Amazon.com, Inc. (NASDAQ:AMZN) Marketplace seller David Topkins, became the first ever trader in the e-Commerce space to be prosecuted for ‘collusive, non-competitive’ practices. On Monday, the US Department of Justice announced that it had fined, David Topkins, $20,000 in criminal charges for illegally fixing the prices of posters he sold on his online store.
Amazon.com, Inc. Marketplace which offers a platform for third-party sellers was where Topkins sought to collude with other sellers between September 2013 and January 2014.
The San Francisco Federal Court alleged that David Topkins had written computer code to run algorithms such that the prices of posters he sold online was coordinated between all sellers. Topkins had sought out other poster sellers and sought to share information on prices with them so that prices and sales could be manipulated. The Justice Department claimed that this violated Sherman Act, an antitrust law with federal implications. The Justice Department concluded that the act of Topkins non-compliant with Sherman Act guidelines but was anticompetitive as well.
Assistant Attorney General Bill Baer in a statement reiterated that the law was intolerant to anticompetitive practices, whether online or otherwise. Therefore, Topkins anticompetitive practices were punishable as the law supported only ‘free and fair’ marketplace online or offline.
Amazon.com, Inc. (NASDAQ:AMZN) Marketplace has been a rigorous platform where small and medium sized sellers and merchants have been selling their products. Amazon Marketplace is in direct competition with that of eBay Inc and operates separately from its e-commerce business.
The Justice Department has not held Amazon.com, Inc punishable in the Topkins case and it is likely that the terms of punishment would be higher, including 10-year prison term followed by $1 million fine. Topkins plea to pay $20,000 fine and cooperate with the probe is yet to be approved by the court.