This story was updated at 3:20 a.m. EST on Friday, June 7, 2024.
LONDON — A group of independent retailers in the U.K. is taking Amazon to court, claiming the online retail giant is stealing their proprietary data and using it to drive sales of its own products.
The British Independent Retailers Association up said Thursday it is taking legal action against Amazon in the Competition Appeal Tribunal in London. It is asking for 1 billion pounds in damages on behalf of its members, many of which are small businesses.
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The association believes that between October 2015 and the present, Amazon has been using proprietary, non-public data from its members to gain a competitive edge on the site.
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They are also accusing Amazon of manipulating the Amazon Buy Box, which gives certain retailers first dibs on sales, to benefit its own commercial operations.
BIRA said Amazon’s access to “such commercially valuable and confidential information helps Amazon decide whether to enter a new product segment based on its earnings and sales potential; which elements of a product to copy; how to price an item, and which consumers to target.”
The retail organization added that by “misusing their propriety data to bring to market rival products that are sold cheaper, Amazon is effectively pushing many of the U.K.’s independent retailers out of the market.
“The consequences of Amazon’s abusive conduct has been to inflate its profits and harm the U.K. retail sector, especially the smaller independent retailers who are struggling at a time of difficult economic circumstances,” the organization said.
BIRA said the total damage caused to U.K. retailers is estimated to be in the region of 1.1 billion pounds, including interest. The U.K. is Amazon’s largest European market.
Andrew Goodacre, chief executive officer of BIRA, described the claim as “the first step towards retailers obtaining compensation for what Amazon has done. I am confident that the [tribunal] will authorize the claim to go forward, and I look forward to the opportunity to present the case on behalf of U.K. retailers.”
An Amazon spokesperson said the company had not yet seen the complaint, “but based on the reporting so far we are confident that it is baseless, and that this will be exposed in the legal process.
“Over 100,000 small and medium sized businesses in the U.K. sell on Amazon’s store, and more than half of all physical product sales on our U.K. store are from independent selling partners. The fact is that we only succeed when the businesses we work with succeed,” the spokesperson added.
This isn’t the first time that Amazon has been accused of cheating its third-party retailers and customers.
Last September, the U.S. Federal Trade Commission and state attorneys general from 17 states brought a far-reaching antitrust lawsuit against Amazon. The case argues that the e-tail giant engages in unfair monopolistic practices that choke off competition and raise prices.
The FTC has asked for a permanent injunction, and the legal tussle is expected to go on for a number of years.
At the time, Amazon tried to poke holes in the lawsuit’s fundamental premise, arguing that its actions are not harmful to sellers and shoppers.
Instead, it said “the practices the FTC is challenging have helped to spur competition and innovation across the retail industry, and have produced greater selection, lower prices and faster delivery speeds for Amazon customers and greater opportunity for the many businesses that sell in Amazon’s store,” said Amazon general counsel David Zapolsky.
Separately, Amazon has been investigated by the European Commission multiple times over similar data issues and anti-competitive behavior involving third-party retailers.