Tag Archives: Lawsuit

California Attorney General Sues Amazon For Blocking Price Competition



California Attorney General Rob Bonta announced a lawsuit against Amazon alleging that the company stifled competition and caused increased prices across California through anticompetitive contracting practices in violation of California’s Unfair Competition Law and Cartwright Act.

Further information includes:

In order to avoid competing on prices with other online e-commerce sites, Amazon requires merchants to enter into agreements that severely penalize them if their products are offered for a lower price off-Amazon. In today’s lawsuit, Attorney General Bonta alleges that these agreements thwart the ability of other online retailers to compete, contributing to Amazon’s dominance in the online retail marketplace and harming merchants and consumers through inflated fees and higher prices.

“For years, California consumers have paid more for their online purchases because of Amazon’s anticompetitive contracting practices,” said Attorney General Bonta. “Amazon coerces merchants into agreement that keep prices artificially high, knowing full well they can’t afford to say no. With other e-commerce platforms unable to compete on price, consumers turn to Amazon as a one-stop shop for all their purchases. This perpetuates Amazon’s market dominance, allowing the company to make increasingly untenable demands on its merchants and costing consumers more at checkout across California…”

The Attorney General provided information about the lawsuit against Amazon and requested relief:

The Attorney General’s lawsuit seeks an order from the San Francisco Superior Court that stops Amazon’s anticompetitive behavior and recovers the damages to California consumers and the California economy. Specifically, the lawsuit asks the Court to:

  • Prohibit Amazon from entering into and enforcing its anticompetitive contracts that harm price competition;
  • Require Amazon to affirmatively notify vendors that it does not require sellers to offer prices on par with off-Amazon prices;
  • Appoint a Court-approved monitor, to ensure Amazon’s compliance with the Court’s order;
  • Order damages to compensate for the harms to consumers through increased prices; and
  • Order Amazon to return its ill-gotten gains and pay penalties to serve as a deterrent to other companies contemplating similar actions.

The Wall Street Journal reported that the suit is the result of an investigation the began in early 2020. It seeks unspecified damages for harm to the state economy and $2,500 for each violation of the state’s civil and professional code proved at trial.

According to The Wall Street Journal, the lawsuit represents the biggest legal challenge to date in the U.S. for Amazon, which was previously sued by the District of Columbia and is being investigated by the Federal Trade Commission, the European Union, and a congressional committee. Because California is the nation’s most populous state and biggest economy, its business regulations have long swayed how companies operate across the country, The Wall Street Journal reported.

If things work out the way Attorney General Bonta wants them to, I think it will could cause other states to create similar lawsuits against Amazon. The result could potentially make it less expensive for people to buy products from Amazon.


Judge Rejects Elon Musk’s “Absurdly Broad” Twitter Data Request



A Delaware judge called Elon Musk’s request for years of data about Twitter Inc.’s spam and fake accounts “absurdly broad” but ordered the social-media company to provide a subset of the information in the continuing legal battle over the billionaire’s soured $44 billion takeover, The Wall Street Journal reported.

Chancellor Kathaleen McCormick said in a decision Thursday that the request by Mr. Musk’s legal team to compel the company to produce “trillions upon trillions of data points” for more than 200 million users was overly burdensome and “no one in their right mind has ever tried to undertake such an effort.”

According to The Wall Street Journal, the judge ordered Twitter to produce a narrower section of the data requested, including a historical snapshot of accounts that were reviewed by the company to determine the number of spam and fake accounts on its platform, an issue central to the dispute over Mr. Musk’s effort to terminate the merger agreement and substantiate his counterclaim of fraud.

The Washington Post reported that Musk had been angling to exit the deal since he terminated his agreement in July, after agreeing to purchase the social media giant for $44 billion in April. Twitter sued shortly after, followed by a countersuit from Musk.

According to The Washington Post, Musk’s team had been seeking information that could more deeply reveal Twitter’s internal methodologies and understanding of the bot issue. Musk’s lawyers referenced a whistleblower complaint obtained by The Washington Post during a Wednesday hearing, in which former head of security Peiter Zatko alleges Twitter was not incentivized to accurately count bots and spam.

The Verge reported that Musk’s lawyers wanted “all of the data Twitter might possibly store for each of the approximately 200 million accounts included in its mDAU count every day for nearly three years,” covering trillions of data points, McCormick wrote in her ruling “Plaintiff [Twitter] has difficulty quantifying the burden of responding to that request because no one in their right mind has ever tried to undertake such an effort. It suffices to say, Plaintiff has demonstrated that such a request is overly burdensome.”

Personally, I think this push for “all the data Twitter might possibly store” for three years is a tactic being used by Musk’s lawyers in an effort to get out of the $44 billon agreement that he signed with Twitter. I believe that Elon Musk is very likely going to be willing to spend whatever it takes to sever himself from the deal that he signed with Twitter – and then changed his mind about. In this situation, it appears Musk and his lawyers want to be as annoying as possible – until Musk gets what he wants.

