Longtime Amazon critic Lina Khan seeks to rein in retailer

By David Shepardson

WASHINGTON (Reuters) -Federal Trade Commission Chair Lina Khan’s years-long push to challenge the power of Amazon.com (NASDAQ:) reached a turning point on Tuesday when her agency filed a sweeping antitrust lawsuit against the online retailer.

In 2017, Khan wrote an influential academic article arguing the company’s structure and practices posed anticompetitive concerns and had escaped antitrust scrutiny.

“With its missionary zeal for consumers, Amazon has marched toward monopoly by singing the tune of contemporary antitrust,” Khan, then 29, wrote in the Yale Law Journal. Amazon “has evaded government scrutiny in part through fervently devoting its business strategy and rhetoric to reducing prices for consumers.”

Six years later, Khan, who became the FTC’s chair in 2021, is leading the agency’s antitrust charge against the online retailer. The FTC on Tuesday asked a judge “to put an end to Amazon’s illegal course of conduct, pry loose Amazon’s monopolistic control, deny Amazon the fruits of its unlawful practices, and restore the lost promise of competition.”

Khan said on Tuesday that Amazon “has used a set of punitive and coercive tactics to unlawfully maintain its monopolies.” She argued that the company is “exploiting its monopoly power to enrich itself while raising prices and degrading service for the tens of millions of American families who shop on its platform.”

Amazon has fought back over the years.

In 2021, the retailing giant filed a petition asking for Khan to be recused on Amazon-related matters, saying she had “repeatedly called for breaking up Amazon throughout her career.” On Tuesday it rejected the antitrust lawsuit, saying Amazon has helped to spur competition and innovation across the retail industry.

Under Khan, the FTC has taken an aggressive stance on Amazon, accusing it of enrolling millions of consumers into its paid subscription Amazon Prime service without their consent and making it hard for them to cancel.

The FTC on May 31 announced a $5.8 million settlement with Amazon’s Ring doorbell camera unit after the agency said cameras had been used for spying on some customers. Amazon also agreed in May to pay $25 million to settle FTC allegations it violated children’s privacy rights by failing to delete recordings by virtual assistant Alexa.

Long before her time at the FTC, Khan has been an influential critic of Big Tech. As a staffer for the House Judiciary Committee’s antitrust panel, Khan helped write a massive report alleging abuses of market dominance by Amazon, Apple (NASDAQ:), Meta Platforms (NASDAQ:)’ Facebook and Alphabet (NASDAQ:)’s Google.

Since her 2017 article, Amazon’s market capitalization has more than doubled to $1.35 trillion as its revenue grew from $177 billion to $434 billion last year. The company has invested more than $530 billion in the United States since 2010 and now employs 1.54 million people.

But Khan has powerful supporters. Senator Bernie Sanders, who has boosted Khan over the years, praised the lawsuit on Tuesday, saying it is “a poster child for the massive concentration of ownership in sector after sector that fills the pockets of shareholders and forces Americans to pay higher prices.”