Amazon must face part of online retailer's pricing lawsuit, US judge rules

​Amazon.com has failed to dismiss a lawsuit that accused the e-commerce giant of harming competition in the online department store market, causing its rival Zulily to lose sales and causing consumers to pay higher prices.

Seattle-based U.S. District Judge John Chun in a rulingopen a new tab on Dec. 31 said Zulily may proceed with allegations that some of Amazon's business practices could violate U.S. antitrust law.

Zulily's lawsuit challenged Amazon's “anti-discount” policies, which it said prohibited retailers from offering lower prices than Amazon.

The lawsuit claims that Amazon illegally used contracts and other means to prevent hundreds of thousands of third-party merchants from allowing Zulily and other similar sites to sell their products at a lower price.

Chun dismissed part of the December 2023 complaint, ruling that Zulily had not shown that third-party retailers and wholesale suppliers were engaging in a price-fixing conspiracy. He also dismissed a claim that Amazon violated a Washington state consumer protection law.

Amazon had asked the judge to dismiss the entire lawsuit. The company has denied any wrongdoing.
Amazon declined to comment Thursday. Zulily's attorneys did not immediately respond to a request for comment.

Zulily's lawsuit said its wholesale suppliers could not afford to violate Amazon's pricing rules, and that Amazon set out to destroy the company when it emerged as a rival online superstore.

Amazon responded that matching rivals' prices was a “classic form of price competition.” Amazon also questioned whether Zulily qualified as a web hypermarket. He had urged Chun to rule that Zulily had no legal standing to sue in the first place.
Days after the lawsuit was filed, Zulily closed and entered into an asset liquidation agreement. Zulily has since sold the intellectual property rights to his name.

Chun gave Zulily until Jan. 31 to file an amended complaint.

The case is Zulily Inc v. Amazon.com Inc, U.S. District Court for the Western District of Washington, No. 2:23-cv-01900-JHC.