Amazon and Apple cooperated to make the iPhone and iPad more expensive, says the antitrust lawsuit

Apple and Amazon worked together to raise iPhone and iPad prices by eliminating third-party Amazon sellers who offered Apple products at lower prices, according to a new antitrust lawsuit filed today in Washington.

The complaint, filed by the law firm Hagens Berman, says Apple and Amazon had an “unlawful horizontal agreement” that reduced the “competitive threat posed by third-party merchants,” in violation of federal antitrust laws. There were about 600 third-party sellers of Apple devices on Amazon Marketplace, and that number was reduced to just seven.

Amazon began eliminating third-party sellers after signing a 2019 deal with Apple to limit the number of sellers on Amazon’s marketplace to 20 per country. In return, Apple offered Amazon a discounted wholesale price for iPhones and iPads.

By restricting third-party sellers from offering Apple products, Amazon made itself the dominant seller of Apple products on the Amazon Marketplace, which Amazon and Apple “benefited” from, even if it “harmed the public.”

The lawsuit alleges that prior to the deal, third-party retailers offered “deeply discounted prices” for what Apple wanted from its online store, resulting in lower prices for consumers. For certain devices that have come up as a result of the deal, it is not said whether the vendors were offering legacy devices or current products, or if these were refurbished devices.

“When Apple and Amazon renewed their current reseller agreement in 2019, the only losers from their plan were consumers who were blindsided by price increases,” Berman said. “After finding iPhones and iPads on sale on Amazon Marketplace for up to 20% off, consumers are now locked into Apple’s premium pricing.”

Hagens Berman is seeking an injunction to prevent Amazon from blocking third-party Apple resellers and compensating consumers who “overpaid for iPhones and iPads.”