Court for the Western District of Washington, claiming Amazon misled sellers about its advertising auctions. Amazon allegeldy told advertisers they were competing in fair, "second-price" auctions, where the highest bidder pays just one cent more than the runner-up.
Instead, Amazon secretly tacked on surcharges and introduced fake participants to force bids higher, according to the complaint. By 2024, the lawsuit states that advertisers ended up paying their maximum winning bid about 80% of the time without being informed.
Impact on Consumers
Why you should care:
The lawsuit claims Amazon tested these hidden surcharges in 2019 and 2020 before expanding them, specifically boosting rates during peak shopping events like Prime Day and Black Friday. Internal company documents cited in court filings describe the practice as a "clever non-transparent way to charge first price".
Regulators argue these inflated ad fees caused small businesses and sellers to pass extra expenses along to shoppers. The lawsuit states everyday consumer products, including groceries and medicine, carried higher price tags as a direct result.
Scope of Damage
By the numbers:
Nationwide, the alleged scheme extracted more than $20 billion from roughly 1.2 million advertisers, including 500,000 small- and medium-sized businesses.
Florida sellers and vendors alone were allegedly overcharged by hundreds of millions of dollars over four years.
Attorney General James Uthmeier said Amazon padded its profits while forcing families to pay the price at checkout.
Florida is seeking penalties, consumer restitution and a permanent injunction against the retail giant under state consumer protection laws.
Next Legal Steps
What we don't know:
Officials have not yet provided a trial date or specified a timeline for potential consumer restitution payouts. Amazon has not yet stated in court records how it intends to respond to the allegations.
The Source: The information in this story was gathered from official press releases and court filings provided by Florida Attorney General James Uthmeier and the Federal Trade Commission.