Amazon used a series of illegal strategies to boost profits at its online retail empire, including an algorithm that pushed up prices US households paid by more than $1 billion, the US Federal Trade Commission said in a new court filing on Thursday.
Details from FTC’s lawsuit against Amazon filed in September were made public on Thursday as a new version of the lawsuit was made available in a Seattle court with fewer redactions.
The FTC said that Amazon created a “secret algorithm internally codenamed ‘Project Nessie’ to identify specific products for which it predicts other online stores will follow Amazon’s price increases,” according to Reuters.
The FTC also alleged that executives at the company intentionally deleted messages on the messaging app Signal. They used a feature that makes messages disappear in an act that “destroyed more than two years” worth of communications from June 2019 to “at least early 2022” despite the trade commission asking Amazon not to do so, ABC News has reported.
The FTC and 17 states had filed the lawsuit against Amazon in September, alleging the company was using its dominant position in the market to inflate prices on and off its platform while overcharging sellers and stifling competition.
Amazon had said that the lawsuit would lead to higher prices and slower deliveries for consumers—and hurt businesses. “If successful, (the lawsuit would) force Amazon to engage in practices that actually harm consumers and the many businesses that sell in our store—such as having to feature higher prices, offer slower or less reliable Prime shipping, and make Prime more expensive and less convenient,” David Zapolsky, Senior Vice President, Global Public Policy & General Counsel at Amazon, said in a statement.