According to The Verge, however, the judge partially agreed to Twitter’s request for documents from Musk’s side as Twitter pursues information on data analysis Musk performed before he attempted to exit the deal. “At a minimum, Defendants must produce the Analyses,” writes [Judge] McCormick, as well as identification of related information on a privilege log so that Twitter’s lawyers could request access to specific documents.


FTC Agrees To Remove Zuckerberg From Antitrust Suit



The Federal Trade Commission said it will remove Mark Zuckerberg, the Chief Executive of Meta, from a lawsuit to block the company’s acquisition of Within Unlimited, an artificial intelligence start-up, The New York Times reported.

According to The New York Times, the FTC said in a court filing that it agreed to drop Mr. Zuckerberg as a defendant after Meta, formerly known as Facebook, promised he would not try to personally purchase Within Unlimited. Meta had asked the agency to remove Mr. Zuckerberg as a defendant.

Within Unlimited, Inc., is a virtual reality (VR) media and technology company. Bloomberg reported that Within Unlimited, Inc. develops advanced technology for telling stories in immersive media. Within Unlimited serves customers in the State of California.

The Within Unlimited website states that their flagship product is Supernatural, a complete fitness center service for Oculus Quest that is designed with the sole purpose of giving people the time of their lives working out, so that taking on a healthy lifestyle is easy and full of joy. Within Unlimited also has Wonderscope, an iOS app for kids that uses augmented reality to transform ordinary spaces into extraordinary stories.

To me, it seems very clear that Meta’s interest in Within Unlimited is to boost its Oculus VR device. It sounds like if Meta is allowed to acquire Within Unlimited, that would remove an independent VR company into Meta’s product line.

According to The New York Times, the FTC filed its complaint with U.S. District Court for the Northern District of California, to prevent Meta and Mr. Zuckerberg from acquiring Within. The FTC included Mr. Zuckerberg as a defendant in the suit and accused him and Meta of planning to buy Within to dominate the nascent virtual-reality market and violate antitrust laws.

Politico reported that Meta only found out about the filing of the FTC’s lawsuit against it via Twitter. Politico also reported that the FTC is betting that early regulatory action will prevent Meta from holding deterministic power in the VR market.

The Federal Trade Commission posted information “Meta Platforms Inc./ Mark Zuckerberg / Within Unlimited, FTC v.” It was updated on August 19, 2022. Here is the Case Study portion:

“The Federal Trade Commission authorized a lawsuit in federal court to block the proposed merger between virtual reality (VR) giant Meta and Within Unlimited, the VR studio that markets Supernatural, a leading VR fitness app. Formerly known as Facebook, Inc., Meta sells the most widely used VR headset, operates a widely used VR app store, and already owns many popular VR apps, including Beat Saber, reportedly one of the best-selling VR apps of all time, which it markets for fitness use.

“The agency alleges that Meta’s proposed acquisition of Within would stifle competition and dampen innovation in the dynamic, rapidly growing U.S. markets for fitness and dedicated-fitness VR apps. A federal court complaint and request for preliminary relief was filed in U.S. District Court for the Northern District of California to halt the transaction.”

Personally, I’m in favor of preventing huge companies from grabbing up smaller ones for the purpose of making the smaller company’s products only accessible inside the bigger company’s “walled garden”. If the FTC wins their lawsuit it would be good for consumers – especially those who don’t want to sign up to Meta (or other “walled gardens”) to access a product or game that they were playing before the big company tried to acquire it.


Twitter-Musk Lawsuit Scheduled For October



Twitter won its first legal fight against Elon Musk on Tuesday when a Delaware judge granted the company’s request to fast-track its lawsuit seeking to compel the world’s richest person to complete his $44 billion purchase of the social-media site, The Wall Street Journal reported.

According to The Wall Street Journal, Chancellor Kathaleen St. Jude McCormick, the chief judge of the Delaware Chancery Court, ordered a five-day trial in October, over Mr. Musk’s objections. Chancellor McCormick said the case should be resolved quickly, agreeing with Twitter’s claim that it could be harmed by uncertainty about its future as a public company.

“Those concerns are on full display in the present case,” Chancellor McCormick said. “Typically, the longer the merger transaction remains in limbo, the larger the cloud of uncertainty cast over the company and the greater the risk of irreparable harm to the sellers.”

The Verge reported: This is a win for Twitter, which asked for a shorter timeframe than Musk. The trial will be five days – longer than Twitter asked for but shorter than Musk did. The exact dates have not yet been scheduled.

