E-commerce giant Amazon's attempt to have an antitrust lawsuit over pricing practices has encountered a setback after a presiding judge at the US District Court in Seattle, John Chun, allowed competitor Zulily to move forward with its case. 

Zulily is an online retail marketplace for clothes, toys and home décor.

The litigation alleges that Amazon engaged in anti-competitive behaviour which negatively impacted online marketplace competition, leading to decreased sales for Zulily and resulting in elevated prices for consumers.  

The lawsuit contends that certain practices by Amazon might breach federal antitrust regulations. 

At the heart of Zulily's complaint are accusations against Amazon's policies that purportedly prevent retailers from offering products at prices lower than those found on Amazon's platform. 

Zulily has accused Amazon of engaging in price manipulation and restrictive practices, which Zulily claims have led to a decrease in its profits, consumer sales and website traffic.  

The company alleges that these actions by Amazon have forced some suppliers to cease offering their products on Zulily or to terminate their relationship with the retailer altogether due to repercussions from Amazon.  

This is even though Zulily does not typically charge merchant fees and is often preferred by merchants over Amazon. 

Amazon responded to these accusations by arguing that Zulily does not have the legal standing for an antitrust lawsuit and asserting that Zulily has not experienced a direct antitrust injury as it does not operate within the core market described in the complaint. 

The court has rejected Amazon's motion to dismiss the case based on antitrust standing. However, it has agreed with Amazon's request to dismiss certain trade restraint allegations under both federal and state laws according to Rule 12(b)(6), as well as dismissing a deceptive practices claim under Washington's Consumer Protection Act. These dismissals are without prejudice. 

The court has granted Zulily permission to submit a revised complaint regarding the dismissed claims, giving them an opportunity to address the issues identified by the court which extends to the end of January 2025.