James Uthmeier
TALLAHASSEE, Fla. – Florida Attorney General James Uthmeier has joined the Federal Trade Commission and 21 other states in suing Amazon, alleging the company spent years secretly inflating the prices Florida businesses pay to advertise on its platform.
Uthmeier say those costs then were passed on to Florida families at checkout.
“Amazon told Florida businesses they were bidding in a fair auction,” Uthmeier said. “That was false.
“Amazon hid a surcharge, padded its own profits, and those costs landed on Florida families buying groceries, medicine, and everyday essentials. Amazon should expect to be held accountable.”
According to the complaint filed in U.S. District Court for the Western District of Washington, Amazon represented for years that it ran “second-price” auctions in which the winning advertiser would pay only one cent more than the next-highest bidder.
In practice, Amazon added an undisclosed surcharge and used an “invented auction participant” to drive prices higher than genuine competition would have produced. By 2024, Amazon charged Sponsored Products advertisers their own winning bid approximately 80 percent of the time, converting a nominally second-price auction into a first-price auction without telling customers.
The complaint alleges Amazon began testing hidden surcharges in 2019 and 2020. After concluding advertisers could not detect the extra charges, Amazon rolled them out across the platform and ramped them higher on Prime Day and Black Friday. Internal documents quoted in the complaint describe “a surcharge hidden in it” and a “clever non-transparent way to charge first price.”
Those overcharges did not stop with the businesses that buy ads. The complaint alleges that a significant portion of the advertising costs paid by Amazon sellers “are ultimately passed through to and paid by Amazon shoppers in the form of higher prices,” including on low-margin necessities families buy every day.
Nationally, the scheme is alleged to have extracted more than $20 billion from approximately 1.2 million advertising customers, including more than 500,000 small- and medium-sized businesses. Sellers and vendors based in Florida have been overcharged by hundreds of millions of dollars over more than four years.
Amazon understood that disclosing the change would cause advertisers to lower their bids. The complaint alleges the company concealed the surcharges, gave false and misleading answers when advertisers asked whether the auction format had changed, and continued the practice after the FTC notified Amazon of its investigation.
The lawsuit alleges Amazon violated the Florida Deceptive and Unfair Trade Practices Act. The AGs and the FTC seek a permanent injunction, consumer restitution, disgorgement of ill-gotten gains, civil penalties, attorney fees and other relief.
Florida is joined by the FTC and the attorneys general of Alaska, Arizona, California, Colorado, Idaho, Illinois, Indiana, Iowa, Kentucky, Louisiana, Maryland, Nebraska, New Jersey, New York, North Carolina, Oklahoma, Pennsylvania, Rhode Island, South Carolina, Vermont and Washington.
