A proposed US class-action lawsuit has been filed against Amazon.com, accusing the online retailer of violating consumer protection laws, Reuters reported.
The lawsuit alleges that Amazon’s algorithm for selecting items to display in its ‘Buy Box’ often hides lower-priced options with faster delivery times, pushing shoppers towards higher-priced items and earning extra fees for the company.
Deceptive algorithm practices
According to Reuters, filed in a federal court in Seattle, the complaint cites Amazon’s algorithm as a key factor in misleading consumers.
The algorithm allegedly favours higher-priced items, leading shoppers to believe they are getting the best deals, when in fact, lower-priced alternatives may exist.
The lawsuit claims that nearly 98% of shoppers opt for Amazon’s suggested items, assuming they are the most cost-effective choices.
Implications and legal action
The lawsuit seeks damages for alleged violations dating back to 2016 under Washington state’s deceptive trade practices law.
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The news agency reported that plaintiffs argue that Amazon’s practices have placed a significant burden on consumers.
Unlike previous litigation focused on antitrust issues or harm to sellers, this case emphasises the impact on consumers from deceptive practices.
California residents Jeffrey Taylor and Robert Selway are the plaintiffs in the case, which is titled Taylor et al v Amazon.com Inc.
Amazon has recently been involved in several legal matters. Last week, the company’s Counterfeit Crimes Unit collaborated with BMW Group to win a joint civil lawsuit against four individuals in Spain, marking a victory in the fight against counterfeit goods.
Additionally, Amazon, along with tech giant Apple, saw a positive development in its legal battle in Spain.
The Spanish High Court decided to suspend the imposition of fines totalling €194m ($209m) on both companies.
This decision was made as part of an appeal process initiated by Amazon and Apple against penalties imposed by the Spanish competition regulator, La Comisión Nacional de los Mercados y la Competencia, for alleged anticompetitive practices.