Damning Emails Show Amazon Directing Vendors to Raise Prices on Walmart and Chewy, California AG Says

California Attorney General Rob Bonta filed an expanded antitrust complaint against Amazon on Wednesday, introducing newly obtained internal company emails that he said showed Amazon executives explicitly discussed using the company's algorithmic pricing system to maintain elevated prices across competing retailers including Walmart, Chewy, and Target, and to suppress price competition by threatening to demote or remove third-party sellers who offered lower prices elsewhere. The filing represents the most substantive evidentiary development yet in California's two-year-old antitrust case against the company and came as federal antitrust officials at the Federal Trade Commission said they were monitoring the state's proceeding with interest.

The emails, obtained through civil discovery and included as exhibits in the amended complaint, showed communications between Amazon's marketplace and pricing teams discussing the operation of what the company internally called its Minimum Margin system and, in later documents, referred to as its "price parity" enforcement architecture. In one email exchange from 2021, a senior pricing team executive wrote that the goal of the system was to ensure that "items purchased on Amazon are never systematically cheaper elsewhere" and discussed specific thresholds at which sellers who undercut Amazon prices on other platforms would see their products' search rankings reduced or their buybox eligibility suspended. The buybox — the default purchase button prominently displayed on product pages — is estimated to capture more than 80 percent of all Amazon purchases in product categories where it appears.

Amazon disputed the characterization of the emails, arguing through a spokesperson that the documents were being misread and that price parity policies were standard competitive practice aimed at ensuring Amazon customers received good value. The company said its policies did not prevent sellers from setting their own prices on other platforms and noted that prices on Amazon fall frequently. Legal experts said the distinction between prohibiting lower prices elsewhere and penalizing sellers who offer them was legally significant and would likely be a central factual dispute at trial.

California's case rests on the theory that Amazon's pricing policies constitute illegal restraints on trade under both federal and California antitrust law by suppressing price competition across the retail market. Bonta argued that because Amazon accounts for approximately 40 percent of U.S. e-commerce by revenue and an even higher share of online product search, a seller effectively cannot afford to be penalized on Amazon, giving the company the leverage to function as a price floor-setter for large categories of consumer goods. The complaint alleged that this dynamic had kept consumer prices higher than they would be in a competitive market.

The case is scheduled for trial in January 2027. Similar cases brought by the FTC and by a coalition of states led by Washington State are pending in federal court. Amazon faces separate antitrust proceedings in the European Union over similar algorithmic pricing practices.