Amazon hit with $1 billion lawsuit in UK over alleged buy box manipulation

Retail giant Amazon is facing a hefty £1 billion ($1.28 billion) class action lawsuit in the UK over claims that it misused private data to gain an unfair advantage and boost its own profits.

The British Independent Retailers Association (BIRA) claims Amazon used confidential information provided by sellers on its marketplace to undercut them. This data supposedly allowed Amazon to offer the same products directly, but at lower prices.

"Small retailers have little choice but to use Amazon's platform given its reach," said BIRA CEO Andrew Goodacre. "This lawsuit aims to stop Amazon from putting them out of business by exploiting their data."

The lawsuit, filed with the Competition Appeal Tribunal also alleges that Amazon has been manipulating the prominent "Buy Box" feature on its website. This section, displayed near product pages, significantly influences buying decisions. BIRA alleges Amazon manipulates the Buy Box to favor its own products.

This alleged manipulation, the lawsuit argues, has harmed independent retailers who rely on Amazon's marketplace.

This isn't the only legal trouble Amazon faces regarding the Buy Box. A separate lawsuit, valued at £900 million ($1.1 billion), was filed on behalf of consumers over similar concerns. Additionally, Britain's Competition and Markets Authority (CMA) launched an investigation into Amazon's practices in 2022, including its handling of the Buy Box. While the CMA secured commitments from Amazon last year to promote fair competition, this lawsuit suggests retailers remain unsatisfied.

Bira added that the lawsuit also seeks to represent all UK consumers who have made purchases on Amazon since October 2016, potentially impacting a vast number of people. BIRA argues that these consumers were likely influenced by the skewed Buy Box placement, potentially leading to higher prices or a limited selection of sellers.

Amazon has yet to comment on the specifics of the lawsuit.

The outcome of this lawsuit could have significant implications for Amazon's business model in the UK and potentially beyond. If BIRA prevails, it could force Amazon to change how it operates its marketplace, potentially creating a fairer playing field for independent sellers.