Overview
- The Federal Trade Commission filed the complaint in the U.S. District Court for the Western District of Washington on Monday, joined by 22 state attorneys general, alleging the scheme affected about 1.2 million advertisers and likely extracted more than $20 billion.
- The suit says Amazon secretly set undisclosed reserve charges and used an “invented auction participant” to raise auction prices, which the complaint alleges resulted in advertisers being charged their full winning bid roughly 80% of the time.
- Amazon sharply rejects the claims, calling the lawsuit misguided and saying its data show advertisers were not harmed and that advertisers saved about $8 billion from 2021 to 2025 as auction relevancy improved.
- Plaintiffs are seeking tens of billions in damages, civil penalties and restitution under federal and state consumer-protection laws, and the case is expected to move into contested discovery and motion practice.
- The litigation targets Sponsored Products, Sponsored Brands and Sponsored Display ads and could reshape fees for more than a million sellers, many small businesses, while adding to prior FTC enforcement against Amazon and broader scrutiny of digital ad markets.