Close on the heels of Meta, Live Nation, Mercedes-Benz, EpiPen, and Deloitte wins: Attorney General Todd Rokita files lawsuit against Amazon over hidden auction fees for advertisers


Following a monumental settlement announcement with Meta, Attorney General Todd Rokita, along with the Federal Trade Commission (FTC) and 20 other states, yesterday filed a federal lawsuit accusing Amazon of overcharging businesses by potentially billions of dollars through a rigged auction system for online ads.


The complaint alleges Amazon artificially raised prices, deceived advertisers and took steps to conceal the scheme, in violation of federal and state law.


Amazon sells advertising across its platform to businesses trying to reach its massive customer base, including many small businesses and job creators. Those ads were sold through what Amazon described as “second-price” auctions: the winning bidder pays only the minimum needed to beat the next-highest bid. In that system, a $5 winner would pay $3.01 if the second-place bid was $3.


“Amazon’s secret surcharges and deceptive auction practices put profits ahead of the hardworking Hoosier businesses and consumers who rely on a fair marketplace,” Attorney General Rokita said. “We are taking action to restore transparency, protect our job creators and ensure Amazon follows the same rules as everyone else.”


The lawsuit alleges that while Amazon publicly described a second-price system, it quietly replaced the true second-place price with a higher, internally calculated figure that was more profitable for Amazon. The company never disclosed those replacements, which it referred to internally as surcharges. Amazon also acted as both auctioneer and seller.



Those inflated ad prices raise costs for products bought and sold on the platform, harming Hoosier consumers and small businesses.


According to the complaint, Amazon tested, hid and strengthened this pricing strategy from 2018 to the present. Over time, the company probed how far it could push the markup before advertisers noticed. The lawsuit alleges substantial potential damages from years of that conduct.


The complaint charges that Amazon’s practices violate Indiana’s Deceptive Consumer Sales Act through unfair, abusive and deceptive acts, as well as other federal and state statutes. Plaintiffs seek restitution for affected Hoosiers and businesses, including recovery of financial losses; injunctive relief to stop further violations; civil penalties of up to $5,000 per knowing violation; and reimbursement of the attorney general’s investigative costs.


The complaint is available
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here .


Hoosiers are encouraged to contact the Office of the Indiana Attorney General about any suspected scams or scam attempts. Consumers can file a complaint by visiting
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indianaconsumer.com or calling 1-800-382-5516.


A headshot of Attorney General Rokita is
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available for download .


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