Massachusetts and Rhode Island Among States Suing Amazon

The U.S. government is suing one of the country's biggest retailers and 17 states are with them. Among those states are both Massachusetts and Rhode Island.

So, just what is the lawsuit all about?

If you guessed monopoly, you nailed it.

In a landmark antitrust lawsuit, the Federal Trade Commission (FTC) along with 17 attorneys general are suing Amazon for basically not playing fair.

The massive retailer, which has become not only a global marketplace for a wide range of products but also a logistics network and cloud provider, is allegedly unfairly promoting its own platform and services over those of third-party sellers who rely on the site for distribution.

The lawsuit also alleges that because of the site's dominance in e-commerce, sellers have no choice but to agree to Amazon's terms on price and distribution thereby not allowing them to offer similar or perhaps even lower prices to other online distributors.

According to the FTC Chair Lina Khan, Amazon's size and power allow it "to suffocate rivals, deprive them of oxygen, and really leave a stunted landscape in its wake.”

What Does the Lawsuit Against Amazon Mean For the Company?

The complaint filed on Tuesday, Sept. 26, in U.S. District Court for the Western District of Washington is actually seeking to block Amazon from engaging in the allegedly anticompetitive behavior.

That could mean a possible breakup of the massive company that the FTC alleges is an "illegal monopoly."

But it could also mean just more money for the consumer.

Another potential outcome to this lawsuit is that the government would raise Amazon's cost of doing business, costs that may simply be passed along to buyers. Rates for subscriptions such as Prime could go up, products on the site could cost more and shipping times could become much slower.

Obviously, this is a lawsuit in its beginning stages that could drag out in court for years, but Amazon shoppers may want to be aware that a change could come.