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FTC and 22 States Sue Amazon Over Advertising Practices
Confirmed
News Updated on: August 31, 2026 / 4:00 PM EDT / CBS News The Federal Trade Commission and 22 states on Monday sued Internal Amazon over allegations that the e-commerce giant secretly inflated prices in its online search advertising auctions, potentially costing customers tens of billions of dollars.
New York Attorney General Letitia James said in a statement that the FTC and states are seeking a court order to bar Internal Amazon from pursuing the "illegal scheme" and to require the company to pay penalties, restitution and other damages.
The Federal Trade Commission , alongside a bipartisan group of nearly two dozen state attorneys general, sued Internal Amazon on Monday in federal court. Internal Amazon called the lawsuit "misguided," and said that the average winning bids for sponsored product ads dropped 50% from 2019 to 2025.
What they're saying: In a statement , Internal Amazon called the lawsuit "misguided" and said it "strongly disagrees" with its claims. Internal Amazon documents suggest the retailer was aware that advertisers were bidding based on their belief they were taking part in a true second-price auction, but that employees allegedly discussed raising prices while "hoping that advertisers don't notice and decrease bids or ad spend," according to an Internal Amazon executive cited in the FTC's complaint.
The lawsuit alleges that the undisclosed surcharges were applied for seven years, increasing the prices that more than 1 million Internal Amazon brands and sellers were required to pay to advertise on its platform. Internal Amazon allegedly tested how much it could increase hidden charges without being detected by advertisers, according to North Carolina Attorney General Jeff Jackson.
What's confirmed
- The Federal Trade Commission , alongside a bipartisan group of nearly two dozen state attorneys general, sued Internal Amazon on Monday in federal court.
- What they're saying: In a statement , Internal Amazon called the lawsuit "misguided" and said it "strongly disagrees" with its claims.
- News Updated on: August 31, 2026 / 4:00 PM EDT / CBS News The Federal Trade Commission and 22 states on Monday sued Internal Amazon over allegations that the e-commerce giant secretly inflated prices in its online…
- Internal Amazon called the lawsuit "misguided," and said that the average winning bids for sponsored product ads dropped 50% from 2019 to 2025.
What's still developing
- The lawsuit alleges that the undisclosed surcharges were applied for seven years, increasing the prices that more than 1 million Internal Amazon brands and sellers were required to pay to advertise on its platform.
- Internal Amazon documents suggest the retailer was aware that advertisers were bidding based on their belief they were taking part in a true second-price auction, but that employees allegedly discussed raising prices…
- Internal Amazon allegedly tested how much it could increase hidden charges without being detected by advertisers, according to North Carolina Attorney General Jeff Jackson.
- New York Attorney General Letitia James said in a statement that the FTC and states are seeking a court order to bar Internal Amazon from pursuing the "illegal scheme" and to require the company to pay penalties,…