Every seller wants to learn how to get the highest prices for their online sales. But as we’ve warned previously, the government is watching to make sure sellers don’t engage in conduct with each other that it deems anti-competitive and harmful to consumers.
In July, the government exposed what it called a conspiracy among Amazon sellers to fix prices of DVDs and Blu-Ray discs when it announced that a seller in Tennessee had pleaded guilty. Today, the Feds named three other Amazon sellers who pleaded guilty, one from New Jersey and two from New York.
According to the charges, the sellers “agreed to raise and maintain the prices of DVDs and Blu-Ray Discs sold in their Amazon Marketplace storefronts.”
While the government’s Information against the Tennessee seller details the allegations, it leaves out exactly how sellers coordinated prices or set floor prices for each title (it’s hard to believe online sellers could coordinate prices without using software; in 2015, the Feds charged several Amazon sellers with using an algorithm to fix prices of movie posters):
For the purpose of forming and carrying out the charged combination and conspiracy, the defendant and co-conspirators did those things that they combined and conspired to do, including, among other things:
a. engaged in discussions in the United States, including from within the
Eastern District of Tennessee, concerning prices for DVDs and Blu-Ray Discs sold through the Amazon Marketplace platform to customers located throughout the United States;
b. agreed during those discussions to suppress competition by raising and maintaining particular pricing for DVDs and Blu-Ray Discs sold through the Amazon Marketplace platform to customers located throughout the United States;
c. agreed during those discussions to monitor and exchange pricing with one another and others in order to implement and enforce this agreement;
d. agreed during those discussions to establish floor pricing for DVDs and Blu-Ray Discs sold through the Amazon Marketplace platform to customers located throughout the United States;
e. monitored current pricing of DVDs and Blu-Ray Discs offered by sellers on the Amazon Marketplace platform to customers located throughout the United States;
f. communicated with one another through the use of interstate wire transmissions including email, text message, and phone calls;
g. sold DVDs and Blu-Ray Discs through the Amazon Marketplace platform within the United States at collusive and noncompetitive prices; and
h. accepted payment for sales of DVDs and Blu-Ray Discs sold through the Amazon Marketplace platform to customers located throughout the United States at collusive and noncompetitive prices.
It’s also interesting to note that the government described one of the defendant’s affected sales to US customers of DVDs and Blu-Ray Discs sold through the Amazon Marketplace as totaling $360,000. (How many readers want to know his profit on those sales?)
We don’t know if or how many more sellers may be charged in the case – the Department of Justice’s Antitrust Division called it an “ongoing investigation” and said anyone with information concerning price fixing or other anticompetitive conduct related to the sale of DVDs, Blu-Ray Discs, or other products sold through Amazon Marketplace should contact its Chicago Office.
The announcement also quoted the Antitrust Division’s Jonathan Kanter: “As American consumers increasingly turn to e-commerce, it is critically important to deter, detect and prosecute crimes that prevent fair and open competition in online marketplaces. These charges demonstrate the Antitrust Division’s continued commitment to prosecuting anticompetitive conduct wherever it may occur.”
According to a page on the DOJ website, the Tennessee man was scheduled to be sentenced today (January 7, 2022), and the three other defendants are scheduled for sentencing on September 30, 2022.
Edited 1/10/2022 to clarify the seller sold $360,000.