‘Amazon rules the world at this point’: Ursula thinks $20B lawsuit may end with a small check

Washington has joined the Federal Trade Commission (FTC) and 21 other states in a massive lawsuit accusing Amazon of secretly overcharging businesses that advertise on the platform.

The FTC alleged that beginning in 2019, Amazon subtly altered how its online ad auctions worked. Advertisers were told they were participating in a competitive auction where the winner would pay just enough to beat the next-highest bid. The lawsuit claims Amazon added a hidden surcharge, using what employees internally described as an “invented auction participant” that pushed prices higher.

Washington State Attorney General Nick Brown said his office joined the case because businesses in the state were among those allegedly overcharged. Amazon denies wrongdoing and said its system improves the relevance of advertising.

Gee Scott and Ursula Reutin, co-hosts of “The Gee and Ursula Show” on KIRO Newsradio, weighed in on the lawsuit, with Gee questioning whether any penalty will actually matter.

“This whole surcharge and dynamic pricing and everything related to what the human eye can’t see and/or focus on, and AI and these computer tools being used to really just make us pay more money and everything,” Gee said.

“What kind of penalty is there really?” he continued. “Is this one of those penalties like, ‘Hey, there’s no wrongdoing, and if there is, look, we’ll settle, we’ll give you a little bit of money,’ or do they really, or will they ever really make these companies pay? Don’t you worry. This will potentially happen again, and if they get caught, it’s oopsie.”

The FTC said more than 1.2 million advertisers were affected, including more than 500,000 small and medium-sized businesses, and that the practice may have generated more than $20 billion in extra revenue for the company.

Ursula says $20 billion in overcharges will end with ‘a little something’

Ursula said the scale of the case, 22 states and the federal government, sounds serious on paper but may not amount to much against a company of Amazon’s size.

“You’re talking about generating more than $20 billion in extra revenue by doing this,” Ursula said. “Well, we got the federal government, the FTC, and 22 different states, including Washington, going after Amazon. And they’ll probably end up having to pay something.”

“A little something,” Gee replied.

“But Amazon rules the world at this point,” Ursula said.

Gee ties the lawsuit to a bigger conversation about wealth and power

Gee said the lawsuit landed on the same day the show had already been talking about billionaires and political access, and he used the moment to draw a contrast.

“Billionaires rule the world at this point,” Gee said. “It’s really unfortunate how that is happening. Have you guys noticed how we just throw out billions of dollars? Like earlier today, we talked about how Apple is now worth $4 trillion. We throw around the word ‘billions’ like it’s nothing, and yet the federal minimum wage is still $7.25.”

“Amazon’s worth 2.75 trillion, by the way,” Ursula added. “I just looked it up.”

The FTC and the 22 states are seeking civil penalties, restitution and other court-ordered relief. The lawsuit was filed in U.S. District Court for the Western District of Washington. Amazon reached a separate $2.5 billion settlement with the FTC last year over its Prime membership program.

Watch the full discussion in the video above.

Listen to Gee and Ursula on “The Gee and Ursula Show” weekday mornings from 9 am to 12 pm on KIRO Newsradio.