According to The Verge, Twitter’s counsel said that Musk’s conduct was “inexcusable.” Musk has held up an employee retention plan and is engaging in “needless value destruction”. Musk’s lawyers suggested that Twitter was giving Musk the run-around with bot data. Both teams of lawyers agreed that Musk’s team had run millions of queries on Twitter’s firehose, a real-time feed of Tweets as they are sent.

The Verge contributed the 62-page lawsuit to DocumentCloud.

Politico reported: This lawsuit marks the latest in a monthlong back-and-forth between Twitter and Musk over his April offer to buy the platform for $54.20 per share and take the company private. Market conditions have since depressed Twitter’s value. Musk is trying to get out of the deal over claims that the company has failed to cooperate with his endeavors to determine the number of fake accounts on the platform.

According to Politico, a Twitter spokesperson said the company is “pleased that the court agreed to an expedite the trial.” Twitter’s attorney William Savitt said during the Tuesday hearing, “Musk has been and remains contractually obligated to use his best efforts to close this deal. What he’s doing is the exact opposite of best efforts.”

The Guardian reported that on July 8, Musk said he was terminating the deal for three broad reasons: Twitter had breached the agreement by failing to provide enough information on spam accounts; that it had misrepresented the number of spam accounts in its disclosures to the US financial watchdog; and that it had breached the agreement by failing to consult with him when firing senior employees recently.

Based on what I’ve read on Twitter, there are Elon Musk fans who hope that Elon Musk will buy Twitter, because they believe he will never ban any content or account from the site. There are also people who said they will leave Twitter if Elon Musk buys it.


Apple Accused Of Antitrust Violations Over Apple Pay



Apple was sued on Monday, July 18, in a proposed class action by payment card issuers accusing the iPhone maker of abusing its market power in mobile devices to thwart competition for its Apple Pay mobile wallet, Reuters reported.

According to a complaint filed in San Francisco federal court, Apple “coerces” customers who use smartphones, smart watches and tablets into using its own wallet for contactless payments, unlike makers of Android-based devices that let consumers choose wallets such as Google Pay and Samsung Pay.

The plaintiff in this complaint is Iowa’s Affinity Credit Union, who said Apple’s anticompetitive conduct forces the more than 4,000 banks and credit unions that use Apple Pay to pay at least $1 billion of excess fees annually for the privilege. According to Reuters, Apple did not immediately respond to requests for comment.

MacRumors reported that the lawsuit was filed in U.S. District Court in Northern California. The complaint specifically accuses Apple of multiple violations of the federal Sherman Act by “tying” Apple Pay to its mobile devices and monopolizing the “tap and pay iOS mobile wallet market.”

The Verge reported the Plaintiffs claim that Apple has an illegal monopoly over contactless payments on the iPhone, letting it force card issuers into paying fees (via Bloomberg). The suit is being kicked off by Iowa-based Affinity Credit Union, which issues debit and credit cards that are compatible with Apple Pay, but the company’s lawyers hope to make it a class-action case so other card issuers can join the lawsuit.

According to The Verge, lawsuits aren’t automatically granted class-action status – a judge has to decide whether or not to grant it. However, the law firm handling the case for Affinity, Hagens Berman, has a bit of a track record with class-action suits against Apple. It was involved with getting developers a $100 million settlement after alleging that the App Store’s rules were unfair, as well as with the ebook price fixing case that ended with Apple returning around $400 million back to customers.

The complaint is against Defendant Apple Inc., and for Plaintiff Affinity Credit Union, on its own behalf and that of all similarly situated payment card issuers.

Based on everything I’ve read about this lawsuit, it appears to be focused on getting banks and credit unions a reimbursement for the fees that they had to pay in order to offer their customers an Apple Card. The lawyers for Affinity Credit Union want a class-action lawsuit, which could potentially erase the fees that credit unions were charged by Apple.

It does not mean that anyone with an Apple Card can join in this particular class action lawsuit, or that card holders will benefit financially in any way – no matter what the final decision turns out to be. In my opinion, this is a lawsuit that is being presented in an effort to reimburse a specific credit union.


Court Allows Lawsuit By Woman Who Says She Helped Create Pinterest



Bloomberg reported that Pinterest Inc. must face a lawsuit from a digital marketing strategist who says she helped conceive the social media platform, a California judge ruled. According to Bloomberg, Alameda County Superior Court Judge Richard Seabolt denied the company’s motion to dismiss the suit, but he eliminated co-founder Paul Sciarra as a defendant because he left Pinterest a decade ago.

Bloomberg reported that Christine Martinez sued the company in September, saying she contributed key ideas to the platform but was never compensated by founders Bill Silbermann and Sciarra. According to her complaint, Oakland resident Martinez was friends with Silbrermann when he asked her to “salvage a failed shopping app” that later became Pinterest.

