Overview
- The Federal Trade Commission and attorneys general from 22 states filed a federal complaint on Monday accusing Amazon of secretly changing its ad-auction rules since about 2018–2019 to increase ad prices for roughly 1.2 million advertisers.
- The complaint says Amazon inserted a hidden “soft reserve” and used an “invented auction participant” to replace auction outcomes with higher prices, causing winners to pay nearly their full bids in roughly 70–80% of auctions.
- Regulators estimate the practice likely extracted more than $20 billion from advertisers and are seeking restitution, civil penalties and court orders to stop the alleged conduct.
- Amazon rejects the claims as misguided, says it has explained its systems to the FTC, and counters that advertisers saved about $8 billion from 2021 to 2025 while disputing any consumer price harm.
- The case adds to growing legal pressure on Amazon after a recent $2.5 billion FTC settlement over Prime enrollment and a separate antitrust suit, and it is expected to move through discovery where internal documents the complaint cites will be tested in court.