Amazon faces UK class-action suit over ‘secretive’ algorithm

The Amazon suit will be filed at the Competition Appeal Tribunal by Oct 31, Hausfeld said. Damages, which are based on economists’ estimates from potential losses, could be as much as £900mil (RM4.76bil). — Reuters

Amazon.com Inc faces a UK class-action lawsuit over claims the tech giant uses a “secretive” algorithm to abuse its dominant position in the online marketplace.

Amazon has made millions of customers pay more by hiding better deals on platforms to boost its own products, Hausfeld, the law firm behind the case, alleges. It does this by using a “secretive and self-favouring algorithm” in its Buy Box feature.

A spokesperson for the Seattle-based company said the claim “is without merit and we’re confident that will become clear through the legal process”.

Britain’s opt-out class-action regime finally sparked into life last year after new laws allowed US-style claims under competition law. A flurry of cases have been filed recently including against Meta Platforms Inc’s alleged misuse of personal data and overcharging on Alphabet Inc’s Google Play Store. The latest suit will still need to be officially notified as a class action by a judge.

The Amazon suit will be filed at the Competition Appeal Tribunal by Oct 31, Hausfeld said. Damages, which are based on economists’ estimates from potential losses, could be as much as £900mil (RM4.76bil). Julie Hunter, a consultant who has worked with consumer rights organisations, will represent the potentially tens of millions of people who could be part of the suit.

Opt-out class-action style lawsuits mean someone impacted doesn’t have to be involved in the case to be included or to get a share in any eventual award.

Amazon has been dealing with wider antitrust scrutiny surrounding its Buy Box. The CMA is currently investigating the company’s suspected anticompetitive conduct relating to the feature, while the European Commission has been in talks to settle a case on possible bias.

“Amazon takes advantage of consumers’ well known tendency to focus on prominently placed and eye-catching displays, such as the Buy Box,” Lesley Hannah, a lawyer at Hausfeld, said. “Amazon should not be allowed to take advantage of its customers in this anticompetitive way.” – Bloomberg