March 7, 2017 - To view the full text, click here.
A source provided The Capitol Forum with the text of an email from a manufacturing executive describing an agreement with Amazon to control prices. If the manufacturer’s characterization of the agreement is accurate, Amazon is at risk of investigation under Sherman Act Section 1 for price fixing and collusion, for which the applicable legal standard is per se liability. Even in the absence of such explicit agreement, Amazon is vulnerable to investigation under both Section 1 and Section 2 for its brand gating practice, whereby Amazon works with manufacturers to expel third-party sellers–effectively forming a horizontal cartel of sellers who will stick to minimum advertised prices or above–and gain market power in particular brands and product categories as a direct seller itself.
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