As soon as Lina Khan was appointed as the Federal Trade Commission (FTC) chair, the agency has been working on its most substantial antitrust case against Amazon.

Khan has already filed three lawsuits against the company, but the biggest could be filed in the next few weeks.  

(Photo : KAZUHIRO NOGI/AFP via Getty Images)
This picture taken on July 4, 2022 shows the logo of Amazon, a major online shopping company, displayed at Amazon Amagasaki Fulfillent Center in Amagasaki, Hyogo prefecture.

Amazon Facing Potential Antitrust Case From FTC

After filing three cases against Amazon, the FTC might file its biggest antitrust lawsuit against the company in the next few weeks, according to TechCrunch.

Based on documents seen by Bloomberg and three sources familiar with the case, the upcoming lawsuit will allege that Amazon systematically disadvantages merchants who do not use its fulfillment services.

Once FTC showed enough evidence of Amazon maliciously manipulating a market by leveraging its power to reward merchants that use its logistics services and punish those who don't, this could force the company to do a "restructure" or be broken up.

Bloomberg reported that Khan's office and FTC investigators have been honing the complaint for several months. They were finalizing key details like where to file the suit, as the FTC can file complaints in a federal court or in the agency's own administrative process. 

According to Bloomberg sources, Khan and her colleagues aim to file the case before personnel changes in August. Amazon will surely appeal once it is filed, and this results in a not-so-good outcome for the company.

Previous Cases Against Amazon

According to Bloomberg, the expected allegations are similar to a report in 2020 from a US House subcommittee, with Khan as a staff member. These allegations also overlap with a European antitrust case that charged the tech company with rewarding merchants that use its fulfillment services and using sellers' sales data to increase its own retail business.

In December 2022, Amazon agreed to a settlement with the EU, offering to change its "Buy Box" rankings and limit its use of marketplace seller data. Amazon has also promised to create a second offer box if there is a sufficient difference in price or time of delivery.

Amazon could file a similar offer to the US market. However, Khan has been publicly vocal about not accepting compromises from the company as she wants Amazon to "restructure" its business. CNBC reported that the FTC has already taken action against the tech company in other areas.

These include a consumer protection lawsuit alleging that Amazon used deceptive tactics to get users to sign up for its Prime subscriptions and recently settling two cases alleging privacy lapses in its Alexa voice assistant and Ring video security products.

Also Read: FTC Urges Court to Temporarily Block Microsoft's $69B Activision Blizzard Merger

Lina Khan as FTC Chair

Bloomberg reported that Lina Khan was appointed FTC chair in June 2021 and started recasting the Amazon probe. The agency's current investigation reportedly began two years before Khan became the chair. 

Khan was reportedly very hands-on with the investigation as she helped draft some lines of questions for the investigators and picked John Newman, a fellow academic with Justice Department experience, to help lead the investigation.

Bloomberg sources noted that the FTC had already interviewed nearly 30 employees of Amazon under oath last year.

Related Article: FTC Files Lawsuit Against Amazon For 'Intentionally' Sabotaging Customer's Attempts to Cancel Prime Program