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2 clusters · 13 sources · 3 days · First seen · Last updated

FTC and states lawsuit against Amazon advertising

Overview

The Federal Trade Commission (FTC) and 22 U.S. states have filed a lawsuit against Amazon in the U.S. District Court for the Western District of Washington. The legal action alleges that Amazon manipulated digital advertising auctions to overcharge advertisers by more than $20 billion since 2019.

Regulators claim Amazon used undisclosed ‘soft reserve prices’ to act as phantom bidders. This practice allegedly converted many ‘second-price’ auctions—where winners pay only one cent more than the runner-up—into ‘first-price’ auctions, where advertisers pay their full bid. Reports indicate that by 2024, approximately 79% to 80% of Sponsored Products auctions resulted in advertisers paying their full winning bid, a sharp increase from previous years.

The lawsuit estimates that 1.2 million advertising customers, including 500,000 small and medium-sized businesses, were affected. Amazon has denied the allegations, stating the lawsuit is misleading and misinterprets advertiser behavior. The company maintains its systems have saved advertisers billions through improved relevance and intends to defend itself in court.

Entities

Federal Trade Commission · Amazon · FTC · Western District of Washington · Andrew N. Ferguson

Timeline

  1. 7 days ago

    [BUSINESS] 2 sources
    Amazon sued by FTC and 22 states over alleged $20 billion advertising fraud

    The FTC and 22 states are suing Amazon, alleging the company used hidden reserve prices to overcharge advertisers by over $20 billion through rigged digital ad auctions.

  2. 10 days ago

    [BUSINESS] 11 sources
    Amazon sued by FTC and 22 states over alleged ad auction manipulation

    The FTC and 22 states have sued Amazon, alleging the company used secret 'soft reserve prices' to manipulate ad auctions and extract tens of billions of dollars from over a million advertisers.

Sources

business-punk.com · cryptobriefing.com · elpopularnews.com · epochtimes.com · fourweekmba.com · gamestar.de · geekyalgeria.com · mediabistro.com · messengernews.net · pagosadailypost.com · socialsamosa.com · thebaynet.com · thecooldown.com