Amazon is facing a $1 billion class action in the United Kingdom over allegations that it abused its dominant position in the market by favoring its own products using a secret algorithm.
According to the lawsuit, Amazon harms its customers by directing them to its featured offer, which hides cheaper deals and makes consumers pay more for products. It uses its Buy Box tool to direct customers to its own products as well as third-party items that use its order fulfillment and delivery services.
The lawsuit is expected to be filed in October with the Competition Appeal Tribunal (CAT) and will need to be upheld by the tribunal before it can proceed. It is filed on an “opt-out” basis, meaning that potential plaintiffs will be included in the lawsuit unless they choose to opt out, and Hausfeld, a specialist law firm, is leading the litigation.
Hausfeld says between 80% and 92% of Amazon purchases are made through the Buy Box tool, and anyone who lives in the United Kingdom and has been shopping on Amazon since October 2016 is included as claimant.
“This claim is without merit,” an Amazon spokesman said in a statement. “We’re confident that will become clear through the legal process.”
The sources for this piece include an article in Reuters.