A federal judge has ruled that the core state antitrust and consumer protection claims against Amazon over its Price Parity Restriction (PPR) can proceed, finding sufficient allegations of direct injury, timely filing, and plausible antitrust violations under both the rule of reason and per se standards. Some state-specific and consumer protection claims were dismissed as untimely or inapplicable.
Judge Vernon S. Broderick of the Southern District of New York granted in part and denied in part Amazon’s motion to dismiss the complaint. The judge’s 93-page opinion includes a detailed, state-by-state analysis of the antitrust and consumer protection laws of 29 states. Plaintiffs are expected to file an amended complaint (Mbadiwe v. Amazon.com, Inc., No. 22-CV-9542-VSB, S.D.N.Y. Sept. 18, 2025).
Price Parity Rule Artificially Inflated Prices Across Markets
The plaintiffs allege that Amazon’s price parity rule, which was in effect until March 2019, required third-party sellers to offer products on the Amazon platform at prices equal to or lower than those on other e-commerce platforms. They claim this policy artificially inflated prices across the market, as sellers were unable to offer lower prices on competing platforms. The plaintiffs argue that this practice harmed consumers by limiting price competition and maintaining supra-competitive prices.
The plaintiffs further allege that Amazon’s enforcement of the PPR, including sanctions such as removing sellers from the “Buy Box” or suspending their accounts, coerced compliance. They claim that this policy gave Amazon a competitive advantage over other e-commerce platforms and stifled competition.
Key Rulings
The court evaluated the case in the context of these categories:
Antitrust Standing:
The court found that the plaintiffs had sufficiently alleged antitrust standing under Associated General Contractors of California, Inc. v. California State Council of Carpenters, 459 U.S. 519 (1983). In that opinion, the Supreme Court established a multi-factor test to determine antitrust standing under Section 4 of the Clayton Act. Not all parties injured by antitrust violations have standing to sue; instead, courts must evaluate factors such as the directness of the injury, the existence of more direct victims, the speculative nature of damages, and the risk of duplicative recoveries or complex apportionment of damages. Associated General emphasized the importance of proximate causation and efficient enforcement of antitrust laws. Judge Broderick concluded that the plaintiffs plausibly alleged that their injuries—paying inflated prices on non-Amazon platforms—were directly tied to Amazon’s PPR.
Timeliness:
The Court addressed whether the claims were barred by statutes of limitations. In 1974, the U.S. Supreme Court in American Pipe & Construction Co. v. Utah, 414 U.S. 538 (1974), established that the filing of a class action tolls the statute of limitations for all asserted members of the class. This tolling applies until class certification is denied, allowing class members to file individual claims without being barred by the statute of limitations. The decision ensures that potential plaintiffs are not forced to file duplicative lawsuits while awaiting the outcome of class certification. Judge Broderick applied the tolling doctrine of American Pipe, pausing the statute of limitations for class members during the pendency of the class action. The judge also considered whether cross-jurisdictional tolling applied, finding that it did in many states.
Rule of Reason vs. Per Se Standard:
The court ruled that Amazon’s Price Parity Restriction was not a per se horizontal agreement, but instead a “hybrid agreement” involving both vertical and horizontal elements. While it is true that requiring third-party sellers to maintain price parity between products sold on Amazon and other platforms reflected a vertical relationship, it also impacted competition among sellers and Amazon’s competitors, creating horizontal effects. Because of this complexity, the court decided that claims of vertical price-fixing under certain state laws should be reviewed using the rule of reason, which considers detailed evidence about how the restraint affects competition instead of automatically declaring it illegal. In some states, such as Minnesota and Maryland, the court allowed claims to proceed under the per se standard, which deems certain practices inherently unlawful.
Timeliness of State-Specific Claims:
Judge Broderick dismissed claims under certain state laws, such as those in Tennessee and Mississippi, as untimely. Claims under other state laws, including those in New York, California, and Illinois, were allowed to proceed.
Consumer Protection Claims:
Some consumer protection claims were dismissed, such as those brought under the New Hampshire Consumer Protection Act, finding that the alleged conduct did not occur within the state.
The court granted the plaintiffs leave to amend their complaint to address deficiencies in the dismissed claims.
Implications
This case provides a detailed glimpse into Amazon’s business practices, particularly its treatment of third-party sellers and its impact on competition in the e-commerce market. Even though Amazon ended the price parity requirements, the case reminds companies with substantial platform power that certain envelope-pushing pricing policies and forcing aggressive agreements on third-party sellers can run afoul of antitrust laws and will be pursued by private plaintiffs.
Download the Opinion:
Mbadiwe et al v. Amazon.Com, Inc., 1_22-cv-09542, No. 87 (S.D.N.Y. Sep. 18, 2025)
Edited by Tom Hagy, Editor-in-Chief of the Mogin Law Blog.
