Interview Preparation

The moment Amazon feared when FTC chair Lina Khan was appointed soon could come: Bloomberg reports that the agency is putting the finishing touches on its most substantial antitrust case against the tech giant, and could file a lawsuit in the coming weeks.

According to documents seen by Bloomberg and known sources, the upcoming lawsuit will allege that Amazon systematically hurts merchants who don’t use certain “optional” services like “Fulfilled by Amazon.” If the FTC can show that Amazon is maliciously manipulating a market in which it has something of a monopoly power, it could argue that the company needs to be broken up or restructured.

Doing so isn’t easy, though: Amazon fattened itself on the doctrine that, essentially, if consumers aren’t directly affected, even something that looks, walks, and talks like a monopoly isn’t. Khan challenged this doctrine in a lengthy law review article that marked her as a rising star and potentially the biggest threat to a similar rising tech industry.

But this would be the biggest proof yet of his claim that monopoly can arise in other forms, of which Amazon is a prime example. If he could establish as a precedent that the use of network effects and unlimited cash to undermine and replace competitors is a dangerous new form of market control, it would be a tectonic shift in regulation.

The FTC has already taken on Amazon for three separate and unrelated issues in the past month. Amazon settled allegations that its Ring-branded doorbells allowed customers to be spied on and so? had “disobeyed” children’s data privacy laws with Alexa; a third case was filed last week accuse the online retailer of deceptive practices in connection with your subscription services.

The goal is reportedly to file the case before certain logistical problems arise at the FTC in August, so getting the case in order and getting it out the door has been his focus in recent months. The case has allegedly been in the works for several years.

amazon has previously suggested that Khan’s frequent criticism of them means she “can no longer view the company’s antitrust defenses with an open mind.” That objection has been received with the consideration she deserves, though Khan may still have to tread carefully to avoid a situation where she is the deciding factor in a case.

I’ve reached out to Amazon and the FTC for comment and will update if I hear from them.