She says she developed some of the main concepts for the platform, including features that allowed users to create “pinboards” reflecting their cultural tastes and created a marketing plan to enlist bloggers to recruit users. Martinez claims she was so integral to the site’s creation that Silbermann and Sciarra embedded her name in the platform’s code.

The New York Times provided some background information (in 2021). The New York Times reported that when Pinterest went public in 2019, Christine Martinez’s friends sent congratulations. She had worked closely with the founders of the digital pinboard in its earliest days, and her friends through she would get rich alongside them. But as Pinterest’s stock price rose, turning its founders into billionaires, Ms. Martinez realized she would not be compensated or credited for her contributions, she said.

According to The New York Times, Ms. Martinez was never formally employed by Pinterest, nor did she ask for a contract. She was not given stock, though she said Pinterest’s founders had verbally agreed to compensate her many times. The New York Times also reported that other women who were former Pinterest employees wrote on Twitter about the pay disparities, retaliation, and sexist, racist comments they had experienced at the company. Pinterest’s former chief operating, Francoise Brougher, sued Pinterest, claiming gender discrimination and retaliation.

Engadget reported that Ms. Martinez filled a lawsuit against Pinterest in September. In December, the company filed a motion to dismiss it. Pinterest argued that Ms. Martinez’s claimed were too old to fall within the statute of limitations. Judge Seabolt disagreed. He stated that Ms. Martinez “sufficiently alleges” the she and the Pinterest founders agreed to deferred compensation. Pinterest went public in 2019, an event that Seabolt deemed “transformative” and his view sealed the company’s obligation to pay Ms. Martinez.

These kinds of lawsuits are important. They serve as a way to prevent employers from intentionally discriminating against the women they hired. It makes absolutely no sense to me why the Pinterest founders agreed to deferred compensation – and then (perhaps intentionally) failed to pay Ms. Martinez the money they owed her for the work she did on Pinterest.


Judge Dismisses Trump Lawsuit Seeking To Lift Twitter Ban



A judge dismissed a lawsuit by former President Donald Trump seeking to lift his ban from Twitter, CNBC reported. Twitter banned Trump on January 8, 2021, citing the risk of the incitement of further violence on the heels of the Capitol riot by a mob of supporters of the then-president two days earlier, CNBC reported.

Trump, the American Conservative Union, and five individuals had sued Twitter and its co-founder Jack Dorsey last year on behalf of themselves and a class of other Twitter users who had been booted from the app.

Judge Donato’s ruling comes nearly two weeks after Trump told CNBC he had no interest in returning to Twitter even if his ban were to be lifted by Elon Musk, the Tesla chief whose $44 billion offer to buy Twitter has been accepted by the company’s board.

CNBC also reported that before the ban, Trump was an avid Twitter user, tweeting an average of more than 30 posts per day toward the end of his presidency. At the time of the ban, Trump had nearly 90 million followers on Twitter. His suit alleged that Twitter violated the plaintiff’s First Amendment rights to free speech, arguing that the bans were due to pressure on the company by Democratic members of Congress.

The Verge reported that Judge James Donato wrote that “Plaintiffs are not starting from a position of strength” in the first paragraph of his analysis.

The Verge also reported that Judge Donato determined that Twitter was not operating as a state actor when it banned Trump – a claim Trump made by noting that some lawmakers had called on Twitter to remove him from the platform.

“Legislators are perfectly free to express opinions without being deemed the official voice of the State,” the ruling says, dismissing a “grab bag” of allegations quoting various Democratic elected officials calling for a ban. Even strident congressional commentary, it concludes, “fits within the normal boundaries of a congressional investigation, as opposed to threats of punitive state action.”

Trump and his fellow plaintiffs also had a Section 230 claim – which failed. Politico reported that Judge Donato’s 17-page decision also rejected arguments from Trump attorneys that a controversial 1996 law known as Section 230 of the Communications Decency Act led to the then-president’s de-platforming in January of last year.

Politico reported that the Section 230 law allows internet sites to police message boards and other user postings without incurring potential liability as a publisher of the content. According to Politico, Judge Denato wrote, “The government cannot plausibly be said to have compelled Twitter’s action through Section 230, which in any event imposed no affirmative obligations on Twitter to act in any particular way.”

Trump’s lawsuits against Facebook and YouTube remain pending. Perhaps the lawyers representing Trump and his fellow plaintiffs will have learned that the Section 230 claim is not going to be compelling to a judge. I’m wondering why the Twitter lawsuit even got this far, considering that Trump has stated that he doesn’t want to go back on Twitter.

Just to clarify, if the government throws you in jail for speech that it disagrees with – that’s a violation of your Freedom of Speech. If a social media site suspends you from the platform because you broke its rules regarding hate speech, inciting violence, etc. – that’s not a violation of your Freedom of Speech. Social Media websites are not part of any state of federal branch of government.