FTC and 22 states sue Amazon over alleged secret ad surcharge scheme
Updated on: August 31, 2026 / 4:00 PM EDT / CBS News
TL;DR
- The FTC and 22 states are suing Amazon for allegedly inflating prices in its online advertising auctions.
- The lawsuit claims this practice, in place for seven years, surcharged over one million brands and sellers.
- Amazon allegedly charged winners their own bid price about 80% of the time, deviating from the 'second-price auction' standard.
- FTC Chairman Andrew Ferguson stated that these higher costs were largely passed on to American consumers.
- Amazon calls the lawsuit "misguided" and claims advertisers do not bid based on auction descriptions.
- Internal documents suggest Amazon knew advertisers believed they were in a true second-price auction.
- The lawsuit seeks to bar Amazon from the alleged scheme and require penalties and damages.