Amazon, Flipkart Antitrust Lawsuit Of ‘Preferred Sellers’ Continues In Karnataka High Court

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Amazon and Flipkart are in trouble as the Karnataka High Court has dismissed their pleas against an antitrust lawsuit. The lawsuit was filed in 2020 where the trader's group accused the e-commerce giants of promoting 'preferred sellers'. The latest court ruling comes as a blow to the US companies, including Flipkart which is currently owned by Walmart.

 

Amazon, Flipkart Antitrust Lawsuit Of ‘Preferred Sellers’ Continues

Amazon, Flipkart Lawsuit Continues

There have been reports and allegations against both Amazon and Flipkart in favoring a few sellers, which was hurting the business of other small sellers. Going into the details, the Competition Commission of India (CCI) had initially announced an investigation after a trader's group complained and accused both e-retailers.

However, the Indian court had put a hold on the investigation after both Amazon and Flipkart challenged the CCI saying there was no evidence of harming the competition. While this was thought to be a small victory for the retailers, the Karnataka High Court has once again given the green signal to continue investigations.

Justice P.S. Dinesh Kumar of the Karnataka High Court dismissed the petitions filed by Amazon and Flipkart. Further, the judge refused them any relief in halting the investigation. In a 51-page order, the judge said, "It would be unwise to prejudge the issues ... at this stage and scuttle the investigation."

Amazon, Flipkart Antitrust Lawsuit In India

To note, the CCI investigation into Amazon and Flipkart has been on hold since February 2020. The new ruling by the Indian court has once again granted permission to the market competition watchdog to continue the investigation.

Looking back, when the investigation was initially started, CCI had listed out four alleged anti-competitive practices. Among these also included the exclusive launch of smartphones by Amazon and Flipkart, which further promoted preferred sellers on their websites. Additionally, the allegations included deep discounting offers and even prioritizing some seller listings.

 

The court ruling comes as a major setback to both Amazon and Flipkart. Amazon already has several lawsuits across several countries and states. Amazon said it would review the order "carefully and then decide on the next steps." Flipkart hasn't responded to comments yet.

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